Unemployment Hits Twelve-Year High
The number of officially unemployed Canadians rose by 106,000 in February, pushing the total over 1.4 million. In other words, the ranks of Canadaâ€™s unemployed swelled to their highest level since February 1997.
North American Race to the Bottom
A common theme in Canadian economic commentary is that things are worse in the US. While American employment has been contracting for longer than Canadian employment, Canada now appears to be losing jobs at a faster pace than the US.
There are about nine times as many employed workers in the US as in Canada. Februaryâ€™s loss of 83,000 Canadian jobs is proportionate to a monthly loss of almost 750,000 American jobs. Januaryâ€™s loss of 129,000 Canadian jobs is equivalent to more than 1.1 million American jobs.
Manufacturing: A Dead-Cat Bounce?
Despite the overall loss of employment, manufacturing regained 25,000 jobs in February. This statistical rebound restores only one in four of the manufacturing jobs lost in January. It does not take account of major manufacturing layoffs that have been announced but not yet executed.
In total, Canadian manufacturing employment dropped by 456,000 between November 2002 and February 2009. The only ray of hope for manufacturing is that the Canadian dollarâ€™s decline provides a cost advantage for locating facilities in Canada.
Carnage Spreads to Other High-Wage Industries
The most recent available Survey of Employment, Payrolls and Hours (December 2008) indicates an average hourly wage of $20.34 for all hourly-paid employees in Canada.
Construction, which paid an average wage of $25.74, eliminated 43,000 jobs in February. This continuing downward trend heightens the urgency of public infrastructure spending.
The even larger contraction of service-sector employment was also concentrated in relatively high-wage industries. Professional, scientific and technical services, which paid $21.98 per hour, lost 31,000 jobs. Healthcare and social assistance, which paid $25.54 per hour, shrank by 15,000. Educational services, which pay more than $21 per hour (although complete wage data is not available), also shrank by 15,000.
Reflecting these declines in health, welfare and education, total public-sector employment contracted significantly in February.