Ex-parliamentary budget officer says there is ‘still lots of growth in the service sector’
Although Canada is in a likely technical recession — defined as two consecutive quarters of negative growth — it’s a recession that is contained, says former budget watchdog Kevin Page.
“In the current context, if you look at the growth numbers, the recession is effectively in the goods sector, it’s in the oil industry, it’s weak growth in manufacturing, weak growth in construction,” said Page in an interview on CBC Radio’s The House.
“It’s quite contained. There’s still lots of growth in the service sector.”
But Page, who served as Canada’s first parliamentary budget officer from 2008-2013, cautioned against reading too much optimism into the numbers.
The Canadian economy lost 6,400 jobs in June as gains in full-time work were offset by losses of part-time jobs, according to Statistics Canada.
The jobless rate stayed steady at 6.8 per cent, the same level it has been at since February. It was a better showing than what a consensus of economists were expecting, which was a loss of about 10,000 positions, but Page said the pattern remains one of shrinking growth.
“For the second quarter we had net job creation of more than 30,000, but if you look at the trend in June we actually declined,” he said.
“So if you look at the job picture, it’s gotten progressively weaker through the summer. I think that would be a concern for the government and a concern for the overall strength of our economy.”
“The economy’s weak, you can’t deny that. It will be pretty hard for Minister [of Finance Joe] Oliver to keep that line that we’re not in a technical recession,” Page added.
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