Cut interest rates to provide relief to families

May 2, 2024

OTTAWA––Cutting interest rates to provide relief to workers and families is urgently needed in the wake of rising unemployment and Canada’s underperforming economy, according to CLC President Bea Bruske.

The unemployment rate jumped to 6.1% in March, a cumulative increase of a full percentage point over the past year. Meanwhile, GDP numbers released this week came in well under expectations.

“High interest rates just slam the brakes on the economy. Starting to cut rates in June isn’t like suddenly hitting the gas. It just means easing off the brakes just a little bit to provide some relief to families struggling to pay their rent or mortgages,” declared Bea Bruske, President of the Canadian Labour Congress. “How many more workers have to lose their jobs or default on their mortgages before the Bank of Canada does the right thing and cuts interest rates?”

Bruske added that some are getting hit harder by this economic slowdown. According to Statistics Canada, racialized Canadians are seeing higher job losses. The unemployment rate for Black Canadians rose 3.9 points over the past year to 10.8%. Meanwhile younger 15- to 24-year-old workers saw the steepest losses with 28,000 net jobs lost just in March while the youth unemployment rate rose to 12.6%.

“The longer the Bank of Canada delays cutting interest rates, those with the least will suffer the most,” warned Bruske. “The Bank of Canada must not sacrifice those who have the least power on the altar of high interest rates. It’s past time the Bank of Canada cuts interest rates and starts loosening the reins so Canada’s job market and economy can start to grow again.”

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