Jerbs, jerbs, jerbs
What the latest jobs reports says about our economy
Good morning. Last week, OpenAI unveiled ChatGPT, the buzzy AI chatbot that uses natural language processing to answer questions and explain concepts (in other words, a chatbot that can do a mouthful). It's free to use and you can play around with it to answer some of the burning questions of our time (what is time?) or write some neat prose.
In this edition:🛩 Ready, set...💼 Cover letters are in
— Vindhya Kolluru, Editor
Your next getaway will be pricier than the rest
With the holiday season in full swing, you may already have started planning a trip back home or are browsing flights to take your mind off of Noodle the pug dying (RIP 😢 It will forever be a bones day). While there were some good Black Friday deals from Canada's newest budget airline, flying within the country is still so expensive and expected to get worse.
Some context: To understand why the Great White North is one of the most expensive places to fly, let’s break down what a plane ticket price includes. The fees are divided between the passenger and the airport. Passengers foot expenses for airport improvement fees, security charges and taxes which can account for more than 35% of the total costs of a flight. (That excludes an overpriced water bottle and the latest Vogue issue detailing Bennifer’s relationship.) Airports are also required to pay rent to the feds and foot other costs of maintaining the infrastructure.
For reference, in 2019, Toronto Pearson paid $171 million dollars in rent. Canada’s not-for-profit system, funded by travellers, differs from others around the world that are sustained by taxpayers, for-profit companies, or a combination of other sources.
The bottom line: The pandemic impacted air travel hard, and a system that relies on passengers as the main source of revenue means that the cost of jet-setting will continue to increase to make up for the deficit over the past two years. We're already starting to see the impacts of this at Canada's busiest airport: Toronto Pearson is set to increase the airport usage fee by $5. It's less than the price of a grande Starbucks latte (hello inflation), but the $40+ tax fee will be passed directly to departing passengers from Pearson.
— Sabrina Dotsch
Jerbs, jerbs, jerbs
Our country's unemployment rate dropped to 5.1% as of November 2022, down from 6.1% a year ago. Normally this drop would be seen as a very good sign — jerbs ftw — but it comes as the Bank of Canada has been cranking up interest rates in an attempt to slow the economy and tackle stubborn inflation (which is still hovering around 6.9%).
Despite unemployment trending towards record lows, the labour market remains piping hot.
So, what’s with the mixed signals? Bank of Canada governor Tiff Macklem has said the low unemployment rate is unsustainable, suggesting that it’s contributing to high inflation, yet the labour market remains strong. So strong that 81.6% of core-aged women (those 25-54) are employed, a record high. But in the presence of a rising cost of living, is that …good? If you feel like nothing in the economy seems to make sense, you’re not alone.
Economic indicators seem misaligned, like the once-booming housing market that is now kind of all over the place. Home prices have dropped: 11% in the GTA but are up 19% in Halifax. And the U.S. is experiencing similar economic weirdness in the form of an erratic housing market, strong consumer spending and high job numbers.
Why it matters: At this point, we’re firmly in the long tail of the COVID pandemic and it’s worth remembering that unemployment peaked at 13.7% in May 2020. While fears of a recession are out there, they remain mixed because a major economic contraction hasn’t happened...yet.
What's next: Just last week, Goldman Sachs put out an upbeat-ish outlook for Canada in 2023, suggesting that we would avoid recession and that rates would decrease. Until then, all 👀 are on the Bank of Canada’s next rate hike announcement on Wednesday and employment numbers after the holidays.
— Paisley Sim
Other things we read and we liked
🔥 How Alex Cooper's podcast, Call Her Daddy, changed the audio game.
💬 Texting yourself should be embraced more often.
$ Flat-screen TVs, earbuds and...personal data? How your personal data might've been put on sale for Cyber Monday.
😱 This corner of the Internet is now a T-Swift fan club. Love to see it.
🏦 The riveting story of one person who turned $15,000 into over $1 million by investing in risky stocks, and then lost it all.
🤝 Now hiring
Speaking of jerbs...
Hey, you made it to the end! What did you think of today's newsletter?
If you have more detailed feedback for us, send us a note at [email protected]. We'd love to hear from you.
Have something or someone we should know about? Reply or email [email protected] to let us know!