GUNTER: Employment crisis masked by government hiring

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Published Sep 07, 2024  •  Last updated 0 minutes ago  •  3 minute read

Not including the pandemic, unemployment is now at 6.6%, higher than at anytime since 2017. Photo by File photo /Postmedia

Canada would already be in a recession if it weren’t for huge increases in public-sector spending and employment.

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Friday’s jobs report from Statistics Canada shows that, indirectly.

The headlines mostly focused on unemployment, which rose in August to its highest level in seven years. Not including the pandemic, unemployment is now at 6.6%, higher than at anytime since 2017. (By contrast, U.S. unemployment fell to 4.2%.)

That’s bad enough, but the true depth of our employment crisis is masked by government hiring. Of the 94,400 thousand jobs created last month, 55% were created in the public sector. Meanwhile, of the 72,400 jobs lost, 91% were lost in the private sector.

Canada’s public sector is booming while its private sector is shrinking.

The problem is you cannot grow an economy forever on public-sector spending. It’s unsustainable.

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When the private sector creates a job, it generates wealth. It produces and sells a new product or service, or increases investment or develops a new, more-efficient way of doing business. That adds to GDP.

To create a new job in the public sector, some government has to tax away wealth from the private sector. Growing the public sector by shrinking the private sector is a form of economic cannibalism.

When StatsCan points out that the health and social services sectors “accounted for nearly half (49.6%) of total net employment growth” in Canada in August, you may think “Finally, maybe now the overcrowding in our ERs will ease.” But to fund that increase, money had to be taxed away from individual workers and private companies.

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Last month 66,000 private-sector jobs were lost. The sectors losing the most were natural resources, utilities, building maintenance, accommodation and food services and “professional, scientific and technical services.”

In one month alone, we lost over 16,000 professionals, scientists, researchers, lab tech and computer specialists. In a world increasingly driven by innovation and intelligence, that’s not a good trend.

To make matters worse, the Liberals are still admitting immigrants at a rate of nearly 100,000 a month. So far this year, they have admitted 704,000, which puts us on pace for another 1.2 million intake of newcomers in 2024.

Just in August, this influx of newcomers added 82,500 people to the workforce, in a month in which only 22,000 net new jobs were added. So far in 2024, our government has added 408,000 workers to the labour force while its economic policies have led to the creation of just 174,000 jobs, a third of which are part-time.

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You don’t have to be anti-immigration to think this math is insane. Indeed, it’s just as unfair to new Canadians to invite them into a country whose economy is stagnant and producing too few jobs for them, too.

One particular stat that jumps out of last month’s data: This is especially hard on young Canadians. While the overall unemployment rate is 6.6%, the rate among those 15 to 24 years old is 14.5%. It’s tough finding summer jobs and first career jobs.

For all intents and purposes, Canada is in a recession caused by lack of foreign investment, poor productivity, aging infrastructure and industrial machinery, and the attack on fossil fuels – all of which are the results of policy choices made by the Trudeau government. Their anti-business attitude has scared away investors. Their taxation policies are discouraging investment in industrial innovation and encouraging an increasing number of skilled workers to leave.

On top of that, their out-of-control spending (federal government spending is up nearly 15% over this time last year) and high-interest policies have driven inflation up and business activity down.

On housing affordability, inflation, investment, job creation, industrial modernization, immigration and GDP growth, the most-woke government in our history has been an unmitigated disaster.

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