March 12, 2010

Carrick: Canada’s net job loss of 250,000 versus U.S. decline of 8.4 million

For the fifth time in the past seven months, total employment in Canada increased, according to February’s labour market report. The latest month-over-month gain was 21,000 net new jobs.

Moreover, the latest increase in employment was in the better-quality and higher-paying full-time category (+60,000), whereas part-time work declined (-39,000).

However, a caveat does go along with the full-time employment gain. The public sector recorded a large increase in employment (+45,000 jobs) while work in the private sector fell (-25,000). It is the private sector that one looks to for proof that the recovery is self-sustaining and on a good roll.

Having raised the foregoing minor caution, it must be pointed out that the employment situation in Canada is relatively positive.

By way of comparison, the job loss picture in the U.S. may have stabilized at a very low number, but no significant gains have been made as yet. The U.S. lost 8.4 million jobs in the recession and remains stuck at that level.

In Canada, job losses occurred between October 2008 and July 2009. The total decline was 400,000. Since last summer, 150,000 jobs have re-appeared. Therefore, Canada currently stands with a job loss figure of only 250,000 versus the previous peak.

One of the keys to Canada’s success on the jobs front has been virtually no decline in service sector jobs. Many thanks go out to the financial services sector in this country for that fortunate state of affairs. Canada’s more conservative banking community survived the credit collapse better than almost anywhere else in the developed world.

-Alex Carrick, CanaData chief economist

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