More Than 1.4 Million Unemployed
Statistics Canada reported today that unemployment exceeds 1.4 million for the first time in eight months. Decemberâ€™s unemployment figure was the highest recorded since April. And these official figures significantly understate the problem of underemployment by not counting people who have given up looking for work and part-timers who want full-time jobs.
Indeed, part-time work accounted for all of Decemberâ€™s supposed employment gains: 43,100 additional part-time jobs masked the loss of 25,500 full-time jobs. Meanwhile, 31,100 more Canadians reported self-employment as 13,600 fewer were actually paid by an employer. With fewer unemployed workers receiving Employment Insurance benefits, one suspects that much of this self-employment is involuntary.
The average hourly wage rose by 2.2% over the past year, not enough to keep pace with 2.9% inflation. (We do not yet have the Consumer Price Index for December, but the inflation rate was 2.9% in October and November.)
Canadaâ€™s weakening labour market argues for our central bank to keep interest rates low or reduce them. Federal and provincial governments should prioritize employment-supporting public investment over austerity to quickly balance budgets. Reducing the deficit will not create jobs, but creating jobs would help reduce the deficit.
UPDATE (January 6): Interviewed on the Business News Network
UPDATE (January 7): Interviewed on The National (at 1:50) and The Lang & Oâ€™Leary Exchange (at 15:10)