Five depressing charts about the Canadian economy -

Five depressing charts about the Canadian economy

Not so much better than everyone else, eh?


Yay, Canada. We survived the global recession and created lots of new jobs. Now for the bad news: Those jobs have mostly been low-paying, temporary ones with few benefits. And we haven’t created enough of those bad jobs to get back to where employment levels were before the financial crisis.

Those are some of the highlights from a new report released this week by the UN’s International Institute for Labour Studies sizing up the state of the global job market.

Among the more depressing findings of the annual “World of Work” study: The world still needs to create another 14 million jobs to get back to where we were in 2007. Add in the nearly 17 million jobs needed for all the young people who will reach working age this year and globally we’re still short nearly 31 million jobs to get back to pre-crisis employment levels.

Canada fared better than most when it comes to employment in the years after the 2008 financial crisis. But it’s not exactly a glowing portrait. According to this graph, we made up some ground in employment, but are still below 2007 levels:

Indeed, despite Mark Carney’s assertions in his final speech as Bank of Canada governor last month that Canada now has 480,000 more jobs than before the recession, we’re still behind when it comes to employment.

We’ve added roughly 980,000 people to our labour force since 2007 according to Statistics Canada data. Our employment rate has actually fallen from 63.5 per cent in the last quarter of 2007 to 62 per cent at the end of last year. (It was actually lower in April, at 61.8 per cent).

The unemployment rate was six per cent at the end of 2007. It’s 7.2 per cent today. It has come down from its highs above eight per cent in 2009, but it has never recovered to pre-recession levels.

The study also ranks countries on “job quality” — whether the jobs created were well-paying, full-time jobs with benefits or part-time and contract work with little job security.

Here’s the overall picture: The best advanced economies are in the top left – Korea, Norway and Poland. They boosted employment, with most of it coming from good jobs. On the other hand, both employment and job quality declined in Greece, Estonia and Hungary:

Here’s a closer look at Canada, where employment went up, but job quality went down. By contrast, the U.S. has created fewer new jobs overall, but those jobs have tended to be better ones:

This graph also doesn’t square with the familiar narrative that many of the post-recession employment gains in Canada have been full-time jobs in the private sector. The bulk of those jobs, it seems, have been temporary contracts, not permanent positions that come with some measure of job security and benefits. Temporary jobs have grown 15 per cent between 2009 and 2012, compared to job growth of less than four per cent among permanent positions.

Also, the middle class is shrinking and income inequality is higher than it was in the past in Canada. But we’re better off than some. (One caveat is that the Canadian data only goes up to 2005):

The last graph may be the most surprising. Overall government spending—including provincial budgets—as a share of the total economy has gone down since 2007, with most of the cuts coming from spending on social services and interest payments on the public debt.


Five depressing charts about the Canadian economy

  1. Ruh-oh…..does Harper know you chewed through your restraints again?

  2. isn’t that’s what Harper wants and thinks we’ll get down on our knees???????

  3. The Bank of Canada is not engaging in obscene amounts of quantitative easing (i.e. money printing) like the United States, Europe, Switzerland, the UK, and Japan.

    i.e. Our monetary policy (extremely low interest rates) is still within the bounds of “normal” monetary policy. Most other developed countries’ central banks are still using “non-normal” monetary policy options like QE in addition to low interest rates.

    Our fiscal deficits (other than the obscene provincial ones in Quebec and Ontario) also tend to be much smaller than those in other countries.

    i.e. The Canadian economy is far less pumped up on stimulants than other economies.

    i.e. The Canadian economy is performing in the same ballpark as everybody else without the performance-enhancing monetary drugs.

    • Same ballpark? Canada is doing poorly. 142nd out of 219 for GDP growth in 2012. We should be doing much better if what you claim is true.

  4. The real story here is the unnecessary length of this recession. Far too long and painful than it had to be because of austerity. Nail. Coffin. Austerity has predictably proven to be a total failure. The lessons of the past have been discarded for a fantastical frightening myth that debt and government spending is the the problem. The few studies that claimed to prove these half baked theories have since been discarded but their champions, still cling to the wreckage, unable to admit their failure.

    This should go down as the most expensive failed experiment ever undertaken by human kind but I fear, the corporate sponsors of this debacle still wish another reality to be created: one in which their plan finally worked and all that pain was worth it as though there was never another far better alternative. I fear the true tragedy of the failed policies of austerity will be swept under the rug.

    This is the time when our media should be telling this story but this is type of article is all we get. Facts without analysis. Sad.

    • Let’s see. No country in sight living within its means. So where is the austerity? Austerity can’t be blamed if it hasn’t even been tried. What has been tried is money printing, by whatever name. That is what isn’t working.
      “Stimulus” funded by borrowing or money printing will not work, certainly has never worked before, yet that seems to be the prescription and the policy.

      Trouble is, governments have promised more than they can steal/borrow/print and have done so long enough to create unrealistic expectations on the part of the populace. Exacerbating the situation is the fact that they have universally spent huge amounts on economically self-defeating projects and favours for the elite, namely military expenditures, bail outs to reckless bankers, civil monuments (bridges to nowhere, airports in the middle of nowhere) etc.
      The only debt that makes economic sense, whether incurred by individuals, corporations or governments, is that which is self-liquidating. Ie debt acquired in the effort to create a wealth-producing asset which will generate a return sufficient to pay off the debt and accrued interest. This is not an activity at which government has a good track record. Any other debt is a burden on the future and comes at the cost of reduced future economic activity.

      • When almost every country in sight cutting taxes before and during a recession is there any wonder that they are not living within their means? If you cut your income you have less money to spend. So, in a recession
        you go into debt and pay it off in good times. You don’t cut in bad
        times. The economies of countries are not the same as households.

        Canada has a very low corporate tax rate now but that has not created the jobs and prosperity and investment promised except for the corporations who then sit on it or invest it in some other country. As the tax cuts were been implemented, productivity actually dropped which means companies were not investing in better equipment.

        Austerity is being tried on a wide scale in Europe with devastating results.

        Stimulus never worked before? Did you just move here from mars? New deal 1933 US depression was followed by huge growth. Then there were stimulus packages in 1964, 1971, 1975, 1981 and 2001. The packages in the 60’s and seventies were less effective probably because they were slow to implement but from the eighties on they have had good success in helping the US economy to recover. Elsewhere the 35 billion stimulus in 2009 by the conservatives in Canada barely kept us from falling off the edge. Gordon brown’s UK stimulus of a paltry 30 billion helped a bit but was not enough.

        I agree that stimulus should be used for investment but free market radicalism does not work on it’s own. We need a mix of government and private industry. This has worked very well in the past, despite what you say, and will work again but people have been hoodwinked by the neo liberal cheerleading of media pundits and think tanks.

  5. @ Demand, another believer in the Pollyanna pablum fed in public school
    history books.

    Policies of both Hoover and Roosevelt deepened and prolonged the 30’s Depression, which, by the way, was a direct result of excessive money supply in the (Roaring) ’20’s and consequent malinvestment and debt accumulation.
    “Treasury Secretary, Henry Morgenthau, May 1939: “We have tried spending money. We are spending more than we have ever spent before and it does not work. And I have just one interest, and now if I am wrong somebody else can have my job. I
    want to see this country prosper. I want to see people get a job. I want to see people get enough to eat. We have never made good on our promises. I say after eight years of this administration, we have just as much unemployment as when we started. And enormous debt to boot.”
    Morgenthau made this “startling confession,” as historian Burton W. Folsom Jr. calls it, during the seventh year of FDR’s New Deal programs to combat the rampant unemployment of the Great Depression, in a speech to fellow Democrat members of the House Ways and Means Committee.

    The New Deal was not followed by huge growth, there was some temporary growth,
    and then a slide right back into Depression. Under FDR’s misguided policies, farmers were forced to cut production when people were going hungry.
    Then came WW2, which did not get the USA out of the Depression. It was a period of forced saving: with propaganda and coercion to buy war bonds, no consumer goods available, rationed essential goods, deferred family growth. The boom happened post war, assisted by the fact that virtually all American competition was obliterated.

    Again, your definition of austerity is misguided, if not Orwellian Newspeak.
    Countries ARE like families when it comes to fiscal matters. Yes, most sovereign countries can print their own currencies, but this does not create wealth, it only places buying power in the hands of not earned it (the banksters and their hirelings), at the expense of those who have created or earned wealth, by way of inflation/debasement. And if the government (family father) takes too much of the earnings of wealth producers (say, family children), they will rebel: refuse to work, work less, go underground etc.

    There is no free lunch in economics, wealth has to be created before it can be consumed. Dollars, pounds, euros, yen, etc are claims to wealth, not wealth in and of themselves. If it were otherwise, all Zimbabweans would be rich. Yet you assert that the problem is that taxes are not high enough. The unfunded liabilities plus accumulated national debt of the United States is so high (well over $200 Trillion, per Prof. Lawrence Kotlikoff, U Boston) that taxing every person and every corporation at 100% (as if anyone would continue to work) is insufficient to offset the annual increase in liabilities. The problem is the spending, both the magnitude and the purpose. How can
    governments possibly do a better job of spending your money than you can?