Chapter 5: Economic Indicators
"Unemployment down to 6.1% in December"
CBC news, published: Friday, January 5, 2007

Summary

The national unemployment rate of Canada reached back down to a 30-year low with a 6.1 percent in January. The increase from December’s employment increase includes 37,000 full-time jobs and 25,000 part–time jobs. The overall for 2006, employment grew by 345,000 jobs, or just over 2 percent. In Alberta, employment growth in December after months of re-hot expansion, but the province still led the country with the lowest provincial jobless rate of 3.4 percent. Albwet’a tight about market continue to put pressure on wages, which rose 5.9 percent from a year ago to $21.60, the highest growth rate in the country.

Reflection and Relationship

Having a low unemployment rate is always good and especially one that reaches a 30-year low. With more people working it would help stimulate the economy and making use of the labour force. Even though the economy is operating at full capacity there is what is known as the natural rate of unemployment. There will always be the people who aren't working for different reasons like they can't find the job they want or they are just plain lazy. To be more precise, there will always be those who are unemployed because of seasonal, frictional, and structural reasons. With this many people employed and having a reasonable income, it will affect Canada’s economic statistics. The gross domestic product/GDP will increase due to the increase in to all the final goods and services that are produced. With people willing to spend because then the exchange of goods and services will continue to grow. The eonomy will grow from this and prices may rise from the sudden increase in demand.

Although low unemployment is a good thing it may eventually cause things to become more difficult. In Alberta’s situation the average income has risen to $21.60 and with this increase in income, people would spend more. This would create a large demand for supplies and also decreasing the supplies. It may eventually lead to the point where the aggregated demand for the goods and services to exceed the supply, which may cause the prices to go up. This would be known as the demand-pull inflation. Also as the standard of living goes up people or countries may be discouraged from investing in Canada. If companies have to pay high wages for Canadian workers, they may turn to other places that are willing to work for lower wages. If this holds true then it may cause a problem in the future because everyone knows that nothing good last forever.