Statistics Canada reported today that April was another good month for the labour market. The Canadian economy added 58,200 jobs, most of which were full-time and all of which were paid positions rather than reported self-employment.
Paradoxically, official unemployment increased as more Canadians entered the labour market. This development provides an important reminder that unemployment is actually even worse than the official tally of 1.4 million.
Hundreds of thousands more have been discouraged from looking for work by the recession, but will try again when the labour market shows signs of life. The policy challenge is to create jobs not only for those officially counted as unemployed, but also for this reserve army of discouraged workers.
Unfortunately, government policy is moving in the opposite direction. Budget austerity is proving to be a drag on the labour market, with the public sector shedding 19,200 employees in April.
Ontario’s private sector also subtracted from the national figures, shedding 9,300 jobs in April. Worse still, provincial unemployment leapt by 32,800. Ontario’s average hourly wage rose by a measly 0.7% over the past year, less than one-third of the provincial inflation rate.
Erin Weir is an economist with the United Steelworkers union and a CCPA research associate.
UPDATE (May 12): Quoted in The Hamilton Spectator