Ontario Federation of Labour

Ontario Federation of Labour

October 21, 2008 11:41 ET

Tough Economic Times Call For Bold Leadership

OFL Calls for Concrete Action in Fall Economic Statement

Attention: Assignment Editor, Media Editor, News Editor, Government/Political Affairs Editor TORONTO, PRESS RELEASE--(Marketwire - Oct. 21, 2008) - The provincial government must use tomorrow's fall economic statement to announce bold actions to respond to the economic turmoil facing Ontario said Ontario Federation of Labour President Wayne Samuelson.

Samuelson is calling on the government to speed up infrastructure investment, make a down payment on its poverty reduction strategy, increase support for Ontario's struggling businesses and workers, and, bring together all the players to work together on solving our economic problems.

"We need real economic leadership from government in this troubled time. We need concrete actions to support industries and workers who are in trouble; to invest in productive capacity for the future prosperity of the province and increase protection for those who are most vulnerable," he said.

Tomorrow, said Samuelson, the government should put forward a concerted strategy to draw on the collective strength of all the players in Ontario's economy, speed up much needed public investments, and increase protection for Ontarians. These investments will be much more effective than tax cuts in stimulating the economy. The Ontario Federation of Labour will be looking for the following in the fall economic statement:

* Maintain all current and planned spending on government services;

* A substantial down payment on the government's poverty reduction strategy through new investments in affordable housing and increased benefits for low-income Ontarians;

* Speed up planned infrastructure investments to take up expected slack in construction activity. At the same time, the government should use this opportunity to set aside its P3 financing policy for public infrastructure investments;

* Increase assistance to help Ontario's industries weather the current economic storm; and, improve adjustment assistance to workers who have lost their jobs. A "Buy Ontario" procurement policy would be a crucial part of this effort; and

* Establish a Labour Market Partners Forum with representatives from government, business and labour. Its short-term focus would be on strategies to help Ontario workers and businesses through the current economic situation. Its longer-term focus would be to help Ontario strengthen its economy; and focus on environmentally-sustainable, high value-added economic activity that provides good quality jobs for Ontarians.

The global financial crisis and further weakening of the US economy is compounding and spreading the crisis in Ontario's manufacturing and forestry sectors. More than 200,000 jobs have been lost in these sectors since 2005. This malaise is spreading to financial services and construction sectors that have been the underpinning of recent economic growth in the province. The most recent data available show that Ontario's anemic growth of 0.3 per cent in the second quarter was dependent on private sector growth in construction, financial services, and retail trade. In that quarter, manufacturing output shrank by 1.2 per cent, after shrinking by 4.3 per cent in the first quarter.

Economists agree that public spending cuts to balance the budget would be bad policy at this time, as it would further weaken the economy. The Finance Minister and Premier have heeded this advice, and indicated that a deficit is likely for this year.

However, a stand pat response is not enough. The government must and can take bold action. It has the resources to do so. Ontario's debt to GDP ratio has been trending downward for eight years. After peaking at 32.9 percent in 1999-2000 it is down to 18.1 per cent in 2007-08. Now is the time to draw on the spending room that this fiscal prudence has provided the Province.

"The commitments that the OFL is calling for would provide necessary fiscal stimulus, increase the productive capacity of the province, maintain income and skills of workers, and assist those who are living in poverty," said Samuelson.

cope343 /For further information: Wayne Samuelson, President
Ontario Federation of Labour
416.571.7408 (cellular)/ IN: ECONOMY, FINANCE, LABOUR, MEDIA, POLITICS

Contact Information

  • Sheila Block, OFL Research Director
    Primary Phone: 416-441-2731 ext. 655
    Secondary Phone: 416-443-7655
    Toll-Free: 800-668-9138