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Vol. 74/No. 5      February 8, 2010

Canada: Joblessness still
high in so-called recovery
MONTREAL—Some 500 full-time and 400 contracted oil refinery workers in east-end Montreal face the prospect of long-term unemployment after the January 7 announcement by Shell Oil bosses of their decision to close their 76-year-old Montreal refinery by the end of the year.

The Shell layoffs reflect how workers in Canada, particularly those in manufacturing and resource industries, continue to face massive unemployment under the impact of the deepening world capitalist depression. Hundreds of thousands will use up their federal Employment Insurance (EI) payments in the coming months.

According to figures published by the Canadian Labour Congress (CLC), the largest union federation in Canada, of the more than 1.6 million officially unemployed, one in five have been out of work more than six months—an increase of 6 percent over the last year.

The number of unemployed workers who don’t receive EI benefits has jumped by 33 percent. In 29 cities across the country the average proportion of unemployed workers who receive benefits is about 36 percent.

The CLC predicts that more than 500,000 workers will end up applying for government welfare after exhausting their benefits in 2010.

The reality facing working people stands in contrast to statements like that of Royal Bank of Canada chief economist Craig Right. On January 4 Right stated that he is seeing “improving global outlook, improving global financial markets and improving outlook for Canada.”

On January 11, Finance Minister James Flaherty, who Prime Minister Stephen Harper says is preparing a budget to “put Canadians to work,” admitted at a press conference that because of continuing high unemployment the “economic recovery” is in a fragile state. He went on to blame the high value of the Canadian dollar relative to the U.S. dollar and protectionist policies by the administration of U.S. president Barack Obama.

Last year the official rate of unemployment jumped from 6.3 to 8.5 percent. The real unemployment rate, however, is at least 10.4 percent. The real unemployment rate takes into account workers who have given up looking for a job and involuntary part-time workers.

Even this figure is probably conservative. Last March an article in the Toronto Star criticizing the federal government’s method of calculating the labor force and the unemployment rate suggested the real unemployment rate is closer to 13 percent or 3 million.

The United States is Canada’s largest trading partner and competitor. According to the Montreal daily La Presse over the past year exports of manufactured and other products to the United States dropped 29 percent. This includes the energy sector. In the first seven months of 2009, petroleum product exports from Canada to the United States declined to $34 billion, 51 percent less than in a comparable period in 2008.
Related articles:
U.S. rulers prepare deeper social cuts
Workers face more economic uncertainty
Working-class answers to crisis
Major U.S. banks report gigantic profits for 2009  
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