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The Progressive Economics Forum

The Harper Government’s New Math

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 2011, nowhere near the 6% prior to the recession.  Never mind that there were nearly 300,000 more Canadians looking for work in October 2012 than there were in October 2008.

So let’s take a look at some of those claims.

1)    ”We’ve created over 800,000 jobs.”

The number of jobs created depends on when you start counting.   The pre-recession peak was October 2008, and the trough was July 2009.  If you compare our situation to before the recession, there are 390,000 more Canadians employed, but there are also nearly 300,000 more Canadians unemployed.

A good way to gauge if we have created *enough* jobs is to look at the employment rate – the percentage of working age Canadians employed.  In October 2008, 63.5% of Canadians were employed. This number has been at or below 62% since February 2009.

2) “90% of the jobs created have been full-time.”

That’s true (if you measure from July 2009), and usually a reasonable measure of a good job.  But if we look at the new jobs created since October 2008, almost half (49%) were temporary jobs.  Only 13% of all Canadian jobs are temporary,  so this is clearly a disproportionate increase in temporary employment.  Temporary jobs pay less, and are, well, temporary.  Oh, and if you’re hoping to qualify for unemployment insurance, you’re less likely to have banked enough hours by the time your contract runs out.

As you can see in the table below, Quebec, Ontario, and BC all created a higher proportion of temporary work than the national average.

Change between October 2008 and October 2012*

Change in Jobs # Temporary % Temporary
Canada 349,900 172,000 49.2%
Newfoundland and Labrador 10,600 -400 n/a
Prince Edward Island 3,500 0 n/a
Nova Scotia -2,700 -3,400 n/a
New Brunswick -10,800 -4,300 n/a
Quebec 106,000 79,600 75.1%
Ontario 28,900 24,300 84.1%
Manitoba 22,300 2,100 9.4%
Saskatchewan 12,600 400 3.2%
Alberta 97,100 24,600 25.3%
British Columbia 82,500 49,100 59.5%

* The numbers in this table come from Statistics Canada CANSIM table 282-0079, and are not seasonally adjusted.

3)  ”The majority of job creation has been in traditionally high paid sectors”.

Armine covered this here, showing that new hires are now being paid 40% less than the average worker in their sector.  I’d like to add that the average weekly earnings of  temporary workers are only 65% of the average for permanent workers, so the growth in temporary work comes into play here as well.

The point?

If you look at Canadian labour market indicators carefully, as the PBO did recently, you see that there is still slack in the labour market, there is still room for fiscal stimulus.  You see that there is still a need for extended EI benefits, and there is a huge need for public infrastructure investment.  The Harper Government’s New Math aside, there is no room for any more *fiscal consolidation* (in other words, austerity).

 

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Comments

Comment from Andrew Jackson
Time: November 16, 2012, 1:13 pm

Nice piece Angella.

Comment from Janet Mercado
Time: November 17, 2012, 8:23 am

Cheers!!!

Comment from Brandon L
Time: November 21, 2012, 12:53 am

Harper is a bad joke who should have never got majority, NDP love Harper for reasons that have nothing to do with the pain, suffering, sorrow Harper causes, but for the backlash, for the idea something better then him, conservatism especially social conservatism “build more prisons, ramp up military” fiscal conservatism will never die to you’re dismay, I will worry regardless about inflation, government spending because if people work longer for goods or services as prices rise you are in the wrong point of view, & how we get wages to match prices will be of much debate!

Comment from judith cameron
Time: November 21, 2012, 10:33 pm

ANGELLA

This is a wonderful feature and it should/must be
front and center for more Canadians to reference.
Is it being published elsewhere?
It is almost impossible to access intelligent analysis like this about this governments bizarre (and dishonest)
accounting habits.
Many thanks and don’t relent!!

Comment from Errol Sharpe
Time: November 26, 2012, 12:29 pm

This is the kind of information that needs to get out there. Harper is a scammer and must be exposed. If the Liberals and The NDP could now bury their self interest and unite to defeat Harper something good might happen in this country.

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