35,000 Manufacturing Jobs Gone in One Month

This morning, Statistics Canada released its Labour Force Survey figures for February. My analysis, which was included in the CLC’s press release, follows:

Manufacturing Crisis Deepens

Canada lost 35,000 manufacturing jobs between January and February. This staggering one-month decline pushes the cumulative loss to 250,000 since Canadian manufacturing peaked in November 2002.

Most of February’s devastating decline took place in Quebec, which lost 33,000 manufacturing jobs. In previous months, gains in western Canada offset losses in central Canada. However, Alberta lost a further 6,000 manufacturing jobs in February. Nova Scotia and British Columbia each lost fewer than 1,000 manufacturing jobs, while New Brunswick, Ontario and Manitoba each gained fewer than 1,000 jobs.

Self-Employment

An increase in service-sector employment masked the ongoing manufacturing crisis. However, two-thirds of the new jobs created in February were self-employed position as opposed to paid positions. While the number of self-employed Canadians grew by more than 9,000, the number of employees rose by fewer than 5,000 nationwide.

Wages

Nationally, average hourly wages rose by 2.8% between February 2006 and February 2007. Outside of western Canada, this increase was only 1.8%, which barely exceeds inflation. Newfoundland and Labrador’s average wage declined in absolute terms, even before taking account of inflation.

Unemployment: The Full Picture

In recent years, bank economists have emphasized the seemingly large number of jobs created and the unemployment rate’s decline to a 30-year low. However, these national statistics mask the ongoing manufacturing crisis in central Canada. The February issue of Statistics Canada’s Canadian Economic Observer notes that, since 2000:

– Unemployment rates increased in Canada’s two largest cities: Toronto and Montreal;

– Ontario’s overall unemployment rate increased;

– Windsor’s unemployment rate jumped dramatically from 5% to 9%; and

– The unemployment rates of Oshawa, Hamilton, St. Catharines-Niagara, London, and Thunder Bay rose less dramatically.

The national unemployment rate of about 6% emphasized by the Labour Force Survey excludes discouraged and underemployed workers. Calculations including these workers reveal a national rate of about 9%.

Inequality

While national unemployment may have reached a 30-year low, the gap between rich and poor has reached a 30-year high. A study released by the Canadian Centre for Policy Alternatives this month reveals that:

– In 2004, the richest 10% of Canadian families received 82 times more income than the poorest 10% (this ratio is three times larger than in 1976);

– The richest 10% of families are earning significantly higher incomes than in 1996 without working more hours; and

– The remaining 90% of families are working an average of 200 more hours per year than in 1996 without earning appreciably more income.

One comment

  • As you may already know, the US-based Society of Manufacturing Engineers has purchased an exhibition company that puts on manufacturing shows in Canada. Here is the link to the SME news item:
    http://www.sme.org/cgi-bin/get-press.pl?&&20060049&PR&&SME&&id=HOMEPAGE

    I am a former SME employee. I don’t keep track of what SME does, but on one occasion when my home page wouldn’t open, I tried SME’s website to see if it was my computer that was going astray, and I came across the announcement from SME’s Executive Director. Here’s the part that is the height of arrogance:

    “With this acquisition, SME is undertaking a major investment to support Canadian manufacturing companies and their employees. SME is excited and ready to take on a more active and supportive role within the Canadian manufacturing community, and to assist the many fine organizations whose mission it is to enhance the competitiveness of Canadian manufacturing companies and their people,” said Mark Tomlinson executive director and general manager of SME.”

    I was there during the two-year period when SME went from 300 employees to 150, and at the end of the decline from 80-something thousand members in the 1970s to 20-something thousand in the 1990s and 2000s. SME couldn’t support or enhance itself!

    Given the loss of 2.5 to 3 million US manufacturing jobs, SME couldn’t support US manufacturing companies, either! It expects to support Canadian? Plus, I expect there will be some resentment toward an American association sticking its nose into another country’s business.

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