The male unemployment rate is now 14% in New Brunswick

I don’t know if I am supposed to be distributing this labour market bulletin but it is a public federal government publication.  Someone is good enough to send it to me so I pass it on to you.

The year-over-year data for NB is about as grim as I have seen in a long time.  Total employment is down 6,000 jobs, full time down 9,000 jobs – year over year.  The unemployment rate is up to 9.8% – flirting with 10% for the first time in about a decade.

Public administration employment is up by 4,000 (Feb 2011 from Feb 2010) or the employment picture would have been worse.  Health care employment is up by 3,000 year over year.

The male unemployment rate is now almost 14% compared to 7.5% for females.   The female unemployment rate did not change year over year, the male unemployment rate is up two full percentage points.   At double the female rate, this should be very worrying to government and community leaders.    In recent years there has always been a gap in male/female unemployment but this spread is very serious.

I guess its a pretty good time to start listening to those that have some insight into these numbers.  The construction employment will wane with the drop in public sector spending.  The health care and public admin numbers will wane with the tightening of public spending and the spin off effects into the rest of the economy will be significant.  The call centre industry will continue to slowly shed employment.  All of this will put serious downward pressure on tax collection by government pushing a potential downward spiral.

I don’t claim to be an expert on this stuff but I have studied it enough to know that there doesn’t seem to be a silver bullet on the horizon.  The Lord government used public spending and a few mega projects (oil refinery) to prop up economic growth.   Graham rolled up huge public deficits to prop up economic growth in the last couple of years.   Premier Alward has neither of these tools at his disposal.

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4 Responses to The male unemployment rate is now 14% in New Brunswick

  1. John Eric Pollabauer says:

    If you were advising an international company interested in locating a branch manufacturing/distribution centre in Eastern Canada, what, in your opinion, would be the pros and cons for choosing New Brunswick?

  2. The pros are the competitive operating cost environment, relatively low corporate tax environment, a supportive local community, etc. There is still some slack in the labour market – particularly if the manufacturing/distribution centre in question was paying wages levels above the median level. In places like Moncton there are a number of larger buildings available at reasonable rents for manufacturing activity. Utilities costs for average level users of electricity are competitive with the exception of natural gas.

    On the con side, natural gas costs are high compared to places like Ontario. A heavy user of natural gas would find it challenging in New Brunswick. Depending on the distribution profile of both the raw materials for the plant and its end markets – transportation costs could be onerous. For most manufacturing firms, this wouldn’t be a large problem given that transportation costs are only a fraction of overall costs. As I said if the company was paying at or below the median wage level for manufacturing, they might have trouble finding workers – unless they located in a community where there is a very high unemployment rate. I think the days of companies coming here and looking to pay $10/hour or under for quality workers are over. The average manufacturing wage in New Brunswick is $18.75/hour. Any new firm coming in would need to be at or above that level.

    If you have any specific areas of interest, let me know. I could refine these answers with more details on the potential project.

  3. scott says:

    There could be a silver lining to all this if the province finally decides to adjust the cost structure in response to the downturn.

  4. Anonymous says:

    @David Campbell

    I can add a few more cons: small local market, distance from major markets, small local labour market, limited cultural life, absence of a major urban centre. The last three are very important to attract and retain highly qualified labour and/or managers. They may come and tolerate it for, say, a couple of years. But over time the wives or husbands start having trouble finding jobs that allow them to keep up their significant others, and so on.

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