February’s jobs report, released last week by Statistics Canada, was met with nearly unanimous rousey headlines. There’s no doubt much to celebrate in the results of the latest Labour Force Survey (LFS). But, once again, digging below the surface reveals that many workers still face a host of persistent and structural problems in our contemporary economy.
What’s more, insofar as the headline numbers were largely positive, mainstream commentators have drawn entirely the wrong conclusion: rather than congratulate the federal government for guiding the economic ship out of the rough waters of the pandemic, we should be using the occasion of a relatively stronger labour market to build the collective power of workers. This is especially the case with a new federal budget on the horizon that seems likely to disappoint and a business community actively calling for a return to fiscal austerity and debt reduction.
The Canadian economy gained 337,000 net jobs in February, more than offsetting the losses that resulted from lockdowns in Ontario and Quebec in January. These job gains raised employment by 1.8 per cent and brought unemployment down to 5.5 per cent, lower than the 5.7 per cent unemployment rate observed just before the pandemic began. Total hours worked were also up 3.6 per cent, a healthy increase which demonstrates that more workers are returning to full- or close to full-time hours.
Jobs gains were almost entirely concentrated in the private sector, with public sector employment levels seeing little change. This is unsurprising given that January’s lockdowns mostly impacted public-facing private sector service workers, though gains weren’t concentrated entirely among industries affected by COVID-19 restrictions. Correspondingly, the accommodation and food service sector led with 114,000 new jobs last month, a growth of 12.6 per cent. While these job gains are notable, the sector is still well below pre-pandemic levels, with 17.2 per cent fewer jobs than in February 2020. Total hours worked in accommodation and food service were also still 18.4 per cent below where they were pre-pandemic.
It remains an open question how the lack of a full job rebound in the low-wage service sector should be interpreted. Some would suggest that we had far too many workers in these low-wage and low productivity jobs to begin with (I would agree). Fewer jobs could therefore be a reflection of workers getting better work elsewhere, as this study suggests, which would be a net positive, even if some small business owners are upset about it. Shifting our labour capacity to higher productivity and higher-wage sectors is long overdue.
Self-employment remains well below pre-pandemic levels, still down 8.5 per cent. On this front, it seems as though we’re witnessing somewhat of a structural change as self-employment becomes either less feasible or less desirable. Either way, because so many “self-employed” workers were often in precarious situations with low incomes and little security, having fewer people in this category is likely also a welcomed development.
Core-aged men and women both saw employment gains in February, which is a good sign in a pandemic that has disproportionately sidelined women. The employment rate for men between the age of 25 to 54 is now 88.2 per cent; for women it is up to 81 per cent. This is the highest core-aged male employment rate since 1981. For women, it is a record high.
However, it’s notable that, for women, full-time employment gains were 0.7 per cent while part-time gains were 5.4 per cent; for men, all employment gains were in full-time work. The LFS doesn’t disaggregate to indicate how much part-time job growth was involuntary, i.e. among people who wanted to work more hours than were available.
Women have long been over-represented in the part-time labour force. In many cases, gender segregation in the labour market results in women being unable to get the number of hours they desire. However, in other instances, women “choose” part-time work in order to accommodate their unpaid caregiving responsibilities outside of work. Although part-time work is a notionally free choice in the latter example, it needs to be understood in the context of a political economy that still depends on women to do the vast majority of unpaid, social reproduction work at home, and then punishes them for it in the labour market.
While core-aged workers made gains in February, workers 55 years and older continue to face challenges. The employment rate of men aged 55 and older didn’t change from January and remains 1.8 per cent below pre-pandemic levels. For older women, all employment gains in February were in part-time work. Because the proportion of working women in this age group has grown, their employment rate is now also 1.1 per cent below its pre-pandemic level.
Despite not being fully free from the threat of the pandemic, there are nevertheless positive signs on the labour front. But we should be careful to not overestimate these.
In all, 1.14 million people remained unemployed in February, despite historically low unemployment. In particular, 212,000 workers were still in the category of the “long-term unemployed,” i.e. those who are continuously unemployed for 27 weeks or more. While this shrank, it was still 32,000 workers more than in February 2020. The adjusted unemployment rate, including people who wanted a job but didn’t look for one, was still 7.4 per cent. “Labour underutilization,” which encompasses all those who are unemployed, want a job but can’t find one, or are working fewer hours than they would prefer, fell by 3.8 per cent, but remained elevated, at 12.1 per cent. Simply put, that’s a huge pool of workers who want decent jobs and could be doing important work if we had anything close to a rational approach to labour allocation.
Total hours are up, but still more than half a million people were working fewer than half or fewer of their usual hours, including people absent due to a personal illness or disability. Although employment growth among core-aged (25 to 54 years) Indigenous and racialized workers was a positive sign, significant employment gaps and economic inequality persist.
Despite employers publicly warning of a general labour shortage, there is very little evidence to support their claim. If Canada was experiencing a severe labour shortage, wages would be rising sharply. The numbers don’t bear this out. According to the LFS, wages are up 3.1 per cent. This is below current inflation, which sits at 5.1 per cent. Moreover, even that level of wage growth has been highly uneven, with many industries and workers settling for much less.
Moreover, unlike for a period in the United States, there is no sign of a “great resignation” in Canada. The number of “job-leavers” (people who left their job and remained not employed) was 13.4 per cent lower than February 2020. Similarly, the job changing rate was low in February, at 0.7 per cent, similar to pre-pandemic. Although a meaningful number of workers left poor paying jobs in the service industries for better opportunities as we began to ease public health restrictions months ago, it seems this phenomenon has largely ceased. People are generally staying put in their jobs.
What should the left make of all this? For one, the headline figures are almost never as positive as they appear. Unemployment, labour underutilization and slow wage growth persist as significant problems.
Second, for decades politicians committed to neoliberal orthodoxy have pushed privatization, public spending cuts and deregulation of labour markets. Insecure and precarious employment were the entirely predictable result. This isn’t going to be undone by some mild improvements in the labour market, most of which are the result of a temporary economic rebound. Rather, eliminating employment insecurity necessitates sustained government commitment and robust fiscal stimulus and public job creation.
Last, insofar as we are experiencing a momentarily “tight” labour market that is swinging the pendulum back in labour’s favour, if tepidly, we need to use this to organize far greater numbers of workers into unions. Labour market conditions are simply not enough to lift wages and improve working conditions; only the organized and collective power of workers can accomplish this.