As I have said in the past, I am not a huge fan of looking at the month-over-month labour force survey data because there can be significant swings on a monthly basis – even in the seasonally adjusted data. I prefer the annualized data – and that stuff is now out for review.
I took a look at the employment figures by sector and we are seeing a worrying trend. New Brunswick shed employment from 2007 to 2010. Three full years with no growth in total employment is not a good omen but when you dig deeper there are worrying signs. First, the call centre employment reduction that started in the mid 2000s continues. While these jobs are not categorized in a single sector of the economy, there is a cluster of them in “Business, building and other support services” which has been on a steady decline. With reductions at UPS, Purolator and others I expect this employment to decline even further – not fall off a cliff – but continue to slowly decline. More worryingly construction employment is up over 5,000 jobs in just three years – I assume this is in large part on the back of the stimulus – which is winding down as is the potash expansion. The nuclear plant refurb is also slated to wind down over the next year. Forestry has likely bottomed out but overall manufacturing is not likely to rebound much in the coming few years.
Finally, public administration and health care added almost 7,000 jobs over the past three years. That, I also assume, will stop in the next few years. It is unlikely to outright decline but the growth will be dramatically reduced.
The compounding problem is that as government ratchets down public spending there are fewer cars and TVs sold. There are fewer houses bought. The point is all the service sectors that rely heavily on in market consumer spending will be pressured – not as much as you might think – public service workers that are early retired move on to a 60% or so pension that is still expended in the local economy.
In the end, the government is likely to see continued tepid job numbers for a while and it needs to be focused on a new economic development agenda. Infusing the economy with private investment and job creation will offset much of the losses in the public sector.
Easier said than done.
Employment in New Brunswick (2010) – and 3 yr comparison
|000s||07 to 10|
|Total, all industries||356.1||-0.3%|
|Forestry, fishing, mining, quarrying, oil and gas||10.5||-2.8%|
|Forestry and logging with support activities||3.8||-9.5%|
|Fishing, hunting and trapping||1.8||-10.0%|
|Mining, quarrying, and oil and gas extraction||4.9||8.9%|
|Transportation and warehousing||18.9||0.5%|
|Finance, insurance, real estate and leasing||15.8||-0.6%|
|Finance and insurance||11.6||1.8%|
|Real estate and leasing||4.2||-6.7%|
|Professional, scientific and technical services||15.6||2.0%|
|Business, building and other support services||17.4||-11.7%|
|Health care and social assistance||50.1||5.7%|
|Information, culture and recreation||12.7||-3.8%|
|Accommodation and food services||20.8||-12.2%|
Source: Statistics Canada Labour Force Survey