“Employment is up by one million since the recession ended.”
A statement like this may indeed be a big talking point when Statistics Canada releases the results of its monthly Labour Force Survey on Friday.
While a million more people at work sounds like a lot, the Canadian population has also increased by roughly the same amount with the result that the fraction of Canadians working has been pretty well unchanged for the last five years, and has yet to return to rates before the recession.
A million is a big number, but it’s not enough to signal a complete recovery from the recession.
Statistics Canada reported that employment rose by 51,000 in February.
These numbers seem to gyrate tremendously from month to month in a way that has little to do with economic fundamentals: jumping by 40,000 in December, falling by 22,000 in January, and now rising significantly.
Mr. Carney can’t push on a string. And he knows it.
His now famous comment labelling the stockpiles of retained earnings held by Canadian firms as “dead money”, while perhaps being the most memorable quote of 2012, must also have been made out of a certain frustration that even this superstar central banker faces limits in his powers to push, encourage, and otherwise jumpstart business investment.
The Governor of the Bank of Canada knows that the flip side of dead money is insecurity in the jobs market.
There has been virtually no growth in employment among young Canadians over the course of the last three years. Employment plummeted in late 2008 for those younger than 25, and has gone nowhere but sideways since . This is in sharp contrast for older groups: their employment levels recapturing all the recessionary losses by 2010.
Read the employment levels for 15 to 24 year olds in thousands off of the left scale, and that for those 25 and older off of the right scale. Between September 2008 and August 2009 employment among the young fell by a quarter of a million, and has been virtually stagnant since.
The state of the jobs market is best assessed by a number that is not given enough attention by Statistics Canada, and the many media reports based upon its monthly press release.
The headline attention is all soaked up by the unemployment rate and the level of employment, when it really should be something Paul Krugman—the Princeton University economist and New York Times columnist—calls his “favorite gauge” of the employment situation.
This morning Statistics Canada reported that the unemployment rate increased to 7.6%, confirming a rising trend since July of last year and still significantly above the low of about 6% just before the recession took hold in the autumn of 2008.
This statistic is probably the closest a number can come to having a human face; it relates directly to the hardship Canadians experience in providing for their families, saving for their retirement, and just meeting their day-to-day needs.
But in the end we can’t clearly see the faces of real people behind this number, which at best is an incomplete picture of waste and hardship.