The Crash is Coming
Job Layoffs - is this on anyone's radar?
The Lead-in
We hear about all the jobs begging to be filled, somewhere like 986,000 in Canada. But they don't mention that many of those jobs are in the low-wage sector, where if you go to work, you cannot even make ends meet. Is anyone paying attention to this?
Take a Step Back
Let's take a step back for a second and look at salaryversus expenses. At $20 per hour and working 32 hours per week - manybusinesses do this so they do not have to pay benefits. That works out to a monthly salary of $2,560 with a disposable income of $2,050 (Please note, these numbers are approximate for discussion purposes).
Thatis the revenue side,now the expense side for one person.
The Message from the Bank's CEO
The Scotia Band CEO said he does not see a problem - he figures "only" 20,000 of their clients will default on their mortgages. All the while, he collects his $24 million salary. He has no empathy for the individuals or recognition that times are changing, and he also refers to old data to suit his self-interest.
The CEO of RBC was just a little behind, supporting the assertion that few people will default. They came up with a total of about 800
Thousand people, which sounds like an awful lot to me. What do you think?
Now, if you are a family of 4 with a mortgage, your total expenses could be in the $6,000 per month range, requiring a minimum salary of $95,000 per year. And that does not include any discretionary spending, daycare, emergencies, property taxes, telephone, or internet, maintenance fees and other required expenses. Those could quicklypush costs to $7,400per month, requiring an annual salary of $120,000 per year, and that is certainly not living high off the hog.
So, Mr. CEO, where is the room for a lifestyle change thatyou suggest peoplewill have to make, moving from discretionary spending to paying down their mortgage debt? Mr. Banker CEO, you should be ashamed of yourself. Disingenuous at best. Good people are struggling, and many who unwittingly support your generous salary deserve the humblest of apologies. But hold it for a minute; since I must mention this, "you are too late, Jake.”
The Genesis for this Story
The genesis for this blog came from a report that Godman Sachs and BlackRock are laying off up to 500 employees. This is on the coattails of the Amazon announcement that they are laying off thousands, along with several other companies ditching employees.
Who knows what the final layoff numbers will be? Suffice to suggest that our politicians do not appear to be taking notice; in fact, PM Trudeau down in Mexico said today that he and his government are working hard to protect Canadian jobs. But, of course, with no substance to the statements and all the new costs we are facing, like the carbon tax, it isn't easy to take Trudeau seriously.
The problem may be that PM Trudeau has a buddy contracting arrangement with McKinsey and company to think about or trying to keep secret that his friends in China hold part of the 1/3 of our national debt held by foreigners.
Interestingly, during the question period, the Conservative leader asked the direct question, "how much of the 1/3rd debt held by foreigners is held by the Peoples' Republic of China.?" The question
was asked three times, and three times the Liberals refused to answer.
A straightforward question that should have brought a clear answer. Hide as they have with the McKinsey contracts? By not answering, the logical conclusion is that the Liberals have something to hide.
These Things Run Deep
These things run deep. There is food insecurity affecting almost 1.5 million Canadians, including kids. There is energy poverty, where people are having parts amputated because
Of frostbite; we have First Nation communities that, for years of promises by Trudeau, still do not have drinking water; we have an about-turn on fighter jets,a favourable decision that should have been madeyears ago; we have a healthcare system that is broken; Trudeau's many breaches of ethics,a Minister thathired friends, a deficit on its way northto $2 trillion, bankruptcies creeping up, at least100,000 families that cannot pay theirmortgages, inflation thatis rampant and we have not even seen the worst of it yet.
Is this on anyone's radar? Certainly not our politicians.
Someone said, "It was easy to get into this mess, butgetting out is going to be a hard and painful process."
I wonder when the chickens will come home to roost, and we will begin the painful process.
Best wishes from all of us at Sustainable Circular Economy
Vancouver, Canada
Email: wayne@sustainablecirculareconomy.ca
Wayne Drury is CEO of Sustainable Circular Economy, a boutique firm in Vancouver, Canada, helping businesses and First Nation communities arrive at environmentally sustainable solutions for the people and the planet based on a circular economy of reuse, repurpose, and recycling.