Job growth slows, quality lacking: CIBC
The Canadian economy generates 17,000 new jobs a month in third quarter, compared to 33,000 per month in the first quarter of 2011
TORONTO—The pace of job growth in Canada is slowing and the jobs being created are of lower quality, according to CIBC’s latest Canadian Employment Quality Index (EQI).
The Canadian economy generated only 17,000 new jobs a month in the third quarter of 2011, down from 29,000 new jobs a month in the second quarter and 33,000 in the first quarter.
The EQI fell by 0.5 per cent in the third quarter and is down by 1.5 per cent over the past seven months.
“The decline in our quality index over the past seven months is not so obvious when one glances at the headline statistics,” says Benjamin Tal, deputy chief economist and author of CIBC’s Employment Quality Index.
“During this period, paid employment rose faster than self-employment and full-time job creation outpaced growth in part-time jobs. The reason for the index’s decline, despite these positive indicators, is the fact that all the fulltime jobs created during this period were in low-paying sectors.”
The decline in the EQI followed a rebound in job quality beginning in early 2010. The current index sits roughly where it was when the economy was on the brink of recession.
But job quality is not uniform across the country. Ontario, B.C. and Atlantic Canada weighed down growth with declines in overall employment quality.
Alberta, Quebec, Manitoba and Saskatchewan saw improvement in the last seven months.
- Full-Time vs. Part-Time Jobs: Full-time employment rose by 1.2 per cent in the last seven months.
- Self-Employment vs. Paid Employment: Paid employment rose by 1.2 per cent vs. only a 0.1 per cent increase in the number of self-employed.
- Compensation: The number of full-time jobs in high-paying industries fell by 0.1 per cent while the number of jobs in low-paying industries rose by 2.3 per cent. The most notable weakness was in high job quality sectors such as the federal government, heavy and civil engineering construction, telecommunications and computer and related manufacturing.
Strong job growth in sectors such as machinery manufacturing and professional scientific and technical services helped to limit the damage.