Wordsmithing 80,000 Jobs
Last weekâ€™s federal throne speech stated, â€œThe Government will soon complete negotiations on a comprehensive economic and trade agreement with the European Union [CETA]. This agreement has the potential to create 80,000 new Canadian jobs.â€
There has since been a subtle but important shift in the governmentâ€™s wording around that figure, as I point out in the following letterÂ on page A10 of todayâ€™s Ottawa Citizen and on The Montreal Gazette website:
L. Ian MacDonald writes, â€œA study indicates CETA will add $12 billion and 80,000 jobs to the Canadian economy.â€Â In fact, the study in question assumed full employment to estimate $12 billion of additional output and therefore did not project any additional jobs.
Government officials then translated $12 billion into employment for communications purposes. Conservative wordsmiths already appear to be backing away from this indefensible claim.
The media backgrounder accompanying last weekâ€™s announcement of the Canada-EU deal stated, â€œAn agreement could boost Canadaâ€™s income by $12 billion annually and bilateral trade by 20 per cent. Thatâ€™s equivalent to creating almost 80,000 new jobs.â€ Subsequent federal documents on CETA have used similar wordings.
The government is not claiming that CETA will actually create jobs. It is claiming that CETA will boost output by a dollar value deemed â€œequivalentâ€ to 80,000 jobs. Unfortunately, many journalists and columnists have missed this distinction.
So far in 2013, Canada has imported $36 billion from Europe but exported only $22 billion to Europe. If CETA increased both amounts by 20 per cent, $7 billion of additional imports would displace more Canadian production and jobs than $4 billion of additional exports could add.
CETA threatens to deepen Canadaâ€™s bilateral trade deficit with Europe. Unless we simply assume full employment, a larger trade deficit would detract from Canadian output and employment.
UPDATE (October 26): An abridged version of my letter is on page B6 of todayâ€™s Montreal Gazette.