Dawn Desjardins, chief economist at Deloitte Canada, and Ryan Lewenza, senior vice president and portfolio manager at Turner Investments at Raymond James, join BNN Bloomberg to discuss the labour market in Canada that added over 63 thousand jobs in September.

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As the world continues to grapple with the economic repercussions of the ongoing pandemic, economists are closely monitoring the global financial landscape for any signs of a deep dark recession. However, what they see instead is a slow growth scenario unfolding.

The term ‘deep dark recession’ refers to a severe economic downturn characterized by a steep decline in GDP, high unemployment rates, and a prolonged period of economic stagnation. It is a term that evokes memories of the Great Recession of 2008, which had a devastating impact on economies worldwide.

While the pandemic has certainly disrupted economies, leading to job losses and a contraction in various sectors, economists argue that the nature and scale of the crisis are different from previous recessions. Unlike the financial crisis of 2008, which originated in the banking sector, the current crisis stems from a health crisis.

Governments around the world have implemented unprecedented fiscal and monetary stimulus measures to mitigate the impact of the pandemic. These measures, such as large-scale stimulus packages and monetary easing, have helped soften the blow and prevent a complete collapse of the global economy. The result is a slow growth scenario rather than a deep dark recession.

Economists believe that the recovery will be gradual rather than rapid. The unpredictability of the virus and the challenges posed by new variants have made it difficult to accurately predict the trajectory of economic growth. However, there are several factors that support the argument for a slow growth scenario.

Firstly, the global vaccination campaigns have gained momentum, leading to increased confidence among consumers and businesses. As more people get vaccinated, there is a gradual return to normalcy, with economies reopening and demand for goods and services picking up.

Secondly, central banks have adopted accommodative monetary policies, keeping interest rates low and ensuring ample liquidity in the financial system. This has helped support businesses and encouraged borrowing, which in turn fuels investment and economic activity.

However, it is important to note that the slow growth scenario does not mean that all sectors or regions will recover at the same pace. Some industries, such as travel and tourism, hospitality, and retail, have been hit hardest by the pandemic and may take longer to bounce back. In contrast, sectors like technology and e-commerce have thrived during the crisis and are well-positioned for growth.

Additionally, the recovery is also dependent on factors such as government policies, trade dynamics, and geopolitical tensions. Any adverse developments in these areas could potentially derail the slow growth trajectory and lead to a more severe downturn.

While a deep dark recession has been a possibility that economists have been cautiously monitoring, the current data and trends suggest a slow growth scenario instead. The combination of government stimulus measures, increased vaccination rates, and accommodative monetary policies are underpinning the recovery, albeit at a gradual pace. However, it is crucial to remain vigilant and adaptable as the economic landscape continues to evolve in response to the ongoing pandemic.