NWT's high employment rate questioned
Stats revealing territory has highest employment in Canada likely not representative of economic reality says Chamber of Commerce
Meagan Leonard
Northern News Services
Monday, April 18, 2016
NORTHWEST TERRITORIES
The high employment figures released by the territorial statistics bureau last week may not reflect the economic reality according to the NWT Chamber of Commerce.
The NWT Chamber of Commerce is questioning whether Statistics Canada figures showing that the territory has the highest employment rate in the country are accurate. - NNSL file photo
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The latest labour force survey released April 8, stated the NWT currently has the highest rate of employment in Canada at 69.3 per cent; however, these numbers do not take into account the Snap Lake losses, percentage of fly-in, fly-out workers or large temporary projects says chamber executive director Mike Bradshaw.
"The people that got let go by De Beers got an attractive severance package so they're not included in unemployment figures," he explained. "You've also got the up-tick in industrial jobs as a result of Gahcho Kue going forward - there's a lot of people not just working on construction but working on equipment delivery and assembly and those jobs are going to disappear."
Data is collected by Statistics Canada every month with territory-specific data compiled and released by the NWT bureau of statistics.
The national employment rate hovered around 60 per cent with the Yukon and Alberta trailing the NWT for the top spot at 67 and 66.6 per cent respectively.
Although unemployment had been steadily increasing since 2015, peaking at 9.4 per cent in January, it has gone down significantly to 7.4 per cent or 1,800 people. This is below the March 2015 rate of 8.1 and the national rate of 7.6 and includes those without jobs who are actively looking and available for work
Over the past year the employment and unemployment rates have seemed to both be increasing, leaving some scratching their heads. Bradshaw says this is because employment considers the total labour force - including those who do not live in the NWT.
"The troublesome part of the unemployment rate is that it's reflective of permanent residents whereas the employment rate probably isn't," he said.
In March it was estimated there were 22,400 people working in the NWT - an increase of 700 people from the previous year. Likewise, there were 19,500 full-time employees, relatively unchanged from 2015, while the number of part-time employees has risen from 2,400 to 2,900 over the last year.
Employment peaked in the NWT in 2007 and again in 2013 at around 23,300 workers prior to each of the decade's commodity market crashes. Bradshaw says because the NWT is such a small resource-based economy, even minor fluctuations in the global market can have a profound impact.
"We have to expand the economy and that's very difficult to do in a market the size of the NWT," he said. "There just isn't a market here."
Bradshaw says the territory's population statistics have also been misrepresented and should be taken into consideration when painting a picture of the economic climate.
"We've had over 4,000 permanent residents move out in the last eight years," he said. "The outmigration rate has been offset by births here in the NWT and those births are veiled and somewhat misleading because they're happening largely with people who weren't in the workforce to begin with."
When the majority of the people who were contributing to the local economy leave and are replaced with fly-in workers who take away from businesses - it becomes problematic Bradshaw explained.
In 2015, approximately 6,500 of the people working in the NWT were fly-in employees - about 25 per cent.
Ultimately he says residents shouldn't put too much store in the monthly numbers because the situation could be drastically different six months from now and the overall climate will take a number of years to rebound.
"I don't think we should get too worked up about minor up-ticks in employment or unemployment," he said. "I think we need to look at the larger picture and ask ourselves honestly what's going to have a positive and significant effect on jobs and employment in the NWT."
Drew Williams, spokesperson for the GNWT Department of Industry, Tourism and Investment said the government does not generate the statistics and therefore is not in a position to comment on the survey's findings; however, the data seems to coincide with past trends.
"Employment usually increases in February and March," he said. "We expect it to grow for the foreseeable future and hope the trend continues. It definitely will help with our ability to attract people to the territory - so that's a good thing."
The latest forecast from the Conference Board of Canada predicts employment will increase to 22,700 by 2020 and continue to grow by one per cent annually until 2030 with unemployment slated to decrease to 6.7 per cent.
Bradshaw says he is also sceptical of those predictions as they hinge on a number of large-scale mining projects coming online, adding people need to start speaking more frankly about what the situation is in the NWT and what the possibilities are going forward.
"When all of those true factors in the economy coincide I think you're going to see a more realistic picture of what's happening and what's not happening here," he said. "All of this data is going to cause a perfect storm down the road."