Canada’s unemployment rate plunged to 6.8 per cent in September, its lowest level in nearly six years, Statistics Canada says.
Ontario enjoyed the biggest gain, adding 24,700 new jobs, pushing the province’s unemployment rate down to 7.1 per cent from 7.4 per cent in August, the federal agency said Friday.
The labour market data delivered some much-needed positive news at the end of a week that saw turmoil in financial markets amid fresh worries about slowing global economic growth. Given Canada’s dependence on exports, however, the pleasant surprise could be short-lived, economists said.
Ontario’s economic development minister Brad Duguid also hailed the monthly employment numbers and noted Ontario has now created 514,000 net new jobs since the 2009 global recession.
The labour market report beat economists’ consensus forecast for 20,000 new jobs and an unchanged jobless rate in September, according to a survey by Thomson Reuters. While the data was encouraging, economists said they remain wary of the highly volatile monthly data. September’s outsize gain follows an 11,000 net job loss in August, after a surprising 41,700 rise in July.
September’s employment growth “suggests that the economy might finally be catching fire. One month of data, however, doesn’t make a trend,” Capital Markets Canadian economist David Madani wrote in a report to clients.
Over the longer term, the numbers are headed in the right direction, RBC assistant chief economist Paul Ferley wrote in a note to clients. The labour market report is in line with expectations Canada’s economy will grow 3.1 per cent in the third quarter, chiefly on the strength of rising exports to the U.S, Ferley wrote.RBC predicts the Bank of Canada could begin raising its trend-setting interest rate by next spring, the second quarter of 2015.
In September, more Canadians found work in food services and accommodation, health care and social assistance, construction, natural resources, finance, insurance, real estate and leasing, Statistics Canada said.
Fewer jobs were created in educational services, possibly due to the impact of the teachers’ strike in British Columbia as school boards likely delayed contract hiring, economists said.
Younger Canadians made gains, as 43,000 new jobs went to people age 15 to 24 years. However, the youth unemployment rate increased by 0.1 percentage points to 13.5 per cent as more young people looked for work, Statistics Canada said.
Ontario’s unemployment rate is moving in the right direction, hitting a near six-year low. In other encouraging economic news, the Bank of Canada’s quarterly business survey and senior loans officer survey, both released Friday, suggest Canadian companies are becoming increasingly optimistic.
September’s jobless rate (previous month in brackets)
With files from The Canadian Press
Newfoundland 12.7 (13.5)
Prince Edward Island 9.5 (10.0)
Nova Scotia 8.6 (8.8)
New Brunswick 9.6 (8.7)
Quebec 7.6 (7.7)
Ontario 7.1 (7.4)
Manitoba 5.3 (5.5)
Saskatchewan 3.5 (4.2)
Alberta 4.4 (4.9)
British Columbia 6.1 (6.1)
St. John’s, N.L. 6.5 (6.4)
Ottawa 6.8 (6.7)
Kingston 7.8 (7.1)
Peterborough .3 (8.0)
Oshawa 7.7 (7.7)
Toronto 8.2 (8.3)
Hamilton 6.0 (6.3)
St. Catherine’s-Niagara 7.3 (7.9)
Kitchener-Cambridge-Waterloo 6.7 (6.4)
Brantford 6.7 (6.2)
Guelph 6.3 (7.0)
London 7.4 (7.5)
Windsor 8.7 (9.0)
Barrie 5.8 (6.2)
Source: The Star
Canada’s jobs numbers have followed a perfect pattern this year, with gains one month followed by losses the next. September was no different. The country added a better-than-expected 74,100 jobs last month and most of the gains were in full-time positions as well as in the private sector.
To put things in a longer-term perspective, employment has grown by a still-muted average of 13,000 jobs per month in the past year. But last month’s increase was an improvement in the jobs picture. Below are five points that show how that picture has evolved in the past year:
1. Jobless rate hits lowest level since 2008
Robust job gains drove the country’s unemployment rate to 6.8 per cent from 7 per cent in August – its lowest level since December, 2008, according to Statistics Canada. The country’s jobless rate has been little changed over the past year, hovering between 6.9 and 7.2 per cent, punctuated by both modest job creation and more people dropping out of the labour market. Last month, the participation rate stayed at 66 per cent, the lowest since 2001.
2. Private sector sees wild swings
The private sector has been particularly volatile of late, with a record drop in August which was erased in September. Private-sector employers added 123,600 jobs last month while the public sector created 6,000 positions and self-employment fell by 55,600. Over the past year, public-sector hiring has posted the fastest expansion, growing 2.5 per cent, while the private sector has expanded 0.5 per cent. Among sectors, public administration along with accommodation and food services has seen the fastest percentage gains, while agriculture has declined the most.
3. More older workers working
September’s job gains came mostly among youth and women between the ages of 25 and 54. But the longer-term trend has been steep employment gains among workers over the age of 55 as Canada’s population ages, while younger people in the jobs market have seen little improvement. The jobless rate for workers aged 55-plus is 5.7 per cent, while it is 13.5 per cent for workers between the ages of 15 and 24.
4. Still-hefty pace of part-time job growth
In September, full-time employment rose by 69,300 while part time grew by 4,800 positions. In the past year, however, part-time employment growth has outpaced that of full time, rising 2.3 per cent compared with 0.5 per cent. Many people – especially those older workers – are moving into part-time by choice, rather than necessity.
5. Red-hot Saskatchewan
Resource-rich Saskatchewan’s jobless rate fell to 3.5 per cent last month, remaining the lowest in Canada, while the province’s pace of employment growth, at 3.3 per cent, is the fastest.
Source: The Globe And Mail
The latest employment figures from Statistics Canada show a decline of by 112,000 jobs in the private sector in August, resulting in an overall drop in employment of 11,000.
Only last month the agency botched the July jobs report, erroneously claiming the economy added just 200 new jobs, when it fact the figure was 42,000. Scotiabank economist Derek Holt was quick to warn the report “looks very fishy to me.”
We’ll know soon enough if another mistake has been made, but even if the employment report for August didn’t fit with what economists were expecting, it’s hardly out of line with what the Canadian economy has experienced in recent months. There have not been two consecutive months of net new job growth since October 2013 and these new jobs figures are just part of a slowing trend that’s been underway since January 2013.
On an annual basis, job growth is probing depths not seen outside of a recession since the federal government took its deficit-fighting axe to the public service in the mid-1990s, or since the 2001 U.S. recession and 9/11 brought economic activity nearly to a halt.
A few other highlights from August:
- The unemployment rate stayed at seven per cent.
- Since September 2013, full-time employment has grown just 0.03 per cent, the equivalent of 4,200 net new positions.
- Despite the decline in the number of jobs, wages posted a 2.5 per cent gain from the year before. So it’s not all bad news.
Attorney Colin Singer Commentary:
The economy continues to show evidence of inconsistency in job creation. Despite the stubbornly high country wide unemployment rate, shortages continue to amplify in certain industries such as skilled trades in Western Canada.
Most Canadians by now are aware of the ‘erroneous’ report released by Statistics Canada according to which the economy had created only 200 jobs in the month of July. This week they have come out and acknowledged that it was a big mistake. Foreigners and international workers who are intending to work in Canada under a Canada based work visa, work permit or a related immigration project should be especially comforted by this development.
The reports released by Statistics Canada have data on everything from beer consumption in Alberta to mushroom farming in Ontario. But it is the monthly numbers on employment that seem to have the most crucial impact on the economy. These numbers are widely used by both the private sector and the government.
The international currency traders ended up pushing the Canadian dollar down by half a cent based on the July report and had to push it back up again after hearing of the error. Similarly, Ottawa has not been able to process any employment insurance claims and says they will do so only after they receive the revised numbers, since the eligibility for these claims depends on the local unemployment rate.
Considering the importance of this data to Canada, one wonders how such a huge error could be made.
According to Philip Cross, former Statistics Canada chief economic analyst, the reason is “summer vacation”. “When mistakes happen, they tend to happen in summer,” says Cross. “There’s less eyeballs and fingers pointing.”
Summer vacations also leads to fewer samples. In summer it is difficult to contact Canadians who are interviewed for the jobs survey as many of them are also away on holiday. “It corrupts your samples. You phone somebody and they don’t answer because they’re on holiday. So what do you do? You just have fewer samples,” says Cross.
However it’s not just the summer holidays that cause statistical imbalances in employment data. July and August are the months which see major changes in the jobs front. During these months, many high school and university students take up short-term summer jobs, and some switch from part-time jobs to full-time employment. Also several schools lay off their staff in the summer and rehire them in September in order to avoid dealing with the bureaucracy of vacation pay. For instance, in 2010, Statistics Canada reported that 68,000 teachers were laid off in July and retired in August. The problem is different for construction workers – their numbers go up in summer and drop in the winter.
Statistics Canada uses a process of ‘seasonal adjustment’ to update its data to compensate for these type of predictable changes. However if one looks at the unadjusted data from previous years, it shows how drastically things can change in the summer.
To understand how Statistics Canada made this big mistake, it is important to see how the agency collects its highly influential jobs data. To collect data for the monthly labour force survey, the surveyors have to go and knock on the door of 56,000 Canadian homes, which are chosen from the latest census data. They then quiz their inhabitants about their working lives.
Usually starting after the 15th of every month, the interviews take place during the same week every month. The answers are then analyzed and compared to baseline data on population and job market and then transformed into “representative” samples of the entire country. The answers are “weighted” to ensure they accurately represent their age, gender, occupation and where they live.
It is at this point that there is a big room for error. So that 56,000 people can accurately reflect the working lives of more than 34 million Canadians, the surveyors have to compare them against a baseline set of data of the entire Canadian population. The census provides these numbers – local population counts, numbers of workers in different age groups, number of people working in various industries etc. Whereas the labour force survey is done every month, the census is updated only once in five years. As a result Statistics Canada has to estimate the changes happening to the population and the job market in the intervening years.
And when the new census comes out, it takes time for Statistics Canada to update all of its statistical models and past data. It can take several years from the time the most recent census is released to the time they can be input back into the employment data. And the further we get from the previous census, the more guess work has to be done by Statistics Canada. The monthly job surveys of 2014 are using data based off the 2006 census. This implies that Statistics Canada is comparing the answers of 56,000 Canadians in July to a situation in Canada eight years ago and then taking a guess on how things have changed. This process will obviously leave a significant room for error, especially in those parts of Canada where there have been major population changes or industrial upheavals.
According to Statistics Canada, here is how the switch from 2001 to 2006 census affected its employment numbers in the provinces at the time:
In 2010, employment levels were revised downward by 1% or more for New Brunswick (-2.3%); British Columbia (-2.1%); Newfoundland and Labrador (-1.5%) and Prince Edward Island (-1.0%) whereas estimates for Alberta were revised upward, by 1.0%.
Eventually, Statistics Canada does go back to revise all of its past data to adjust it to reflect actual population changes and thus make it more accurate. However this process takes time. The next such update was due in January 2015, when all Canadian jobs numbers were to be revised so that they would be based off of the 2011 census.
There is a chance that it was this update that caused last month’s jobs errors. According to Cross, such errors are few and far between and that Statistics Canada’s data has actually been getting more accurate over the years. He also refers to former chief statistician Munir Sheikh as someone who really improved the efficacy of the agency’s data verification process, including tying the error rate to job performance reviews. Cross says that those processes have continued to improve under the new chief statistician Wayne Smith.
Statistics Canada’s most prized divisions are the ones that produce the three most important numbers in the country: the GDP (economic growth), the Consumer Price Index (inflation) and the Labour Force Survey. According to Cross, these divisions were spared from budget cuts and the CPI is actually on a hiring spree. Even the labour force survey was not affected by the Conservative government’s decision to swap the mandatory long-form census for a voluntary survey, since it’s based off of the short-form census, which is still mandatory.
The error in July numbers however show much our understanding of the job market still depends on ‘guessing’ and is therefore subject to plenty of human error and assumption. This is true of most of the data collected by Statistics Canada. “There isn’t one major data point that over time I haven’t seen a mistake,” Cross says. “It’s a huge place. It processes a lot of data. It’s full of human beings and human beings make mistakes.”
Attorney Colin Singer Commentary:
International workers who may be interested to work in Canada under a work visa, work permit or a related immigration program are invited to contact us and receive a free consultation of their qualifications.
Canada’s oil-producing provinces have been ranked among the world’s top economic performers in a newly released think-tank report.
Each year, the Conference Board of Canada ranks 16 of the world’s richest countries in terms of economic performance, based on factors such as growth and employment rates. This year, however, the Canadian think-tank not only analyzed the country as a whole, but also broke down and compared the economies of the ten different provinces.
The findings were somewhat surprising, due to the disparity between those provinces whose economies are oil-based and those that are not. While overall Canada ranked fifth among the world’s richest countries, Alberta, Saskatchewan and Newfoundland were ranked the top three jurisdictions in the world, when graded separately.
The top-rated economy was Alberta, which outperformed the top-rated country Norway by about $10,000 per capita on income. Ontario, British Columbia and Prince Edward Island all ranked in the middle of the group with countries like Germany and the United Kingdom. At the bottom of the pack were France, Belgium and the Canadian provinces of Nova Scotia and New Brunswick.
“What this tells us is we have provinces outperforming the rest of the world, and we have provinces that are struggling along with the laggards in the Eurozone,” said Conference Board project director Brenda Lafleur.
The report predicts continued strength for the three oil-producing countries, and recommends that the lagging provinces work on productivity initiatives to boost their economic performances.
Canada’s overall fifth place ranking is an improvement after coming in sixth last year.
Source: Vancouver Sun
How the Temporary Foreign Worker Program Moved from Being a Nimble Program to One that Requires a Complete Revamp
According to popular perception, the Temporary Foreign Worker Program, currently under intense Parliamentary scrutiny following a series of program abuse allegations by the Royal Bank of Canada, three McDonald’s franchises in Victoria, British Columbia and a pizza restaurant in Weyburn, Saskatchewan, was a program that had merit on paper initially, before it spiralled out of control.
Currently, the Temporary Foreign Worker Program has become a major issue affecting not only unemployed Canadians but also those individuals coming to Canada from abroad, for short-term jobs.
Canada launched the program in 1973, aiming to bringing in highly specialised workers like academics and engineers for meeting skills gaps in the country. In 2002, the Liberals under Jean Chretian, included low-skilled workers under the ambit of the program.
Successive Liberal and Conservative governments continued to tweak the program further so that it expedited the process of bringing in foreign workers into several sectors of the industry, including food and construction, once pilot projects commenced in Alberta and British Columbia. This resulted in the accelerated entry of temporary foreign workers into Canada – moving from 101,000 in 2002 to 338,000 in 2012, with low-skill workers forming the fastest growing denomination of workers.
Under the current program, Canadians lose out on jobs as do several foreign workers. Locals also miss out on employment opportunities and employers keep wages at artificially low levels. In addition, the government also does not have the bandwidth to keep monitoring a program of this size for any possible program abuses.
Researches also back the impact of the Temporary Foreign Worker Program. A CD Howe Institute reported that a pilot project that accelerated the approval process for companies to hire low-skill temporary foreign workers, raised unemployment levels.
The Alberta Federation of Labour revealed recently that some companies were paying temporary foreign workers up to $5 less than the prevailing local market wage for the job, with the tacit approval of the federal government. This also means that the program can reduce wages for foreign workers as well.
According to Jason Foster, the coordinator for Athabasca University’s industrial relations program, “The Temporary Foreign Worker Program moved from being a small, nimble program to a large-scale one that the Government could not manage successfully.” While Employment Minister Jason Kenney promised to implement new reforms for the program, experts believe that only a complete revamp of the program could help salvage the situation.
Source: CBC News
Experienced Canadian helicopter pilots have expressed their concerns about employers hiring cheap temporary foreign workers instead of them, by denying the experienced pilots these jobs. The pilots say that if left unchecked, this trend of hiring cheap temporary foreign workers could spell the death knell for the industry.
Bill Wadsworth is a helicopter pilot in Mayne Island, British Columbia, with about 25 years of experience. He said that he had recently applied for several jobs at various companies in the province. While he was not selected or shortlisted for any of the jobs he applied for, he did come to know that several companies to which he had applied had subsequently sought cheap temporary foreign workers. Ironically, each of the companies to which Mr. Wadsworth applied had mentioned that they had no openings at the time.
In a subsequent interview, Mr. Wadsworth said that he often came across job postings for pilots that offered hourly rates well below the prevailing industry standards. While this would effectively drive down wages in the near future, according to him, this practice of hiring cheap temporary foreign workers instead of experienced Canadian helicopter pilots would eventually lead to the demise of the industry.
Mr. Wadsworth said that this practice showed how Canadian employers were leveraging foreign workers against experienced Canadian pilots. “They’re leveraging the foreign workers against the Canadian pilots, essentially threatening Canadians by saying: ‘We’re paying these guys so little and we’re only going to pay you 10 dollars an hour more. So you either go with the flow here or we’re hiring TFWs and you’re out of work,” he said.
Kirsten Brazier, a helicopter and fixed-wing pilot in Vancouver has encountered similar experiences. She said that employers were increasingly telling Canadian pilots across the country that the Canadian pilots were under-qualified, thereby emphasizing the need to hire cheaper temporary foreign workers. In doing so, these employers were simply exploiting the loopholes in the system and hoodwinking the federal government.
The Canadian Press examined several applications for temporary foreign workers, filed by private helicopter operators from across Canada and found that these hiring companies have expressed their inability to find domestic candidates who possess the required skills.
Ms. Brazier said that the practice of not employing Canadian pilots would damage the industry in the end, as operators would use the program as a justification for disqualifying competent Canadian pilots.
Source: The National Post
A new survey reveals that more than half of Canada’s adult workforce is unwilling to relocate for pursuing employment opportunities, which also throws light on why many Canadian companies have to hire temporary foreign workers because of the shortage of local skills.
The survey, conducted by Ipsos Reid for the Canadian Employee Relocation Council (CERC), checked with more than 2,000 Canadian workers whether they would be willing to move to a job that either operated from elsewhere within their current provinces or from other parts of the country. Experts consider the CERC survey to be accurate to within 2.5 percentage points.
Only 10 percent of the Canadians surveyed expressed their willingness to move, while a third expressed their reservations about the movement, even though they mentioned that with the right levels of persuasion and incentives, they would be willing to relocate for the job.
Reviewing the results of the survey, the head of the Canadian Employee Relocation Council, Stephen Cryne, said that the findings were disturbing. The Council said that the observations from the survey emphasised some of the challenges that businesses, which are looking to attract highly skilled labour, continue to face.
Respondents, who were willing to move to another part of the country for a job, wanted a top incentive of a 20 percent pay hike, in addition to the employer bearing all the expenses related to the relocation.
More than half of the respondents also mentioned that the government could play a vital role in making the relocation more attractive by permitting employers to provide a tax-free housing allowance for up to six months. This would not only help the relocating employees avoid unnecessary accommodation worries that come with a relocation for a new job, it would also enable the employees to settle themselves in the new location.
Half of the respondents also said that the government must permit employers to provide employees with non-taxable, interest-free loans of up to $100,000, so that the relocating employees could purchase a home in the new location.
A 2013 report from Statistics Canada and Haver Analytics shows that the percentage of Canadians moving between provinces has declined steadily over the years since 1977, from 1.5 percent in 1977 to under one percent in 2012.
While the Organization for Economic Co-operation and Development has recommended that Canada reduce barriers to geographical and occupational mobility, Council head Cryne felt that the government needed to promote the benefits of labour mobility in Canada more vocally.
Source: The Canadian Press
Canada must recognize the potential economic advantage that immigrants bring if it wishes to remain globally competitive, according to one of the country’s top economists.
In a recent piece for the Globe and Mail, Royal Bank of Canada chief executive officer Gordon Nixon, calls for more efforts to tap into under-utilized immigrant skills. He points to a recent RBC study which found that if newcomers earned equal wages to their Canadian-born counterparts, personal income in Canada would increase by $31 billion.
Nixon first calls out employers, saying that more needs to be done to promote diversity in the workplace and embrace international experience.
“A work force with global experience is a competitive advantage,” argues Nixon, who is also chair of the Toronto Region Immigrant Employment Council. “International experience is an asset to business. Too often, we hear that newcomers with no Canadian experience would be hard to fit into the Canadian work force. In truth, international experiences relate directly to the modern Canadian context.”
Secondly, states Nixon, governments need to continue the work that they are doing with other levels of government, as well as stakeholders in the community. More funding should go toward skills assessment and training, as well as community support services and cultural activities.
Immigration has helped make Canada the country it is today. We must not forget that part of our heritage if we wish to continue to contribute and compete in the interdependent global marketplace.
“The lesson of our history is clear and points the way to future economic prosperity and success: Canada has relied on diversity and immigration to build a prosperous economy and will continue to do so in the years ahead. We are good at it, but we need to get better to maintain that competitive edge.”
Source: Globe and Mail
The Employment Minister Jason Kenney suspended Canada’s Fast food sector from the Temporary Worker Program in the wake of program abuse allegations by several McDonald’s outlets and a pizza restaurant in Saskatchewan. This also means that any pending applications from the food services sector will remain in limbo.
While there has been widespread criticism from all quarters over the Temporary Foreign Worker Program – based on anecdotal evidence, statistical proof and national perception, the latest incidents of program abuse forced the indefatigable minister to step in and take some remedial action.
Kenney has faced a tough few weeks battling revelations about small businesses, which continually displace Canadian workers with temporary foreign workers willing to work regardless of the hours, holidays or the conditions. Ironically, the Conservatives have championed the cause of these small businesses that continue to flout the rules.
While incidents of program abuse have yielded sufficient anecdotal evidence that have shaped public perception about the Program, studies by academic institutes have queered the pitch further by providing statistical evidence that the Temporary Foreign Worker Program has raised unemployment levels.
The non-partisan CD Howe Institute established that the Program raised unemployment levels in Alberta and British Columbia – two Conservative strongholds. Similarly, Dominique M Gross of Simon Fraser University analysed the period from 2007 to 2010, when the Conservative Government eased the requirements and expedited the process of hiring temporary workers in two provinces because of a reported labour shortage in western Canada.
She found that there was little evidence of shortages in several of the fast-tracked low-skilled occupations. In addition, she also found that the influx of foreign workers contributed to an increase of a cumulative 3.9 percentage points to the unemployment rates. This led her to conclude that placing a cap on the number of temporary foreign workers entering the country annually could help buck the trend.
The Program, which had merits on paper, is clearing without adequate safeguards to prevent employers from abusing it. Thus, even as employers fill jobs with foreign workers, they continue to deny Canadians jobs in their region or even the right to migrate to jobs that they want. Similarly, Canadian employers also find themselves undercut by competitors using temporary foreign workers.
This situation would continue to be the norm unless Kenney can revamp the abused Program and provide proper safeguards to protect the rights of all Canadians – employers and workers.
Source: The Toronto Star