Business·Analysis

Voting for a government that will create Canadian jobs: Don Pittis

With just over a week before the federal election, the latest job numbers will be the economic statistics most likely to stick in people's minds. However, Don Pittis writes, government plans to improve the Canadian job outlook must be visionary, not plodding and short-term.

Friday's job numbers may be the most important economic statistic of this long election campaign

Steve Jobs is watching. As Canada studies the last big economic statistic before the federal election, Don Pittis says plodding into the future is not enough to create quality employment. The Canadian economy needs a vision. (Reuters)

If the federal government's Economic Action Plan had lived up to its billing, Canada should be swimming in jobs right now.

In fact, Statistics Canada reported Friday morning the unemployment rate rose from 7 to 7.1 per cent in September on a modest gain of 12,000 jobs. Most of those jobs were part time, with 74,000 new part-time positions created during the month, offset by a loss of 62,000 full-time jobs.

As we study the last set of employment numbers before Canada's national election — and the last big economic indicator likely to stick in voters' minds — it is intriguing to consider what it takes for a government to create good jobs.

In this election campaign every party has promised to create jobs, especially jobs for youth. Boring promises are not enough. What we need is vision. 

The Harper strategy

A majority government with friends in business and handed a balanced budget by Liberal Paul Martin, the Conservatives had as much power to manage the economy as is possible under Canadian democracy.
Conservative Leader Stephen Harper speaks at Burlington's Laurel Steel earlier in the campaign. Each party will try to show that the latest employment numbers favour them in the upcoming election. (Reuters)

If their strategy had been the right one, we should be seeing the results right now. In other words, if the prime minister really can fulfil his promise of creating 1.3 million net new jobs in the next five years despite the commodities crash, voters might ask why he didn't do a better job during the past five.

That said, in a free-market economy it's not a simple matter to get entrepreneurs to start new ventures and spur private companies to hire more people. The only absolutely sure way for a government to create jobs in the short term is to go heavily into deficit and hire millions of government workers.

Governments are notoriously bad at micro-managing an economy. Using a strategy sometimes called "starve the beast," the Conservative methodology involves cutting back on government taxation and government spending as much as possible. Handing the money back to businesses and consumers is supposed to free the private sector to make efficient choices, boosting jobs.
An Economic Action Plan sign in Ontario in 2010. Stimulating the economy and creating jobs is one of a government's most challenging tasks. (Adrian Wyld/Canadian Press)

Handouts to individual companies and individual works projects (trumpeted on Economic Action Plan signs) are, by comparison, merely public relations. As a stimulus, tax cuts dwarf such contributions.

Whether the job-creation strategies offered by the other parties will work will only be tested if one of them wins.

Liberal Leader Justin Trudeau has promised to run a small deficit to increase infrastructure spending, creating jobs at the same time as getting rid of bottlenecks in such things as roads, bridges and ports that impede the private sector economy. The NDP has promised a slight rise in corporate taxes.

Neither strategy is likely radical enough to damage the economy, but that means it will have only a small impact on job creation.

In some ways, the most intriguing long-term job creation plan may be the one offered by the national party least likely to be elected. Elizabeth May's Greens want to launch a radical green transformation of the Canadian economy, taking a leap into expanded public transport, rail and climate-friendly energy. She also advocates free college tuition.

Seeking vision

May's plan is long range and it is visionary. Like the U.S. space program of the 1960s or the Portuguese kings who in the 1400s launched a plan to find a sea route to the spice islands, the one thing governments can do is inspire a whole nation.

It can be argued Harper's greatest success was his own vision: Canada as a private sector-led energy superpower. For a while it worked. In retrospect, the private sector, not as wise as Harper hoped, over-invested the entire economy into the single black hole of falling commodity prices.

Canada has the potential to be the northern Europe of North America. We have resources and educated brains waiting to be turned into jobs, and creating those long-term jobs is going to mean balancing government spending with real governing vision. 

Whoever leads us next must invest in infrastructure and education. They must open doors to robotics, revolutionary medicine and risk. They must force us to diversify and process at home. They must invest in research in a way that contributes to Canadian jobs, not jobs in the home countries of foreign corporate owners.

But job creation is not a short-term endeavour. Job creation cannot be separated from long-term economic success. In a world filled with competitors, plodding is not good enough. 

As the late Steve Jobs said, "Let's go invent tomorrow rather than worrying about what happened yesterday."

Whichever party wins the election in 10 days, it needs to think like a visionary if it wants to create jobs.


Follow Don on Twitter @don_pittis

​More analysis by Don Pittis

About the Author

Don Pittis

Business columnist

Don Pittis was a forest firefighter, and a ranger in Canada's High Arctic islands. After moving into journalism, he was principal business reporter for Radio Television Hong Kong before the handover to China. He has produced and reported for the CBC in Saskatchewan and Toronto and the BBC in London. He is currently senior producer at CBC's business unit.

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