Why Calgary's job market is likely worse than it appears
Amidst low-priced oil, Statistics Canada numbers not telling the full story
A funny thing has been going on with Calgary's job market over the past seven months: Since November, when the bottom fell out of oil prices, the city has added more than 15,000 jobs. The unemployment rate has risen, but according to Statistics Canada that's because more people are entering the local workforce.
- Wendy Giuffre, Wendly Ellen Inc.
The same phenomenon is not happening in Edmonton, where employment has dropped by 7,900 jobs over the same period.
Nor does it jibe with the last time energy prices dropped in 2008-2009 when, over a similar seven-month period, nearly 30,000 jobs were lost.
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It's tempting to say, "Great, everything is OK in Calgary. The job market is resilient." But that doesn't match the feeling on the ground, the anxiety about job security, the near constant chatter of layoffs and restructuring, of contractors without contracts.
On the ground
"All anyone has to do is drive downtown in what used to be rush hour and tell me there haven't been job losses," said Wendy Giuffre, a human resources specialist with Wendy Ellen, a company that specializes in recruitment and downsizing.
"I have about 60 per cent energy-related clients. We are still busy in letting people go, busier than we've ever been in that area.
"It's five here, four here, six here, intermittent numbers. So to me it's not stopping."
Giuffre suggests that layoffs are not being reflected in the official numbers because Calgary relies on an unusually large contractor workforce, who identify as self-employed. So even if they lose a contract, they would continue to be self-employed, just not earning as much.
She is also seeing shortened work weeks.
"We have some clients who are saying if we can only give you 20 hours, work 20 hours. It's quasi-voluntary right now, but there's nowhere to turn to for jobs, so people are taking 20 hours."
Problems with StatsCan numbers?
The labour market survey that Statistics Canada releases every month is based on a telephone survey across the country. Respondents are asked whether they worked the week before and how much they worked, along with a number of other questions.
Since the municipal numbers are based on a relatively small sample, they are subject to sampling errors.
"So, once you get down to the municipal level, you're only talking about a few hundred people being surveyed," said Mike Moffatt, an assistant professor of economics at Western University.
"It almost acts like a political poll, where you could have a single poll that's a bit of an outlier because they talked to the wrong people."
Moffatt said that, over the early spring, job data for southwestern Ontario showed the region was having worse months than during the recession.
He isn't sure if there has always been a problem with Statistic Canada's local numbers, but there's more scrutiny on the agency after last summer when it had a computer problem and had to retract and correct its job numbers for July.
Statistics Canada is clear that the employment numbers aren't going to be precise, subject as they are to sampling errors. To smooth out the results, the municipal numbers are based on a three-month moving average.
Losses still to come
The other possibility is that there is a time lag at play. The Bank of Montreal estimated that 25,000 jobs had been lost in the natural resources industry since the fall. That includes, but is not exclusively, energy jobs.
"We've seen a lot of losses directly in the oil patch," said Robert Kavcic, an economist with BMO. "But not a lot outside the energy sector."
Kavcic says professionals who support the energy sector are likely to be hit soon and we'll see that in the data in the coming months.
"It's coming," said Kavcic.
The next labour market survey is due Friday morning.