The following is a guest post by Nick Fillmore.
National business journalists and columnists have bought into Prime Minister Stephen Harper’s demeaning view that folks in the Atlantic region are backward and have a defeatist attitude. Framed in contemptuous language, they’re promoting untested economic ideas that, if adopted, would seriously damage the economy – and the people – of the region.
Apparently it wasn’t enough for elite business journalists to applaud how Harper has made life far more difficult for many already struggling seasonal workers by cracking down on employment Insurance (EI). They are advocating the elimination of EI for (Read more…)
This morning, Statistics Canada reported an apparently decent month of data for April, with a modest increase in employment, all full-time and all in paid positions rather than self-employment. Despite this seemingly good news, the total number of Canadians participating in the labour force edged down.
As a result, the participation rate declined to 66.5 per cent in April, matching February 2012 as the lowest participation rate recorded since April 2002. In other words, fewer than two-thirds of Canadians over the age of 15 are now employed or looking for work.
While official unemployment has remained at 1.4 (Read more…)
The real unemployment rate for Canadians over 25 was 8.8% in April. Not great, for sure, but slightly better than it was in 2009.
For youth 15-24, it was up from last April – to 20.9% – so more than 1 in 5 youth are looking for work and can’t find it. In Ontario, it’s closer to 1 in 4, and in PEI it’s 1 in 3.
If we look at the participation rate of youth aged 20 to 24, we see that it’s actually fallen by 2 percentage points since the trough of the recession in July (Read more…)
Brian Lee Crowley’s latest column shows he’s a glass-half-full kinda guy. We shouldn’t be worried about unemployment because a) it’s old-fashioned, b) Boomers had it worse (and now they’re getting old) c) we’re doing better than the U.S., and d) it’s really only young people and immigrants that are unemployed.
This is a relief.
So I shouldn’t worry that Statistics Canada Labour Force Survey indicates that real average hourly wages have risen by only twenty cents between 2009 and 2012 (an annualized growth rate of 0.3%). Or, that at the same time, real median hourly wages have (Read more…) fallen, indicating that any wage growth is limited to a few at the top end.
Crowley cites vague evidence from internet job advertisements to point out that the number of jobs going unfilled are rising fast.
That’s good news for Canada’s 1.3 million job seekers. They had been discouraged by Statistics . . . → Read More: The Progressive Economics Forum: Crowley’s Red Hot Labour Market
On Tuesday, Statistics Canada reported that job vacancies have fallen to the lowest level recorded since it began collecting these figures two years ago.
On Wednesday, the Bank of Canada projected growth of just 1.5% for this year.
On Thursday, Statistics Canada reported that the number of Canadians receiving Employment Insurance (EI) benefits edged down in February. Meanwhile, the Labour Force Survey indicates that unemployment edged up in February and grew much worse in March.
The combination of rising unemployment and falling EI receipts reduced the proportion of unemployed Canadians receiving benefits to 39.7 per cent in February (Read more…).e. 528,940 beneficiaries out of 1,332,600 unemployed workers). This reduction in EI coverage comes on the heels of new EI restrictions that make it harder for jobless Canadians to access benefits.
This morning, Statistics Canada reported flat wholesale trade and low inflation, providing further evidence of a subdued Canadian economy. Federal . . . → Read More: The Progressive Economics Forum: A Weak Week for Canada’s Economy
Armine and I have some comments in today’s Toronto Star article on Temporary Foreign Workers (page B1). Armine has been commenting extensively on this issue and my head talked for a few seconds on last night’s The National. Here is my online Globe and Mail op-ed:
Reining In The Temporary Foreign Worker Program
Reports of RBC outsourcing jobs to temporary foreign workers to replace existing Canadian employees should prompt a broader debate about the massive expansion of the Temporary Foreign Worker Program in recent years. Is this program addressing genuine “labour shortages” or undermining job opportunities and wages in Canada?
The number of temporary foreign workers in Canada has more than doubled since the Harper government took office. The Department of Citizenship and Immigration reports the presence of 338,000 temporary foreign workers at the end of 2012.
This temporary work force is now almost as large as New Brunswick’s entire . . . → Read More: The Progressive Economics Forum: Temporary Foreign Workers
The headline numbers are bad enough: “employment declined by 55,000 in March, all in full time. The unemployment rate rose 0.2 percentage points to 7.2%.”
The underlying numbers are ugly. The employment decline would have been worse but for a large jump in self-reported self-employment. The number of employees with positions paid by an employer actually fell by 93,100 in March (partially offset by 38,700 more Canadians reporting self-employment).
Official unemployment would have increased even more but for 12,300 Canadians dropping out of the labour force altogether and consequently not being counted as unemployed.
Average wages rose
The Nova Scotia provincial government is set to introduce its promised balanced budget this year. The Nova Scotia Alternative Budget, released today, proposes some concrete choices rooted in Nova Scotia communities. Rather than pay down debt, the NS-APB prioritizes balancing the social debt threatening Nova Scotia.
Can a budget really be considered balanced when unemployment is 9.3%, and 47,000 Nova Scotians are ready, willing, and actively looking for work that isn’t there?
The recent recession hit some parts of Canada harder than others, and Nova Scotia is still feeling the effects. The Nova Scotia economy has picked up
. . . → Read More: The Progressive Economics Forum: Back to Balance in Nova Scotia
What not to say in an interview if you’re on EI, and other nightmares
The latest detail to emerge about the recent changes to EI is from the Digest of Benefit Entitlement Principles. The Digest is a guide to enforcing Employment Insurance, with definitions of key terms, and elaborates on expectations of EI claimants and penalties for errors.
In Chapter 9, Refusal of Employment, Service Canada outlines several actions that are equivalent to refusing employment.
Section 9.2.3 states that “a refusal of employment occurs where the claimant advises the employer that they are available for only a limited (Read more…)
In a guest post at the Broadbent Institute, I flesh out some of the impacts of EI changes with three (fairly typical) hypothetical stories of unemployed Canadians. There are certainly more extreme consequences felt by some already. At least these folks have access to the Board of Referees. Many fear that access to natural justice will be threatened as we transition from the old appeals system to the new downsized Social Security Tribunal starting April 1st.
Punitive changes to the definitions of suitable work, combined with cuts to Service Canada front-line workers, and a down-sized appeals process make for a
. . . → Read More: The Progressive Economics Forum: Getting the Facts Straight on EI Changes
The glaring contrast between employment numbers, and the unemployment rate, was highlighted by today’s labour force numbers from Statistics Canada (capably dissected elsewhere on this blog by Angella MacEwan).
Paid employment (ie. employees) declined by 46,000. Total employment (including self-employment) fell by 22,000. Yet the unemployment rate fell to 7% — its lowest level since late 2008.
Fewer people were working, yet the unemployment rate declined. What gives?
Especially during times of economic weakness, the official unemployment rate is a bad measure of the state of the overall labour market, for familiar reasons: to qualify as (Read more…)
After five months of job gains, the job market turned dismal in January. Officially, the unemployment rate fell from 7.1% to 7.0%, the lowest it’s been since December 2008. This is despite a loss of 45,800 jobs (not counting self-employment). The explanation is an out flux of discouraged workers from the labour market, which caused the ‘real’ unemployment rate (R8) to jump from 9.4% to 10.7%.
Gains in self-employment masked the job losses, as there was an increase of nearly 24,000 self-employed persons in January, for an official loss of 22,000, nearly all in full-time positions. Ontario suffered
. . . → Read More: The Progressive Economics Forum: Job Market Worsens in January
Several key changes to Employment Insurance came into effect on Sunday. The EI program is about to get Grinch-ier, especially for who happen to have needed it more than once.
Some of the changes made are reasonable, some are technical, and some are misguided. Together, these changes go some way toward redefining what employment insurance is all about, and changing how Canadians think about employment insurance.
The creation of three categories of EI users – frequent, occasional, and long-tenured. The types of jobs, and level of wages that will be considered ‘suitable’ will vary depending on your category, . . . → Read More: The Progressive Economics Forum: Re-defining (Un)Employment Insurance
As we close out 2012, BC finds itself in some precarious economic waters. To recap, a massive housing bubble that built up through the naughties (2000s) finally burst in 2008, feeding a financial crisis, as extremely loose (some would say fraudulent) lending practices pushed housing prices up to spectacular, never-seen-before levels, and created a plague of toxic mortgage-based assets. The inevitable collapse of that bubble triggered our current context of depression economics; that is, a major drop in the value of housing assets on the balance sheets of many millions, making people poorer and undercutting their other consumption (in the
. . . → Read More: The Progressive Economics Forum: State of the BC Economy
Every time this government crows about its job creation record, I cringe. They have moved the finish line and declared victory. No reason to worry about the unemployed here, folks. Let’s move on to more public service cuts, and/or tax cuts. Never mind that unemployment has been in and around 7.4% since the spring of [...] . . . → Read More: The Progressive Economics Forum: The Harper Government’s New Math
The Harper government likes to remind Canadians that we’ve done better than most developed nations in bouncing back from the global economic crisis. But digging into the data shows why many people might be having trouble cheering this news: wages have not kept pace with inflation, and new hires are making 40 per cent less than the average worker.
Tiff Macklem, senior deputy governor of the Bank of Canada, recently brought home the official storyline: The level of employment is now higher than it was before the crisis; jobs are mostly being created in the private sector, most are full-time
. . . → Read More: The Progressive Economics Forum: Welcome to the Wageless Recovery
Here is a piece I wrote for today’s Globe Economy Lab re the Department of Finance report on the costs of an aging society.
The key point is that the mainstream doom and gloom projections of the costs of falling labour force growth ignore the positive impacts which can be expected as and when we get to a situation of tight labour markets. If we actually get to a low unemployment rate because of fewer labour force new entrants, participation rates of older age groups will rise and we can confidently expect labour productivity growth to increase. Sure, there will
. . . → Read More: The Progressive Economics Forum: The Limits of Demography
This September, like every year, a new group of high school graduates headed to college or university to pursue higher education. But today’s generation of students is in for a very different experience from the ones their parents had.
On campuses across the country shiny new buildings are popping up, bearing corporate logos or the names of local philanthropists. But most of these are reserved for graduate schools of business, law or medicine, so today’s undergraduate arts and science students can expect to find their classes in the older buildings, often in varying states of disrepair. There, students will be
. . . → Read More: The Progressive Economics Forum: Time to Rethink The Way We Fund Higher Education
At times, the Fraser Institute produces such helpful material.
I hope they make their well-heeled funders, such as the multi billionaire Koch brothers, proud. However, I’m sure the Kochs are more concerned missteps by their progeny Mitt and Ryan are derailing their chance to buy the US presidency.
So back to the Fraser Institute and to three of their recent reports.
1. As Canada (and other countries) have increased their level of “market freedom” as measured by the Fraser Institute’s flagship Economic Freedom of the World report (and other measures of market freedom and deregulation), our productivity growth
. . . → Read More: The Progressive Economics Forum: Three Cheers for the Fraser Institute!
Miles Corak has a great post up about Paul Krugman’s “favourite gauge” of unemployment, the employment rate. Looking at the ratio of employed to population for working age men, he shows that the employment recovery in Canada appears to have stalled, moving very little since January 2011.
The graph below shows youth unemployment (right axis) and employment (left axis) from January 2007. In August 2012, youth unemployment was 14.8% – an improvement of 1.6 percentage points since the peak of the recession. The youth employment rate in August, however, was actually at its lowest point since the recession
The Globe and Mail on Saturday devoted two pages of its Focus section to a discussion of Hanna Rosin’s book, The End of Men.
There are a few interesting anecdotes on changing sex roles, but there are no facts cited to substantiate the argument that North America is seeing the rise of a matriarchy as women have displaced men in powerful and well-paid jobs and as men take on more work in the household.
Sure, things have changed a lot since the 1970s, but not so much recently if you look at the Canadian stats.
Women earn more than men
. . . → Read More: The Progressive Economics Forum: The End of Men?
Over the past year, the Canadian labour force has grown by 185,000 people, but we have only added 176,600 jobs. The population grew by 1.2%, but employment only grew by 1%. The unemployment rate has not budged, at 7.3%, a far cry from the pre-recession rate of 6%.
For youth, the picture is worse, with 72,000 fewer youth employed this August compared to last year.
With lackluster private sector jobs growth, and cuts in the public sector at both federal and provincial levels, the situation seems unlikely to improve any time soon.
Corporate tax cuts have not had
. . . → Read More: The Progressive Economics Forum: Tax Cuts, Dead Money, and Lackluster Jobs Growth
Further to my earlier post on the “own goal” scored by the Fraser Institute report on North American labour markets, the Table below shows the rankings of the Canadian provinces – out of 60 states and provinces – for (1) labour market performance, 2007-11 and (2) the unionization rate. (I have reversed the Fraser ranking for the latter indicator so that a rank of 1 rather than 60 is given to the jurisdiction with the highest unionization rate.)
The provinces all score relatively well in terms of labour market performance, with 4 in the top 10, and only Nova
. . . → Read More: The Progressive Economics Forum: Unionization and Labour Market Performance
A release by the Fraser Institute – Measuring Labour Markets in Canada and the United States, 2012 Edition – registers as a spectacular own goal.
The Fraser Institute believes – and argues in this study – that strong unions, high minimum wages and high levels of public sector employment undermine labour market performance measured in terms of job growth and productivity.
Yet, if you read this report, you will find – Figure 1 – that the 10 Canadian provinces ranked in the top 21 out of a total of 60 states and provinces in terms of an overall index of
. . . → Read More: The Progressive Economics Forum: Labour Market Regulation and Labour Market Performance
Yesterday, Mike Moffatt took to The Globe and Mail’s “Economy Lab” in response to my suggestion that the Bank of Canada should moderate the exchange rate. (Perhaps his motive for encouraging me to seek the Saskatchewan NDP leadership was to get me as far as possible from the levers of monetary policy.)
My rebuttal of Mike’s rebuttal appears in today’s Economy Lab:
Mike Moffatt’s friendly rebuttal of my comments on last week’s inflation report advances an important debate about Canadian monetary policy and the exchange rate. In fact, I believe that we agree on several key aspects of
. . . → Read More: The Progressive Economics Forum: Broadening the Bank of Canada’s Mandate