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UNEMPLOYMENT RATE - OFFICIAL
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STORY 1:-
THE OTTAWA CITIZEN BUSINESS WEDNESDAY, SEPTEMBER 22, 1999
Determining the jobless rate in Canada
Measuring the U.S. way would lower rate:
StatsCan
By ERIC BEAUCHESNE
■ Canada's unemployment rate last year would have been more than a half point lower if measured the American way. But it still would have been more than three points higher than the U.S. rate. Those are among the findings in a report yesterday by Statistics Canada into alternative measures of unemployment. The federal agency is trying to paint a clearer picture of some hidden aspects of the job market.
■ The US, for example, doesn't count someone as unemployed unless he has actively searched for a job, whereas anyone in Canada who has merely looked at the help-wanted ads is included among the jobless. If Canada followed the U.S. model, the unemployment rate here last year would have been 7.6 per cent instead of the official 8.3 per cent, still way above the 4.5 per cent in the U.S.
■ StatsCan also looked at other alternative measures such as two that examine longer-term unemployment. These measures tell a lot about the hardships faced by the jobless, the agency says. "It is useful to know the extent of long-term unemployment since those out of work for prolonged periods of time are more likely to suffer financial loss and may have a harder time of finding a new job, Statistics Canada noted. For example, those out of work for more than a year can no longer collect benefits and may have used up their savings.
■ Unlike the official jobless rate, which tends to decrease with age, long-term unemployment is highest among older workers, who find it more difficult to find jobs once they are unemployed.
■ Many of the alternative measures of unemployment are higher than the official rate, and reflect the proportion of unused labour in the economy. For example, if discouraged workers - people who want jobs but aren't looking because the work isn't available are counted among the unemployed, the rate last year would have risen by one-half point to 8.8 per cent.
FULL STORY:-
THE OTTAWA CITIZEN -----BUSINESS -----WEDNESDAY, SEPTEMBER 22, 1999
Determining the jobless rate in Canada
Measuring the U.S. way would lower rate:
StatsCan
By ERIC BEAUCHESNE
Canada's unemployment rate last year would have been more than a half point lower if measured the American way.
But it still would have been more than three points higher than the U.S. rate.
Those are among the findings in a report yesterday by Statistics Canada into alternative measures of unemployment. The federal agency is trying to paint a clearer picture of some hidden aspects of the job market.
In this renewed effort, StatsCan is showing the extent of long-term unemployment and taking a measure of the slack in the Canadian labour force. It is also trying to give a true comparison of US. and Canadian joblessness.
The US, for example, doesn't count someone as unemployed unless he has actively searched for a job, whereas anyone in Canada who has merely looked at the help-wanted ads is included among the jobless.
If Canada followed the U.S. model, the unemployment rate here last year would have been 7.6 per cent instead of the official 8.3 per cent, still way above the 4.5 per cent in the U.S.
Some analysts argue the gap would be even less if not for Canada's more generous insurance system. The EI system, however, is no longer as generous as it once was, with less than 40 per cent of the unemployed now getting benefits, compared with more than 75 per cent at the start of the decade.
StatsCan also looked at other alternative measures such as two that examine longer-term unemployment. These measures tell a lot about the hardships faced by the jobless, the agency says.
"It is useful to know the extent of long-term unemployment since those out of work for prolonged periods of time are more likely to suffer financial loss and may have a harder time of finding a new job, Statistics Canada noted.
For example, those out of work for more than a year can no longer collect benefits and may have used up their savings.
The long-term unemployment rate - the proportion of the labour force out of work for a year or more - was 1.1 per cent last year.
The proportion out of work three months or more, suggesting they may face hardship as well, was 3.3 per cent.
Unlike the official jobless rate, which tends to decrease with age, long-term unemployment is highest among older workers, who find it more difficult to find jobs once they are unemployed.
Those without a high school education are also more likely to be among the long-term unemployed.
Long-term unemployment also reflects regional conditions, and is highest in Newfoundland at about three per cent and lowest in Alberta at only 0.3 per cent.
Many of the alternative measures of unemployment are higher than the official rate, and reflect the proportion of unused labour in the economy.
For example, if discouraged workers - people who want jobs but aren't looking because the work isn't available are counted among the unemployed, the rate last year would have risen by one-half point to 8.8 per cent.
People are also working part time because they can't find full-time employment. If the shortfall in hours worked is included in the official jobless rate, StatsCan says, the rate would hit 10.6 per cent.
The most comprehensive supplementary unemployment rate includes discouraged workers, involuntary part timers and those who aren't working but aren't looking for a job, such as waiting to be recalled by a former employer. That rate was 11.5 per cent last year, or 3.2 points higher than the official jobless rate of 8.3 per cent.
End of
Story 1
STORY 2:-
THE OTTAWA CITIZEN -THE EDITORIAL PAGE -TUESDAY, DECEMBER 7, 1999
A slow
waltz toward
full
employment
LAWRENCE MARTIN
THE NATION
■ Late last week it was announced that Canada's involuntary leisure rate had fallen to 6.9 per cent. For the first time in a rather hellish run of almost two decades, unemployment was under seven per cent.
■ In real numbers, 6.9 per cent means that there are 1.1 million Canadians out of work.
■ Unemployment is diminishing, inflation is in check, there is no recession in sight and in terms of long-range trends, Canada and other leading democracies have in their pockets the big ace card of demographics. Before long, the baby boomers will be reaching retirement age and there will be far smaller numbers of job-seekers for the Canadian and other economies to satisfy.
FULL STORY:-
THE OTTAWA CITIZEN -THE EDITORIAL PAGE -TUESDAY, DECEMBER 7, 1999
A slow
waltz toward
full
employment
LAWRENCE MARTIN
THE NATION
The polite term for it is involuntary leisure. Late last week it was announced that Canada's involuntary leisure rate had fallen to 6.9 per cent. For the first time in a rather hellish run of almost two decades, unemployment was under seven per cent.
Craig Wright, deputy chief economist at the Royal Bank of Canada, was dancing in the streets. "We are now near full employment," he crowed. By Canadian standards, he went on, the news was very good. "I'm not sure how much lower it can go."
In real numbers, 6.9 per cent means that there are 1.1 million Canadians out of work. To some, that's a lot of involuntary leisure. About five Reginas worth or 20 Frederictons. Mass idleness, you might say. The slow waltz to nowhere. To others - ain't nothing like the banker's perspective - it's darn close to nirvana. As Wright says, we're maxing out.
Times change and so do priorities. For the 1950s, the average unemployment rate in Canada was 4.2 per cent. For the 30-year period from 1950 to 1980 it was 5.3 per cent. In those days 6.9 per cent was scandal zone stuff. For example, in Unemployment in History, the authoritative study on unemployment, John A. Garraty noted that in 1951 the British government announced that it would henceforth never tolerate a jobless rate of more than three per cent. It was 1.6 per cent that year. That kind of activism wasn't entirely new. Through time, as Garraty makes clear, the effort to engage the masses was often concerted. In ancient Athens, Pericles undertook vast public building projects to discharge the city of the idle. Jean Chrétien, our prime minister, might wish to cite this example in his next speech. He has those hefty job-creation grants to his Shawinigan riding to defend. "For me, you know," he could say, "it's da same as dat little guy, Pericles."
The eradication of unemployment lost ground on the priority charts in the late 20th century to the newer disease of inflation. The three-per-cent ceiling that was Britain's was later picked up in Canada - only it wasn't for unemployment. In 1994, Ottawa announced a three-per-cent limit for inflation. On involuntary leisure, no such restraint was put. That beast could run wild, which it did.
It became the conventional wisdom, certainly among the bankers, that inflation couldn't be kept low unless unemployment was kept high, around eight per cent.
On this, fortunately, the economists have been proved to be out to a voluntary and leisurely lunch. In recent times, the experience in the United States, where unemployment is at 4.1 per cent and inflation even lower, shows that it is well possible to have few people out of work and price stability at the same time.
Maybe the old ceiling of three per cent for both the jobless and inflation can be restored. In the context at least of the last two decades, the federal government's new jobless numbers certainly are encouraging. They are so encouraging that, along with all the other bright economic news, the Chrétien government will be less inclined to change course and bring in bold tax-cut measures. The prime minister will feel vindicated that his economic strategy has been right all along. No need for change.
Along with the fallacy of low inflation requiring high unemployment, recent trends help put to rest another gloomy hypothesis. This is the idea that machines are replacing workers, that the new scourge, as in 'The End of Work' by Jeremy Rifkin, as in bank teller machines taking over from bank tellers, will be technological unemployment.
But for the strong counter-argument, not only is there the lesson of history which demonstrates that technological innovation leads, after a short-term slide, to increased demand for labour, but again the example of the U.S. The world's technological leader is also the world's leader in job creation.
As the riots in Seattle last week over world trade policies suggest, labour, having taken such a beating since 1980 is hardly at peace with the ways of the world. But it is hard to deny that on job creation, there is tracking in the right direction. Unemployment is diminishing, inflation is in check, there is no recession in sight and in terms of long-range trends, Canada and other leading democracies have in their pockets the big ace card of demographics. Before long, the baby boomers will be reaching retirement age and there will be far smaller numbers of job-seekers for the Canadian and other economies to satisfy.
We may well reach the point where 1.1 million in a state of involuntary leisure won't be cause for cheering.
Lawrence Martin writes on national issues for The Citizen.
End of Story 2