Canada’s largest solar farm, GDP growth and an immigrant jobs boom
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’s first-quarter GDP rose higher than expected
Canada outperformed expectations on its first-quarter gross domestic product (GDP) reading earlier this week, prompting some speculation the Bank of Canada could raise interest rates again – perhaps as early as next week. The Canadian economy grew at an annualized rate of 3.1 per cent in the first quarter, buoyed by strong exports and robust consumer spending. Mark Rendell reports, however, that this economic resilience is a problem for Canada’s central bank, which is deliberately trying to slow down the economy to bring inflation back under control. David Parkinson also writes that the quarter’s brisk growth rate is “too much of a good thing” because it implies more inflationary pressure in the quarter, not less.
A recession might be just what Canada needs
What if a recession – or a prolonged economic slump – is exactly what Canada needs? According to Tim Kiladze and Matt Lundy, the R-word might be the only way to reset the country’s overheated economy. Historically, the economy has gone into recession roughly once a decade. And not every recession is as painful as the 2008-09 global financial crisis. A group of prominent economists recently put out a paper looking at advanced economies since the end of the Second World War, and concluded that a recession now would help to quash runaway inflation, sky-high price increases and cool down the housing market.
Canadian consumer spending is at an all-time high
Can we shop our way out of a recession? Consumers in Canada are giving it their best shot. This week’s strong first-quarter GDP growth was powered by two sectors – exports and consumer spending. Consumer spending, specifically, rose 5.7 per cent on an annualized basis. That growth was twice as fast as economists expected, and it pushed consumer spending to its highest share of GDP since records began in 1961. Resilient consumers have been credited for helping stave off recession in the United States, but Canadian shoppers are outspending their U.S. counterparts. Jason Kirby takes a closer look in this week’s Decoder.
Greek company Mytilineos to launch Canada’s largest solar farm in Alberta
Mytilineos, one of the top industrial and power companies in Greece, is launching a $1.7-billion solar-energy project in Alberta that it says will be the largest of its kind in Canada. The project will be built on separate plots in Southern Alberta, one of the sunniest areas in Canada and home to many of the country’s biggest solar farms. Once finished, it will have enough capacity to power 200,000 homes. Eric Reguly reports that fossil fuels account for almost 90 per cent of power generation in Alberta, and the province is under pressure to bring that share down as Ottawa strives to meet the net-zero emissions goal by 2050.
The good and bad of Canada’s immigrant jobs boom
Canada’s labour boom is creating plenty of opportunities for recent immigrants, according to Matt Lundy. The employment rate for recent immigrants – those who landed in Canada within the past five years – has topped 70 per cent, the strongest level on record. What’s contributing to the unequivocally positive trend? The biggest factor in the employment surge is that Canada has moved toward a two-step immigration process, meaning a larger share of people who become permanent residents have already worked in Canada as temporary residents.
Gen Z thinks you need to make $100,000 to live comfortably
How much do you think you need to live comfortably in Canada? According to a recent poll by Abacus Data, Gen Z believes they need to earn an average of $100,953 to live a comfortable life. For reference, boomers said $63,753, Gen X said $84,700, and millennials said $87,386. According to Rob Carrick, it seems clear in these numbers that the older and more established you are, the less you figure you need to live a comfortable life. He writes that young people know what they’re up against trying to afford adulthood. Do the rest of us?
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Now that you’re all caught up, prepare for the week ahead with the Globe’s investing calendar.
This article was first reported by The Star