The Factors of Unemployment in Canada - Essay Example

Econ Essay Table of Contents Econ Essay Table of Contents 2 Income inequality in Ontario 3 Causes behind income inequality 3 Remedy of income inequality 4 4.Fourthly, the report also suggests the national government to increase the aggregate volume of tax revenue being earned. Emission of carbon dioxide, for instance, is regarded as one of the most environmentally deteriorating factors. This is the reason why the report suggests the national authorities to impose carbon tax upon the industries (Grant, ‘Ontario needs to pull up its socks: task force’). 5 Conclusion 5 Reference 6 Grant, T. “Ontario needs to pull up its socks: task force”. November 23, 2010. The Globe and Mail. November 26, 2010. . 6 Income inequality in Ontario Ontario, a significant province of Canada, has pathetically been suffering from the clutches of income inequality post the global financial recession. Per capita income in Canada has actually reduced y a massive $6,900 in the year 2009-2010 than what it had been in 2008-2009. It is widely being noted that the province would continue to endure its sufferance as long as the domestic industrial units decide to break out of their stagnant situation. Furthermore, the rate of unemployment in the nation is high as are the extents of looming poverty and high-school drop-out rates in the economy. Ontario’s Task Force has been striving hard to figure out the true picture of the nation in terms of economic progress, competitiveness and productivity. In addition, the committee is also researching upon the ways through which positive changes could be brought about in the nation. Although Canada has emerged out of a recessionary phase, as being claimed by the national government, the aftermath impact of the same has not been eradicated completely. According to the ninth annual report being presented by the Task Force, the rate of economic progress of the region is still much lower than that during the pre-recessional period. The brunt is especially intense upon Ontario which is both the commercial capital and industrial heartland of the nation. The region which is especially dependent upon export revenues is likely to face hardships in future due to a fall in export demands given that the demanding economies still have not recouped from their plight. Its misery is quite anticipated too, as the national government has cut down the targeted rate of economic growth in the next fiscal. Causes behind income inequality Being a victim of hard times, the provincial government is found to be inventing methods to revive the region, which plays a huge role in the economic progress of the nation as a whole, out of troubled waters. Some of the causes being identified in the report generated by the Task Force have been depicted underneath as follows – 1. Poor productivity among Canadian workers, which is why even though they work hard, the quantity as well as quality of the resultant produce is not worth their effort. 2. Poor demand for exports from nations which still are striving hard to recover from the brunt of the financial crisis. 3. High rate of school drop-outs. 4. Growing rate of unemployment that results to a fall in the economic growth rate of the nation. This has direct implications upon the rising rate of poverty in the nation as well. Remedy of income inequality The Task Force on the other hand, has provided remedies for correcting the deficiencies that has led the nation towards experiencing such bad times. The remedial measures that they have suggested clearly reflect that emphasis must be laid towards the eradication of poverty, unemployment as well as improvisation in the educational aspect. Some of the measures that the Committee has suggested have been illustrated underneath - 1. The business houses need to invest a hefty amount in research and innovations. Innovative activities are likely to lead to betterment in factor productivities and hence economic value being produced. It is alleged as well that the government policies being framed in favour of innovative activities are insufficient. High investments in industrial domains can actually lead to betterment in factor productivity, as the report claims it to be. Moreover, it is also suggested that the employers arrange for employee training in fields suitable for their jobs. To keep it in simple words, the national authorities stress upon the importance of technological boosts to improve upon rates of factor productivity. 2. Secondly, it is also suggested that the national government take immediate actions to facilitate good level of education among different cross-sections of the population. It is realised that a large number of national youths can actually guarantee a long term economic growth. Moreover, the Canadian government also views it to be a good channel of fetching money given that they are trying hard to frame schemes which could attract international students as well. 3. Thirdly, the report being generated revealed that poverty is more prevalent among the sections of the population who had either dropped out of school or have immigrated or are widows and pensioners. However, lack of education is regarded as the sole significant factor that spirals poverty within the nation. The importance of high education is especially important in perspective of Ontario given that the region is fast moving out from heavy works that need physical strength to that of jobs requiring good analytical skills. Industries underlying the service sector could be well served by people who are educated enough. Given the reduced demand for heavy works and machinery exports around the world, Ontario needs to reduce its dependence upon such industries. 4. Fourthly, the report also suggests the national government to increase the aggregate volume of tax revenue being earned. Emission of carbon dioxide, for instance, is regarded as one of the most environmentally deteriorating factors. This is the reason why the report suggests the national authorities to impose carbon tax upon the industries (Grant, ‘Ontario needs to pull up its socks: task force’). Conclusion The scenario prevailing in Ontario at present is one that is a striking evidence of the fact that income inequality is one of the most important factors behind unemployment and poverty. In fact there exists a causal relation between them, i.e., higher the rate of poverty and unemployment, higher will be the rate of income inequality in the nation. The ninth annual report being generated by the Task Force suggested an eradication of all the above economic hitches, viz., income inequality, unemployment and poverty through their effort to raise the level of education in the nation. With service sector gaining high importance in the region, it is important for the nation to show concern towards improving the level of education in the nation. In fact, statistics show that the prevalence of poverty is more among the section of the population who had dropped out of schools. The situation in Ontario is alarming given the fact that export demand for its heavy works and machinery has fast been falling, making the nation to gradually incline towards an expanding service sector. Such a decision is actually considered to be a wise one for the provincial government to undertake given the deteriorating situation of Ontario. A recent survey reveals that if statistics core to Ontario are excluded from that of aggregate Canada, it will result to a rise in per capita income of households by a margin of $10,000. Expansion of the service sector on the other hand, would imply a progress in the field of technology. Hence, technological advances are important to bring an end to income inequality along with every other economic hurdle which comes along with the former. However, had the economy of Ontario been already rich in technological innovations, the deficiency could not be observed as prominently. Hence, some amount of inequality is necessary to motivate the lagging section towards improvement. Reference Grant, T. “Ontario needs to pull up its socks: task force”. November 23, 2010. The Globe and Mail. November 26, 2010. . Read More