The Bank’s forgotten mandate: Support maximum sustainable employment

BRUSKE: More balanced economic policies needed to avoid devastating job losses

OTTAWA –– A year after the Bank of Canada received a new mandate, Canada’s unions are asking what happened to the new directions that added employment considerations when the Bank is setting Canada’s monetary policy.

“A year ago, amidst great fanfare, the Bank received direction that Canada’s monetary policy should also support maximum sustainable employment. But the Bank seems determined to manufacture a recession and risk devastating job losses,” said Bea Bruske, President of the Canadian Labour Congress. “Paper is the traditional one-year anniversary gift, which is ironic because it now seems the renewed mandate isn’t even worth the paper it is written on.”

The framework, released December 13, 2021, set out a clear objective to target two percent inflation and that monetary policy should continue to support maximum sustainable employment for the next five years.

“We must address inflation, of course, but policymakers must consider the full consequences of these decisions on people and the economy,” said Bruske. “A recession triggered by monetary policy will mean massive job losses and downward pressure on wages. Remember, our economy is fueled by working people – not just a series of data points.”

Both the Bank and the federal government have their own responsibilities when it comes to setting economic policy. Canada’s unions have been urging the federal government to do its part to help families struggling with the affordability crisis, including by fixing our shattered Employment Insurance system. This must start with restoring temporary EI measures until permanent improvements can take effect.

“Make no mistake, costs these days are through the roof. But without a paycheque you can’t afford to pay for anything,” added Bruske. “We need to urgently expand access to EI, set a universal 360-hour qualifying rule for Regular and Special Benefits and provide up to 50 weeks of Regular EI.”

“As we stand on the precipice of a Bank of Canada manufactured recession, we must not leave Canadians who lose their jobs struggling alone, at the mercy of a broken EI system. Let’s act swiftly to strengthen our EI system so the program is there for the people who need support.”

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