An interesting dichotomy seems to exist in the Canadian economy today. While Canada (mainly Ontario) lost 31,000 jobs in July, the real estate market soared some 20% to record setting levels. So luckily, we no longer need jobs since our houses are earning us $150k/year as we live in them! And it’s a good thing too, because the job market is pitiful. One might expect that as a health care professional, I’d be able to avoid the job market gloom… but you’d be mistaken. Check out a locum pharmacist listing I stumbled across:
Shoppers Drug Mart::
Location: Etobicoke/Mississauga, ON*
Dates and Times: August 6 (3pm-10pm)
Technician: Leaves at 6pm
Rate: $31/hr not incorporated and $33/hr for fully incorporated
*Ontario: where dreams and high paying jobs go to die
Now, I work on the Mississauga/Etobicoke border and earn about $50 per hour. This figure is not inclusive of my health, dental, drug, or vacation benefits, nor my 6% pension match. So if I were a new grad looking for work today, I’d be expected to earn 60% of my current wage, live without benefits and accept a measly 7 hour shift on a Saturday night. Not to mention, I’d have to get into a bidding war for dilapidated, post-war Etobicoke bungalow or an overpriced shoebox condo overlooking a highway. So, in summation, no thank you. My employer, however, is likely salivating at the thought of a new flock of heavily indebted recent grads with student loans, leased luxury cars and exorbitant mortgages, willing to work sans-benefits for $31 per hour. I know that my job is hardly secure, which is why I’m using my contrarian nature to prepare for the inevitable day of reckoning.
By using the lowest interest rates in history to gorge on residential real estate, Canadian households are now the most indebted of the G7. In Ontario, our Liberal government has bungled their way to a debt-to-GDP ratio above 40%, trumping basket case California in their heyday. Eventually, interest rates will creep upwards and public & private debt levels will limit future consumption and lead us into a recession. The whole house of cards would have collapsed long ago if not for government goosing the sector by allowing CMHC to backstop loans for poor people and banks offering sub-inflation mortgage rates.
The rational part of my brain is painfully aware of the Great Canadian Housing Bubble. So why then, am I spending my Sunday afternoon hitting up open houses? ¯\_(ツ)_/¯ More on this later…