Canada adds 90,000 jobs, BoC warns of higher mortgage payments and energy-hungry AI models: Must-read business and investing stories

Getting caught up on a week that got away? Here’s your weekly digest of the Globe’s most essential business and investing stories, with insights and analysis from the pros, stock tips, portfolio strategies and more.

Canada adds 90,000 jobs in April as unemployment rate holds steady

Canada’s economy added roughly 90,000 jobs in April – much higher than a gain of 20,000 jobs that many economists were predicting – according to Statistics Canada’s latest Labour Force Survey numbers. Despite those gains, the unemployment rate held steady at 6.1 per cent. The stronger-than-expected report prompted a reassessment from both economists and money markets on when Bank of Canada’s interest rate cuts could begin, Matt Lundy reports. On Friday, markets were pricing in a roughly 50-50 chance that the central bank will trim its policy rate by a quarter-point on June 5. In recent days, those odds were higher than 70 per cent.

Bank of Canada warns of steep jump in mortgage payments

The other major Bank of Canada headline this week offers up some bad news for homeowners. In its annual Financial Stability Report, the central bank warned that homeowners who are due to renew their mortgages over the coming years will face steep jumps in payments. The report also said that the median monthly payment will increase by more than 60 per cent for those with a variable rate mortgage. Governor Tiff Macklem pointed out the risks during a press conference about the report: “If more Canadians lose their jobs, the unemployment rate goes up, all of a sudden that stress, that vulnerability is really at risk of crystallizing. More households won’t be in a position to pay that mortgage, particularly given the larger reset. So it is a vulnerability. And the point here is households and banks need to get ahead of that. We know what’s coming.”

Decoder: How many real millionaires live in Canada’s biggest cities?

Which of Canada’s largest cities have the most real millionaires? An annual study tallying up the wealthiest cities in the world by their number of liquid millionaires – individuals with liquid investable wealth of US$1-million or more – lists three Canadian cities. Toronto was given the 13th spot on the global list released by immigration consulting firm Henley & Partners with roughly 106,000 real millionaires. Vancouver, given the 31st spot, had just over 41,000 liquid millionaires, while Calgary, given the 57th spot, had 15,000 liquid millionaires. Although it was not included in the report, the authors found that Montreal had approximately 17,500 millionaire residents. Jason Kirby takes a closer look at the figures – including which city comes out on top on a population basis – in this week’s Decoder.

Warren Buffett’s Berkshire Hathaway mulls major new investment in Canada

Warren Buffett’s Berkshire Hathaway Inc. is mulling options for a new foray into Canada, Brent Jang reports. Members of the leadership team, including Mr. Buffet, spoke about the advent of a major new investment in Canada during the company’s annual meeting. “We’re always looking at making incremental investments there because it’s an environment we’re very comfortable with,” said Greg Abel, vice-chair of Hathaway’s noninsurance operations. The company’s assets north of the border include Calgary-based Berkshire Hathaway Energy Canada, which operates 13,000 kilometres of transmission lines and 300 substations in Alberta through AltaLink.

Energy-hungry AI models could strain water and power grids. Can the sector handle the demand?

Have you ever thought about how much energy and water it takes to power up AI models? Spoiler alert: It’s a lot. AI data centres are thrumming with electricity to power supercomputers. The supercomputers themselves are built with an array of sophisticated chips made with silicon and copper – all mined from the earth. The facilities radiate intense heat, and large volumes of water are needed to keep them from overheating. And, as we enter a new era of generative AI, the world will need more supercomputers, more data centres and more energy. Joe Castaldo set out to speak to experts on how to support AI’s development without taxing resources, straining power grids and causing environmental harm.

Ontario’s Sunshine List is mostly a list of people who can’t afford to buy a home

Ontario’s recently released Sunshine List of government sector employees earning more than $100,000 has a whopping 300,570 names. But that’s just a long list of people who probably can’t afford to buy a home, Preet Banerjee argues. He calculates what the six-figure salary meant in 1996, when the list was first released, and what it means in 2024 adjusted for inflation. A salary of $100,000 in 1996 would be the equivalent of $180,564.97 in 2024. His conclusion: The government should look at resetting the threshold to a number that makes more sense today.

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