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Wednesday, 17 December 2008

582,000 Canadian jobs at risk

TORONTO - CANADA could lose more than 580,000 jobs within five years if Detroit's Big Three automakers go out of business, according to a Ontario government commissioned report.

The review, prepared for Ontario's Ministry of Economic Development and released on Tuesday, warns that the collapse of General Motors Corp, Ford Motor Co and Chrysler LLC would send lasting shock waves through the economy.

If auto output by US-based manufacturers in Canada were cut in half, at least 157,400 jobs would be lost right away, 141,000 of them in Ontario.

By 2014, job losses would rise to 296,000 nationally, including 269,000 in Ontario.

If production were to cease completely, 323,000 jobs would be lost immediately in Canada, including 281,800 in this province, rising to 582,000 nationally and 517,000 in Ontario by 2014.

The Ontario Manufacturing Council, a provincial government panel, commissioned the 11-page report, which was prepared by the Center for Spatial Economics.

The report paints a gloomy picture if the provincial government and Ottawa and Washington do not bail out the US automakers.

Ontario Economic Development Minister Michael Bryant said on Tuesday a proposed $3.4 billion Canadian (S$4.09 billion) rescue package is needed to avoid a 'catastrophic' chain of events.

Mr Bryant said Canada 'is better off providing life support to GM and Chrysler, because the demise of auto in Canada is the economic equivalent of a nuclear freeze with catastrophic effects that would knock us into a deep recession'.

Canadian Federal Industry Minister Tony Clement said last week that Ottawa and Ontario will provide the equivalent of 20 per cent of whatever emergency aid the Bush administration gives to the companies - a figure proportional to the number of vehicles produced in Canada. -- AP

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