The Other Shoe Drops
Generally in recent months and particularly in November, there were pronounced job losses in the province of Ontario and the manufacturing sector. In December, the Ontario and manufacturing numbers did not change much. But job losses spread to other provinces and the construction sector. In effect, the only remaining bright spots in Canadaâ€™s labour market have been extinguished.
Even adjusting for seasonality, construction employment fell by 44,000 in December, accounting for all of the national decline in employment. Total employment dropped by 9,000 in Quebec, 16,000 in Alberta, and 8,000 in British Columbia.
The sharp decline in construction employment reinforces the need for more public infrastructure investment. Also, the federal government should remove its requirement that projects receiving federal funds be organized as public-private partnerships. Private capital is now in extremely short supply and requiring that it be obtained will unduly delay needed infrastructure spending.
Full-time vs. Part-time
The loss of full-time employment was especially severe in December. Strikingly, Quebec lost 49,000 full-time jobs and Alberta lost 20,000 full-time jobs.
The country as a whole lost 71,000 full-time jobs, almost twice as many as last month. But there were 36,000 more part-time jobs, reducing the overall employment decline to 34,000.
The number of Canadians officially recognized as being unemployed rose by 47,000 in December. The total now exceeds 1.2 million for the first time since May 2005.
The national unemployment rate jumped to 6.6%, its highest level since January 2006. In terms of unemployment, three years of improvement have been erased.
These figures again reinforce the need for a better Employment Insurance system. It is increasingly doubtful that the new Employment Insurance financing regime instituted in Budget 2008 will survive the labour market downturn.