Last job gains like this were 40 years ago
Not only did the quantity of work expand in 2019, but data show the quality also saw a boost
Last week, Statistics Canada released its monthly jobs report for December. Media headlines tend to focus on the month-tomonth changes in employment and unemployment. December featured a decent gain of 35,000 jobs, all full time — reversing losses recorded in November.
But these monthly fluctuations are notoriously volatile and must be interpreted with caution. Since this report was the last for 2019, we can now take stock of Canada’s labour market performance for the year as a whole. The news was undeniably positive: Not only did the quantity of employment expand strongly, there were also encouraging signs of longneeded improvements in the quality of work.
On the quantity side, average employment rose by 390,000 jobs in 2019, compared to 2018. That’s the biggest annual increment since 1979.
The unemployment rate averaged 5.7 per cent for the year, the lowest since Statistics Canada began gathering this data in 1976.
But I am more excited about evidence of a broad improvement in the quality of work.
By several indicators, jobs in Canada became better last year: more full-time jobs, less temporary work, growing unionization and rising wages. These improvements in job quality, if sustained, will underpin future improvement in income equality and social well-being.
Consider just some of these indicators.
Almost three-quarters of new jobs in 2019 were full-time positions — and all new jobs since April have been full-time. After years of growing part-time work (generally less secure, with lower wages), the share of full-time jobs is now rebounding;
Temporary employment also decreased, on average, in 2019. On a net basis, therefore, all the new jobs last year were permanent — with better pay and more security;
Self-employment didn’t change in 2019 despite overall employment growth. Hence the share of self-employment declined (to just over 15 per cent), and is now at its lowest since 2002. On average, selfemployment offers lower pay, worse productivity and less security than other jobs. With more chance of finding a decent paid job, Canadian workers are now less interested in being their “own boss”;
Public sector agencies added a solid 55,000 net jobs in 2019, for a total of 300,000 new positions over the last five years. Here, too, wages and job security tend to be somewhat better. The public sector now engages more than one in five of all Canadian employees;
Unionized employment grew by 130,000 positions in 2019: the biggest jump in union jobs since the turn of the century. The share of paid employees (not counting self-employed) in a union grew slightly, to 30.2 per cent.
The combination of strong job-creation with improvements in job security is supporting a welcome pick-up in wage growth.
Average hourly wages rose 3.4 per cent in 2019. That’s the best since 2007 (just before the global financial crisis hit). And wage growth accelerated as the year went on, surpassing four per cent over the last half of the year.
Average incomes for Canadian workers are therefore growing significantly faster than inflation, generating an improvement in real purchasing power. After many years of relatively stagnant real incomes, this is welcome news indeed.
Sustained low unemployment and strong employment growth help to explain these improvements in the quality of jobs: Employers must sweeten the wages and conditions they offer in order to attract and retain workers. But active government policy has also been important: including higher minimum wages in several provinces, expanded public services (sparking more public sector hiring) and incremental measures (for example, by the federal government) to facilitate unionization and collective bargaining.
Nothing is more crucial to the well-being of society than ensuring that the vast majority of willing workers are able to find and keep decent work. Of course, Canadian economic and social cohesion has been undermined by decades of growing inequality and fragmentation. These recent improvements in the quantity and quality of work won’t be enough to fix those longer-term challenges.
But they do create an economic foundation for social progress that is overdue and promising. A commitment to sustained strong job-creation (as the top priority of macroeconomic and fiscal policy) and stronger policies to support job quality (like minimum wages and collective bargaining) will ensure that those improvements continue.