Eagle Vision Quarterly Newsletter

September 2012

Richard L. Simms
President, Black Eagle Executive Search


Labour markets in both Canada and the U.S. were largely unchanged in September 2012 as per reports below:

Statistics Canada, October 5, 2012:

 “Employment increased for the second consecutive month in September, up 52,000, mainly in full-time work. The unemployment rate rose 0.1 percentage points to 7.4% as more people participated in the labour market.”

The U.S. Bureau of Labor Statistics, October 5, 2012

 “The unemployment rate decreased to 7.8 percent in September, and total nonfarmpayroll employment rose by 114,000, the U.S. Bureau of Labor Statistics reportedtoday. Employment increased in health care and in transportation and warehousing but changed little in most other major industries.”

The housing market in Canada is showing a moderating trend as noted by CMHC:

OTTAWA, October 9, 2012 — Housing starts in Canada were trending at 224,419 units annually in September, according to Canada Mortgage and Housing Corporation (CMHC). The trend is a six month moving average of the seasonally adjusted annual rates (SAAR)1 of housing starts. The standalone monthly SAAR was 220,215 units in September, down from 225,328 in August.

“Housing starts in September were largely in line with the latest trend figure. The monthly decrease posted in September was mostly due to a decrease in urban multiples starts. As expected, the number of multiples starts in Ontario, particularly in Toronto, reverted back to a level more in line with the average pace of activity over the last six months,” said Mathieu Laberge, Deputy Chief Economist at CMHC. “Following a period of elevated housing starts activity due to strong volumes of multi-family unit pre-sales in 2010 and 2011, the pace of housing starts is expected to moderate.”

In the U.S. the National Association for Realtors economic housing forecast of September 27, 2012, a modest recovery is under way.

Latest and Forecast: Existing home sales have been rising roughly at 8% to 10% from comparable period one year ago. Shortage of inventory in some markets and excessively tight underwriting standards are holding back potentially bigger gains. Sales will rise to nearly 5 million in 2013.

 The inventory of newly constructed homes continues to fall, essentially at a 50-year low. The existing home inventory has also been falling, with today’s levels at the lowest since 2005.

Overall economic activity is still slow with Canadian GDP growth for 2012 having been downgraded to 1.9% growth, and U.S. GDP growth forecast at 2.1%

Global growth is slowing because of two large markets, the U.S having slow growth, and Europe in recession.

Overall employment prospects presently in Canada are thus not particularly bright, and there is very little movement of personnel, particularly in senior management levels. Most employers are taking a cautionary stance to hiring and taking a “wait and see” attitude to the Canadian and world economy. This is slowing both employment and capital expenditures.


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