Decreasing Canadian Dollar – What is the Impact on the Workforce? Despite the dismal dollar the workforce in most areas of Canada has maintained its stability.
The Canadian dollar has been on a steady decline for the past year. It began late in 2013 and continues today. In recent weeks, the Canadian dollar briefly dropped to its lowest level since July 2004, changing hands at 74.88 cents U.S. Despite the dismal dollar the workforce in most areas of Canada has maintained its stability. Although the oil and energy sector in Alberta has seen significant declines, other industries including those in research and innovation, and other science, technology, engineering, and math (STEM) related careers, have continued to grow.
The low Canadian dollar is expected to benefit Canadian exporters as it will lead to lowered prices on Canadian exports. This in turn may lead to an increase in demand for Canadian exports in key export destinations, including the U.S. Higher demand for exports would be beneficial for the export-oriented industries, including the manufacturing sector which is vital for Ontario’s economy. The increased demand may also cause an increase in production in industries that are export focused, that may lead to expansion and higher employment in these industries.
For STEM careers, the demand continues to be high. A decreasing dollar puts more pressure on industries driven by innovation to step up to the plate. During the worst economic times, companies based in innovation and scientific creativity are the ones that rise above to achieve success. As the saying goes, if you can survive during economic crisis than you are on the road to unlimited success.
Overall, the depreciating Canadian dollar will have different effects on various sectors of the economy. While the export-oriented sector will probably receive a boost, it may increase the cost of living for Canadians, especially for those in the lower and middle income groups. Also, the overall effect of the declining loonie would depend on how much the dollar depreciates and for how long it remains depressed. That being said, the Canadian workforce remains in good condition and should be able to ride this wave of uncertainty with limited disruptions.
