THE TRUE UNEMPLOYMENT RATE
This page gives some of the background concerning my interest in the unemployment problem.
As I have said elsewhere on this web site, I appeared before the federal Standing Committee on Human Resources Development on March 9th, 1994, during the Phase I Public Consultations which the Committee conducted as part of its work towards reforming the Unemployment Insurance Act (which became the Employment Insurance Act on July 1st, 1996). On that occasion, I gave a presentation concerning how we should set about re-training unemployed persons and how success in this depended partly on other things - such as helping exporters and more particularly those in the Hi-Tech sector, as the basis for generating new jobs in the numbers needed.
I also made a rather similar submission - written - to the then-Minister of Human Resources Development, the Honourable Lloyd Axworthy.
Mr Axworthy's reply to me, dated June 8th 1994, clearly indicated that it had been taken seriously.
I did not then mention the true size of the unemployment problem to the Committee, because I had no concrete figures immediately to hand - though I knew from personal experience that there was a big problem.
I also thought that everyone was sufficiently aware of it as to need no reminders. How wrong I was. There was no mention of the true numbers in the Committee's Final Report - "Security, Opportunity and Fairness" - released on February 5th, 1995, but I was still not unduly concerned. Then in July 1995, I saw two articles in the same newspaper which each occupied more than one whole page: one of them was about the unemployment rate and mentioned 1.5 million as being the number of unemployed throughout Canada, the other was about social assistance in Ontario and mentioned that there were then 1.3 million social assistance recipients IN ONTARIO ALONE - YET THESE SAME PEOPLE WERE NOT COUNTED AS "UNEMPLOYED"!! How was it possible that all these people could be on social assistance, and yet not be counted as "Unemployed"? They were on social assistance because they had no income from gainful employment.
In Canada as a whole, based on the Ontario sample and an assumed Ontario population of 10 million out of 27 million for the whole of Canada, it was apparent that there were about 3.5 million social assistance recipients in Canada: adding to this the number of "officially unemployed" at 1.5 million, you got a rough estimate of the true number of unemployed in all of Canada at 5 million.
At about this time, I had just been introduced to Bob Chiarelli who at that time was Ontario M.P.P. for one of the Ottawa area provincial ridings. We got talking about this and related things. I had just realised the shocking truth about the size of the problem, and wrote a report for Bob Chiarelli along with my recommendations as to what should be done about it. There were also some extremely serious problems with Ontario's provincial social assistance programs, which I also dealt with.
Some documents referenced above, highlighted in RED, can be accessed from HERE
Since then - on December 1st 1998 - Bob Chiarelli became Chair of the Regional Municipality of Ottawa-Carleton (R.M.O.C.) and is now Mayor of the City of Ottawa, following the recent amalgamation of the former R.M.O.C. plus some other municipalities.
.In March 1999, an article in "The Ottawa Citizen" revealed that he had challenged local business people to create 145,000 jobs, in response to a report entitled “Ottawa’s Hidden Workforce” released by the Ottawa Economic Development Corporation in the Fall of 1998. At the same time, Bob Chiarelli announced the formation of his Task Force “Partners for Jobs” , to deal with the problem. The Final Report of the Task Force, released in 1999, revealed to me the true reasons for the mis-leading reports which had been and still are continually appearing in the media regarding the unemployment numbers. One of these reasons is an HRDC category, "Not in the Labour Force", which in fact includes some unemployed people (such as those whose E.I. benefits have expired without them being able to get work - they have been hidden in the HRDC figures, simply by dropping them into a different category).
In an early analysis that I made in 2001 , comparing the "Ottawa's Hidden Work Force" figures with the "official" figures from HRDC, I dealt with why the HRDC figures were mis-leading, and concluded that the only realistic numbers available were those arrived at in the "Ottawa's Hidden Work Force" report. Therefore, the true number of unemployed in the Ottawa Census Metropolitan Area as at Fall 1998 was about 145,000 in a total population of just over 1 million. Assuming that the whole of Canada has a population of 30 million and that the Ottawa sample is representative of it, we arrive at an estimate of about 4.3 million unemployed for the whole of Canada. Some recent (1999) Statistics Canada figures have suggested that the figure could be as high as 7 million - and for reasons which will be obvious to most people, any estimate for Canada based on the Ottawa sample will be lower than the true number. My original - very crude - estimate in July 1995 for Bob Chiarelli was 5 million. Doesn't that make you think?
The H.R.D.C. figures may reflect commonly-agreed methods in certain countries for counting and reporting upon the numbers of unemployed.
On the other hand, they are completely useless for internal goal-setting and planning purposes in Canada.
In particular they under-state, by a factor of about 4, the numbers of additional jobs needed in order for government to optimize revenues for the tax base.
Any engineers or certain other types of professionals reading this will be familiar with the P.A.B.L.A. (Problem Analysis By Logical Approach) methodology for problem-solving. You - that is, EVERYBODY - have/has to begin by defining the problem properly in the first place - conversely, if it is kept hidden, then it won't be apparent and won't get solved.
NOW HERE ARE SOME OTHER THINGS FOR YOU TO ASK YOURSELF !
1. How can Winnipeg Centre have 77% of its families living in poverty when its unemployment rate is "only" 13%? You don't believe what I am saying? You think this is a stupid question? Then look at this:-
If you look at the article, you will see that it uses the term "unemployment", not "official unemployment" - so most people looking at it will think it refers to the real unemployment rate, without any further thought (and you can assume that they are probably fed up with the subject anyway, so won't be interested). It seems to me that most if not all media reporters think of "unemployment" and "official unemployment" as one and the same thing - because, as you would expect, they will rely on information from "official" sources more than anything else.
2. How do you think the politicians, up to and including the Prime Minister - and everybody else - get their information about the unemployment rate? They read the newspapers, just like everybody else. Don't believe me? Then look at this:-
3. Do you still not believe what I am saying about media reports based on HRDC and Statistics Canada figures for unemployment? Then look at these:-
4. Do you think we have as much time as we would like to solve the problem - or that we can be content with the idea that once the baby boomers start retiring, there will be fewer job-seekers? Shouldn't we be doing something about maintaining the numbers of people working, by letting in more immigrants - so, in turn, shouldn't we be working flat out to ensure that there will be enough jobs for those immigrants (as well as all Canadians who are unemployed in real terms), so that they can contribute to the tax base and help pay for health care? What are we doing about ensuring that they are not discriminated against in the job market, based on "lack of Canadian experience"? Why is nobody talking about internship-type employment contracts for all these people, to guarantee them supervised work for at least the period needed to meet the Canadian experience requirements of the professional licensing bodies such as the A.P.E.O. (Association of Professional Engineers of Ontario)? People respond best to positive incentives, not legal bullshit and short-sighted discrimination. Do we want foreign-trained engineers, doctors etc. washing dishes in restaurants, driving cabs or painting walls? You think immigrants are welcome because they are "supposed" to be willing to do work that Canadians don't want? So you think, for the same reason, that they should be confined to work which will result in them making minimal payments into the tax base, to pay for Canadians' health care? Why have these problems been allowed to persist for decades? WAKE UP !
HELLO! Is there someone out there who has some brains?
Look at this:-
5. How do you think we are going to create all the jobs needed? Do you think the private sector business community knows what is going on, or even cares? Look at this:-
I THINK WE'D BETTER ALL WAKE UP, DON'T YOU?