Study finds Alberta’s employment growth numbers buoyed by government hirings
According to a study conducted by the Fraser Institute, a public policy think-tank, Alberta’s increase of roughly 33,000 jobs over the last four years masks the ongoing struggles within the private sector.
The Illusion of Alberta’s Job Recovery: Government vs. Private Sector Employment report, released Thursday morning, indicates that the private sector shed 46, 267 jobs between May of 2014 and July of 2018. The loss was offset by the creation of 78,733 new government jobs in Alberta at the municipal, provincial or federal level during the same time frame.
“There has been some job growth since the start of the recession which is great,” explained Steve Lafleur, senior policy analyst with the Fraser Institute. “The challenge is that there’s some underlying weaknesses being masked by the overall numbers.”
“When you are recovering from a recession, ideally what you want is robust private sector growth to return the economy back to where it was. That hasn’t happened to the extent that we would like to see.”
According to Lafleur, employment numbers in the private sector in Alberta are still below pre-recession numbers and optimism surrounding the increase in self-employment should be taken with a grain of salt. “Sometimes it’s people who legitimately are having a hard time getting hired and it’s what they do instead.”
Lafleur says hiring more people in the public sector can be sensible in many scenarios but it does not have to be done in a reckless manner.
“The reality is that the public sector is funded by taxes and we need to generate those taxes in order to pay for those things. If we don’t see strong private sector job growth, (generating tax dollars) gets harder and harder particularly when we’re running chronic deficits.”
Lafleur questions the decision to increase corporate taxes during an economic recovery.
The owners of Tom’s House of Pizza have faced several recessions during the business’ 55 years but they consider this to be the longest and deepest yet.
“We’ve had to reduce staffing, reduce hours and we closed one of our locations this past year,” said owner/operator John Windle. “We’re struggling and it seems that more and more, every year our costs are being compounded not only by the government – the provincial government, the federal government – but the city government.”
Windle says the staff has been cut from 50 employees to 40 and there has been a massive reduction in overtime hours for workers. “Myself and my wife fill in and my son, we do the extra work. We’ll grin and bear it and try and make sure that maybe we can get another 50 years.”
He believes that business owners are being unfairly targeted as a source of funds. “If we could just ease off on some of the costs that are coming down to the small business person then we could possibly increase our staffing. If we increase our staffing and all small businesses increase their staffing by, let’s say, five or six per cent, we’d have a lot more people out there spending money and that would bolster the economy and we’d all be making a little bit more money.”
Management at About Staffing, a staffing and recruitment agency, say, from their perspective, there is reason for optimism in the private sector.
“We’re finding that the private sector is really healthy and has been recovering for a year and a half or so,” said Chris Massie, About Staffing’s operations manager. “We’re getting busier and busier and that’s important to look at because we are a point of contact between the sector and the market. We have a lot of companies that we haven’t worked with before, or that we have, and they’re saying ‘Hey, the energy sector’s improving, the construction sector’s improving. We’re able now to invest in hiring the right people’.”
“We’re busier than we ever have been at least in this market.”
Massie says the agency has seen a gradual, steady increase and has reached the point where its advertising for walk-ins as they are not getting enough applicants through regular job postings.
“I think it’s important for society to take notice of what The Fraser Institute is saying, that a large measure of growth in the labour force has come from the provincial government,” said Massie. “(I wouldn’t say) that we’re in a terrible position because, right here today, I can tell you that we’re not. People are hiring. There are jobs available.”
With files from CTV’s Kathy Le