Forward Together

As we head into the holidays, Canadians are struggling after being hammered by aggressive interest rate hikes

December 21, 2022

Bruske: In 2023, Parliament needs to focus on the true causes of inflation and address the affordability crisis Canadians will continue to face

Today’s numbers are further evidence that inflation is already slowly moderating in Canada. Yet again, Canada’s unions are calling on the Bank to pause its tightening cycle and avoid further hiking rates.

“The Bank’s rapid and aggressive rate hikes will have colossal impacts on workers and their families. Raising rates may eventually squeeze inflation out of our economy—but the cost is sky-high. The Bank’s actions could cause an enormous rise in unemployment, personal and corporate bankruptcies, and could potentially initiate a financial crisis,” said Bea Bruske, President of the Canadian Labour Congress. 

The Bank needs to let the impact of previous rate hikes take hold before taking further action, in order to avoid a damaging recession. If the Bank continues down this path, it risks heavily weakening our economy and throwing hundreds of thousands of Canadians out of work. 

“The Bank of Canada Governor is bound and determined to reach the two percent target for inflation, knowing full well it would cause a rise in unemployment, leaving workers across Canada struggling to pay for basic necessities for many years to come,” said Bruske. “The Governor says he knows Canadians are struggling and feeling the pain of inflation and the strain of increased interest rates. But policy makers, including Governor Macklem, must remember that their decisions have serious consequences for real people who risk losing their homes because they can’t make their skyrocketing mortgage payments. This is not a theoretical debate about monetary policy,” added Bruske. 

Adding to this, workers and their families are continuously seeing food and housing prices rise while their wages are still lagging behind inflation. Canadians don’t need to see their paycheques stretched even thinner—they need the government to play a role in helping families through this cost-of-living crisis.

Canada’s unions are urging the Bank and the Government of Canada to focus on the ongoing affordability crisis. This should start with reforming the outdated EI program and concrete actions targeting excess profits and corporate price mark-ups.   

“We hope that in the new year, Parliamentarians will act urgently to make profiteering corporations pay their fair share while addressing the problem of concentrated corporate power that is allowing companies to raise prices as much as they want,” said Bruske. “Investing that money back in programs like pharmacare, child care, and long-term care will help alleviate some of the costs families face, ultimately helping reduce the impacts of inflation,” added Bruske. 

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