10 ). the unemployment rate remains above its pre - crisis decade average. the duration of unemployment also remains above its pre - recession average and the number of people working part - time who would prefer to work full - time has come down only slowly. and the behaviour of wages is not pointing to generalized excess demand for labour. wage growth has been modest ( chart 11 ). the labour market is an important component of the bank ’ s assessment of the amount of excess supply in the economy. we continue to monitor the full range of labour market indicators, together with other relevant information, very closely as we seek to achieve the 2 per cent inflation target. to the extent that the economic expansion continues and the excess supply in the economy is gradually absorbed, some modest withdrawal of the present considerable monetary policy bis central bankers ’ speeches stimulus may become appropriate, consistent with achieving the 2 per cent inflation target over the medium term. the timing and degree of any such withdrawal will be weighed carefully against domestic and global economic developments. the future labour market in the five years since the start of the financial crisis, the most significant labour market challenge has been creating enough good jobs for workers. over the next five years, the most important challenge is more likely to be finding enough good workers for jobs. even with some slack remaining in labour markets, firms are reporting – with increased frequency – difficulty in attracting suitable labour. our own business outlook survey indicates that labour shortages have gradually moved up across the country. and in the latest survey of small and medium - sized businesses by the canadian federation of independent business, “ shortage of skilled labour ” has moved ahead of “ insufficient customer demand ” as the top business constraint facing their members. 4 looking ahead, canada ’ s demographic trends will compound the scarcity of labour. 5 we are getting older, living longer and having fewer children. that means more workers retiring and fewer people to replace them. this will put upward pressure on wages and lead to adjustments to the composition and the nature of the labour force. for firms, attracting talent while retaining relevant expertise and institutional knowledge will be more challenging. confronting this challenge requires working on three margins : expanding the labour force ; utilizing it more efficiently ; and increasing labour productivity. let me address each of these in turn. expanding the labour force several segments of the labour force have potential for greater labour market participation. let me highlight three. first, older individuals may be enticed to stay longer in the workforce. indeed, this is already happening. the labour

canada ’ s april 2012 monetary policy report. bis central bankers ’ speeches in addition, growth is expected to continue in the period ahead – at 2. 4 per cent in 2012 and 2013, easing to 2. 2 per cent in 2014. these growth rates may seem relatively modest, but over the 2012 to 2013 period, they are somewhat above the rate at which the potential of the economy is expanding, estimated at 2 per cent in 2012 and 2. 1 per cent in 2013. as a result, we expect the canadian economy to return to full capacity by early next year ( chart 6 ). bis central bankers ’ speeches most of the growth in the period ahead is expected to come from private domestic demand. in particular, that growth relies on continued spending by canadian households on consumption and housing. it also reflects a continued strong rise in investment spending as canadian firms seek to expand, replace, and modernize their capacity. on the other hand, we are still seeing weak growth in canada ’ s net exports. that in turn reflects factors i mentioned earlier : notably the protracted recovery of demand in the united states, canada ’ s major trading partner, and canada ’ s weak competitiveness. the bank forecasts that canada ’ s exports will regain their pre - recession peak only at the end of 2013. in contrast, the level of imports has already regained its pre - recession peak. this divergence has contributed to a decline in canada ’ s current account balance, which has dropped from a pre - recession surplus to a deficit of approximately 2 per cent of gdp – a trend that is projected to persist ( chart 7 ). oil prices are one important factor underlying the economic outlook for canada – and here is a story in which transport has been playing an important role. canada as a whole usually benefits when oil prices rise. as a net oil exporter, canada gains from higher incomes in the industry, higher production and investment and the resulting spillovers to other parts of the economy. those benefits typically outweigh the effects of more expensive gasoline on the cost of living and the effects on production costs. in recent months, this balance of costs and benefits has shifted because of an unprecedented spread between the price of oil that canada imports and the price of oil that canada exports – a spread that peaked at about $ 50 a barrel earlier this year ( chart 8 ). there are many reasons for this, some of which are temporary. growing global demand – especially from emerging - market economies – together with supply disruptions