Through its website and daily newsletters, The Peak (a ZoomerMedia property) offers Canadians the news they need to understand business, tech, and other must-know stories.
In this dispatch, The Peak looks at the potential effects AI will have on Canada’s economy, the country’s growing dependence on private nurses and how the growth of our skin care market is attracting buzzy, new beauty brands to Canadian stores.
The Bank of Canada Has Some Questions About AI
The guy in charge of watching over Canada’s economy isn’t totally sold on AI.
What happened: Bank of Canada governor Tiff Macklem offered his first public thoughts on AI and its potential impact on the economy, and he painted an uncertain picture that will take years to come into full focus.
- On the plus side, Macklem said AI could boost the economy by automating tasks, freeing up workers to take on more productive jobs, and creating new products or services.
- On the other hand, AI could eliminate more jobs than it creates. It could also contribute to inflation, be it through building infrastructure, or investments boosting equity prices and, by extension, consumption.
- Somewhere in the middle was the fact that it will be some time before any economic impacts are seen, or the possibility that AI will simply keep productivity going at its current pace, instead of significantly increasing it.
Catch-up: Productivity is a driving force for AI adoption. Person-by-person, companies hope AI can take on menial tasks to free up humans for more profitable work. In the big-picture way that Stats Canada defines productivity, the likes of TD and the Conference Board of Canada have said AI could help fix Canada’s “productivity problem.”
- Canada’s productivity — calculated as GDP created for every hour worked — has either been stagnant or declining for several years, an “emergency” caused in part by low business investment and competition.
Why it matters: Macklem’s view on AI was tempered, but the fact that he is even keeping an eye on the broad economic impact of automation is a departure from big tech companies and their customers, who’ve downplayed the job loss AI could result in, or maintained that the good would outweigh the bad.
Zoom out: Macklem pointed out that new tech doesn’t typically cause mass unemployment, but AI could be different as it gets more capable and deployed at scale. That impact shouldn’t be underestimated; fast food restaurants, for example, are keen on bringing AI to their locations, and replacing even 10% of their nearly 400,000 workers in Canada would impact unemployment. — Josh Kolm
Canada’s Private Nurse Dependency is Growing
Amid a shortage of public nurses, more tax dollars are being thrown at private agencies offering to step in for five times the price.
Driving the news: Canadian hospitals and nursing homes paid at least $1.5 billion to for-profit nursing agencies in the past year, according to new research out of Queens University, a staggering six-fold increase from 2020.
Why it’s happening: During the pandemic, nurses retired or flocked to higher-paying private agencies en masse, forcing many provinces to pay up for temporary nurses to meet staffing needs. That reliance on private nurses has only grown post-pandemic.
- In just four months last year, Newfoundland spent $35.6 million on private nurses, up from an average of just over $1 million a year before the pandemic.
Why it matters: Private nursing is pricey and may not be a sustainable solution given an expected shortage of ~115,000 nurses by 2030. Some experts say that $1.5 billion could go a long way to recruiting and retaining public nurses.
- Québec is already working to ban these agencies, while Ontario, Alberta, B.C., and the Atlantic provinces are all ramping up efforts to recruit more foreign-trained nurses.
Bottom line: Cutting off private nursing agencies entirely could lead to emergency room closures and major surgery backlogs, but continuing to lean on them will incentivize more nurses to go the private route and exacerbate shortages in the public system. — Lucas Arender
More Brands Want in on Canadian Skincare Routines
The competition is heating up for cosmetics brands trying to win a coveted spot in your 10-step nightly skincare routine.
Driving the news: Popular luxury U.K. skincare brand ELEMIS has expanded to Canada and will now be sold at Sephora locations across the country. The L’Occitane-owned brand is part of a recent flood of entrants to Canada’s cosmetics market.
- This year has seen a wealth of buzzy beauty brands come to Canadian stores, including person of colour-focused brand Ami Colé and Naomi Watts-backed Stripes.
Why it matters: Global beauty brands have set their sights on Canada as a prime expansion target, and for good reason. The market continues to flourish even as other retail segments falter — growing 18% between January and September of last year, per Circana.
- Skincare products, in particular, have been taking off (we blame “skinfluencers” for making us all self-conscious about the lack of magical serums in our lives). Skin products are now the fastest-growing product category for Sephora in Canada, per Glossy.
Zoom out: Domestic brands have also been benefitting from the industry’s glow-up. Luxury giant Estée Lauder bought out Toronto-based Deciem for US$1.7 billion in June, while Swiss chemicals firm Clariant sealed its $810 million purchase of Québec-based Lucas Meyer Cosmetics in April. — Quinn Henderson
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