People wait for the arrival of a flight at Pearson Airport in Mississauga, Ont., on March 14, 2023.Chris Young
Getting caught up on a week that got away? Here’s your weekly digest of the Globe’s most essential business and investing stories, with insights and analysis from the pros, stock tips, portfolio strategies and more.
Canada stuck in ‘population trap,’ needs to reduce immigration, bank economists say
According to a report from National Bank of Canada economists, Canada is stuck in a “population trap” and needs to rein in immigration significantly to escape it. Economists Stéfane Marion and Alexandra Ducharme say a population trap is a situation in which living standards are unable to improve, because the population is growing so quickly that all savings are needed to maintain the capital-to-labour ratio. One of the consequences has been housing costs, particularly in rental housing, where construction has lagged behind demand from newcomers. Ottawa’s expansionary immigration policies have also increasingly come under fire, Matt Lundy reports.
The Bank of Canada prepares for a future that does not look like the past
Over the past year, a team of Bank of Canada economists have been working on a major overhaul of the bank’s two main macroeconomic models – the tools used to produce quarterly forecasts for inflation and economic growth. The central bank is looking to re-engineer the way it models the economy after a series of forecasting errors during the COVID-19 pandemic. It will be the largest revamp in nearly two decades, and an opportunity to prepare for a future that does not look like the past, Mark Rendell reports. Earlier this week, Statistics Canada reported that the annual inflation rate rose to 3.4 per cent in December, which potentially complicates matters for the Bank of Canada and its next interest rate decision is on Jan. 24.
Americans are creating new businesses at a feverish pace
In the United States, a boom in business creation that began in 2020 has been kicked into overdrive. The American economy is creating new businesses at an incredible pace. December marked the fastest 12-month stretch of startup activity on record, based on the number of what the U.S. Census Bureau calls “high-propensity business applications.” Jason Kirby reports it’s the latest sign that America’s economic engine continues to defy expectations of a slowdown. Canada, on the other hand, is experiencing the opposite. Get a closer look in the latest Decoder.
$7.1-billion in CERB and CRB overpayments still being collected, Globe analysis finds
Canadians still owe $7.1-billion in CERB and CRB overpayments, according to a Globe analysis. The federal government is seeking repayments from individuals it found to be ineligible for all or part of the pandemic aid they received. As of the end of September 2023, Canadians have paid back $4.1-billion worth of both benefits – but roughly 883,000 individuals still owe CERB or CRB debt. Ottawa is under pressure to recover overpayments of pandemic benefits from both individuals and businesses – the CEBA repayment deadline was this week – but anti-poverty advocates say collection efforts have been overly harsh on lower-income Canadians, Erica Alini reports.
LifeLabs medical testing company for sale by pension fund manager OMERS
One of Canada’s largest pension plans has put LifeLabs Medical Laboratory Services up for sale after building the business over 17 years, reports Andrew Willis, James Bradshaw and Sean Silcoff. Ontario Municipal Employees Retirement System (OMERS) had invested more than $2.5-billion in LifeLabs, but hired investment banks to find a new owner for Canada’s biggest medical testing company. The Globe reports that LifeLabs has drawn multiple bidders, with two health care companies emerging as the leading contenders: Andlauer Healthcare Group and N.J.-based Quest Diagnostics Inc. This isn’t the first time OMERS has put LifeLabs on the market. But previously, the pension fund manager failed to find a buyer.
A five-step retirement plan for Gen Zs and millennials to retire comfortably. Yes, really.
Gen Z and millennials, yes, you can retire comfortably. But there are some caveats. Rob Carrick outlines five steps for young people who doubt they’ll ever retire as a result of today’s financial pressures. First, get used to the idea of retiring at age 70. Second, invest more in your 20s and 30s. Third, set a timeline for home ownership and starting a family. We promise that the list offers a combination of both realistic and reassuring advice to make you feel slightly better about planning your future.
Now that you’re all caught up, test your knowledge with our weekly business and investing news quiz and prepare for the week ahead with the Globe’s investing calendar.