ECONOMY IS UP, YET MANUFACTURING REMAINS TOUGH FIX
July was a good month for employment in Ontario in general, yet another cruddy one for manufacturing.
“The economy has legs. It’s always nice to talk about good months when they come,” said Brad Duguid, minister of economic development, giving the customary remarks after the monthly numbers came out Friday. Ontario added 26,000 jobs in July, according to Statistics Canada, and most of those jobs were full-time.
“It’s only fair now to acknowledge that this Liberal government has managed the economy extremely well and we’ve done it in challenging times,” the minister said contentedly.
A wicked recession; debt crises in Europe and fracturing in its political union; the rise of Trumpism. Yet here we are with nearly 729,000 net new jobs since the depths of the worst recession since the Great Depression.
Which is undeniably good. But for people who lost industrial jobs in the recession of 2008 and 2009, it won’t feel so great, and they get to vote, too.
Ten years ago, in July 2007, Ontario had 952,000 people employed in manufacturing. Then came a drawn-out cataclysm, the loss of more than 200,000 of those jobs over two years before the sector’s toes touched bottom in June 2009. By then, 742,000 people worked in manufacturing. Whole towns with one or two major industrial employers saw their economic foundations collapse.
It was horrible. It isn’t really any better now.
Manufacturing employment in Ontario has ticked up and down in the eight years since, but it’s never exceeded 800,000 again. It’s hung mostly around the 770,000 mark, pretty much where the count was in July, even as the population has gradually increased.
The fine details are a bit different outside Ontario but the basic shape of things is the same. Take Ontario out of the national picture and Statistics Canada says around 975,000 other Canadians are employed in manufacturing, a number that has hardly budged in five years. The manufacturing decline from a high of 1.075 million jobs went on for a little longer outside Ontario, then reversed itself slightly, then stalled. So, two things. First, the idea that manufacturing jobs are leaving Ontario in an ongoing cascade, pushed out by taxes, energy prices and overregulation, is bogus. Yes, factories close. Sometimes they move, sometimes they just go bust. That’s capitalism.
But our manufacturing decline is not continuing and Ontario is not uniquely weak in Canada. Or in the world, for that matter: The United States has lost manufacturing jobs. Germany has lost manufacturing jobs. They expect to continue losing them, particularly to automation — so it’s not that the employers are leaving, it’s that the jobs are vanishing entirely as companies chase efficiency and profit. This is happening everywhere.
But, second, the idea that the rising tide in Ontario’s economy is lifting everyone’s boat is also false. Ontario’s economy is bigger and employs more people now than it did in 2007, yet all the growth has been in services rather than in making goods.
The sectors that have added a lot of jobs are “professional, scientific and technical services;” finance, insurance and real estate; and health care and social assistance. Health care and social assistance are driven by government spending so they’re not exactly economic generators, but we need them all the same.
Mostly, those are good jobs, the kind of jobs you hope your kids grow up to do. Indoor work with no heavy lifting, for decent money. Those all have hundreds of thousands more people employed in them now than they did before the recession, let alone during the worst of it.
An unemployed sawmill worker from North Bay, however, is not easily going to shift into scientific research in Waterloo.
The Liberals’ move has been to reinforce social services and promise things like pharmacare, which make unemployment less devastating and uncertain employment less anxiety-inducing. They’ve also subsidized employers to add jobs, especially in research, high-tech and advanced manufacturing. Though, judging by the numbers, that’s helped hold the line at best.
The opposition Tories’ answer is to promise cheaper electricity (without a plan to get it), a rollback of greenhouse-gas restrictions, and less regulation generally. All of which is based on the idea Ontario’s manufacturing decline is unusual and the result of specific government decisions and if we just undo them, the good life will pop back into place. But that hasn’t been the case anywhere else.
Not one province in Canada has more manufacturing jobs now than it did 10 years ago. There’s no model for us to copy. Nobody wants to make the argument that less manufacturing is OK in Ontario, yet nobody has a convincing plan for restoring it.
With an election coming, now would be the time for the major parties to go with one or the other.