Loading articles...

Uneven rebound poses risk for entire economy, Bank of Canada governor says

The Bank of Canada building is seen in Ottawa, Wednesday, April 15, 2020. Canada's central bank is turning to the public for input on its inflation-rate target that underlies any changes to the bank's trend-setting interest rate. THE CANADIAN PRESS/Adrian Wyld

OTTAWA — The governor of the Bank of Canada warns the slower rebound facing women, youth and low-wage workers could pose a threat to a broader economic recovery from the COVID-19 pandemic.

Tiff Macklem says uneven recessions that affect some workers and sectors more than others tend to be longer and leave a larger mark on the labour market.

He notes in a speech to the Canadian Chamber of Commerce that women and young people are more likely now to be permanently laid off from their jobs due to the pandemic.

People permanently laid off take on average twice as long to return to work as people on temporary layoff, Macklem says, risking long-term damage to their jobs prospects and a lasting drag on earnings specifically for youth.

Macklem says the central bank is doing everything it can to support growth and get people back to work.

He adds that getting people back to work is the best way to improve economic outcomes over time, noting that uneven outcomes for some can lead to poorer outcomes for all.