07) ECONOMIC WINNERS AND LOSERS

 

* Operating profits reported by corporations in Canada have edged down slightly this year, but remain at historic levels. Statistics Canada reported in August that corporations earned $72.2 billion in operating profits in the second quarter of 2013. That marked a decline of 0.8% from the previous quarter, which was a drop of 2.8% from the final three months of 2012. These figures point to a total of some $290 billion for this calendar year, the highest in Canadian history. Just as significant, the 2013 numbers are a huge jump over just four years ago; in 2009, total corporate operating profits were in the $200 billion range, following the fiscal meltdown of September 2008.

 

* In the winner‑take‑all world of corporate capitalism, on Sept. 20 BlackBerry stock closed down $1.74, a drop of 16%, to $9.08 on the TSE. The company expects to post a loss of US$950 million when it reports second‑quarter earnings. But the real victims are BlackBerry employees, 4,500 of whom will be laid off as the company tries to cut operating costs by 50% by next June.

 

* Canadians who lose their jobs are less likely to get EI benefits than at any other time on record. StatsCan says the number of EI recipients fell by 2.1% in July, to just under 504,000, similar to the numbers before the labour‑market downturn in 2008. Unfortunately, the total number of jobless is still 300,000 higher. There are nearly 1.4 million unemployed people in Canada today, versus 1.1 million in September 2008, when the collapse of Lehman Brothers triggered the global financial crisis. According to Erin Weir, an economist for the United Steelworkers, the proportion of unemployed Canadians receiving regular EI benefits was 36.5% in July, the lowest on record. As recently as 2007, 45% of unemployed qualified for EI benefits. Weir also noted that the number of Canadians applying for the first time for EI, or renewing their EI benefits, jumped by 3.4%, suggesting the job market weakened even as EI benefits rolled out to fewer people. The Harper government toughened EI rules earlier this year, creating more complex standards to keep benefits and a new requirement that beneficiaries who have used EI frequently have to take any job available to them and accept as much as a 30‑per‑cent pay cut.

 

(The above article is from the October 1-15, 2013, issue of People's Voice, Canada's leading communist newspaper. Articles can be reprinted free if the source is credited. Subscription rates in Canada: $30/year, or $15 low income rate; for U.S. readers - $45 US per year; other overseas readers - $45 US or $50 CDN per year. Send to People's Voice, c/o PV Business Manager, 706 Clark Drive, Vancouver, BC, V5L 3J1.)