No Recovery for Canada's Economy, New CCPA Study Shows
November 5, 2009, 9:13 AM EST
"Canada's private sector has not yet bounced back from last year's economic shock and there are no signs that it will rebound quickly," said CAW Economist Jim Stanford in a press statement released by the Canadian Centre for Policy Alternatives on October 29. The statement was made in conjunction with the release of a new economic study that finds more public investment dollars are critical for ongoing economic recovery in Canada.
The study Canada's Long Road to Economic Recovery, co-authored by Stanford and Alternative Federal Budget coordinator David Macdonald, examines a full range of economic indicators and suggests that Canada's economy is nowhere near experiencing a true recovery and still hindered by recession.
The authors argue that a full economic recovery will require strong growth in the usual drivers of economic expansion, namely exports, business investment and construction.
"Failing that, the Canadian government will need to expand its stimulus effort not phase it out as the Harper Conservatives are already planning," Stanford said.
The United States has so far experienced a much more pronounced bounce-back as recent economic reports indicated a growth rate of 3.5 per cent. Most recent economic data for Canada showed a slight decline in gross domestic product (-0.1 per cent) for the month of August.
Stanford said the discrepancy in the two economies is not surprising, especially since U.S. stimulus spending on programs directly related to job creation has outstripped Canada by a seven-to-one margin in the first half of 2009.
Canada's Long Road to Economic Recovery, the first in a series of technical papers in coordination with the Alternative Federal Budget, can be downloaded for free: http://www.policyalternatives.ca/~ASSETS/DOCUMENT/National_Office_Pubs/2009/Long_Road_to_Economic_Recovery.pdf