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Does Canada really have the best record on job creation in the G7?

OTTAWA - Government House Leader Peter Van Loan is using the return of Parliament to boast about the Conservatives' economic track record — but OECD figures cast a small doubt over his claim that Canada tops the G7 in job creation.

"We have the strongest job-creation record in the G7, with the creation of over one million net new jobs since the recession," he said Monday.

Finance Minister Jim Flaherty also mentioned the million-job figure during the first question period since MPs returned from their winter break.

"Our government is focused on the creation of jobs," he said. "In fact, over one million net new jobs have been created in Canada since July 2009, since the end of the recession."

The million-jobs figure is one the Harper government often mentions when talking up its economic prowess. Same with the claim about leading the G7 in creating jobs.

But are those statements accurate? Yes to the first one and "almost" to the second, depending on how you look at it.

There doesn't seem to be any dispute about the million-jobs figure. When the recession began in October 2008, Statistics Canada figures show that 17,175,100 people had jobs.

That number fell to a low of 16,743,800 in July 2009 before starting to rebound.

The most recent figures from Statistics Canada showed that in December 2013, 17,769,600 people had jobs.

That's an increase of 1,025,800 jobs since the recession's low-point in July 2009.

Using those numbers, Van Loan and Flaherty indeed appear to be correct in saying that more than one million net new jobs have been created since the depth of the recession in July 2009.

"Yes, we've created a million jobs in the country. Pat ourselves on the back," said BMO Capital Markets senior economist Michael Gregory.

"But has Canada done the best in the G7? Possibly. Depends when you make the comparison."

This is where things get a bit tricky. The Canadian Press analyzed Organisation for Economic Co-operation and Development employment data, then ran its findings and methodology by two senior economists, Gregory and Pedro Antunes of the Conference Board of Canada.

First, some caveats.

The OECD presents its employment data by quarters, not months. So for the purposes of our comparison, we used the third quarter of 2009 — the recession's low point — and compared it to the latest quarter in which all G7 countries reported.

That brings us to our second caveat. The OECD has employment data for the fourth quarter of 2013 from only Canada and the United States. The rest of the G7 only reported up to the third quarter of 2013. So all calculations were done using the 2013 third-quarter data, despite Canada and the U.S. having more recent numbers.

So, which country had the best percentage increase in the number of people working? Germany did.

According to the OECD data, which can be found at http://stats.oecd.org, there were 38,205,190 people working in Germany in the third quarter of 2009. That number grew to 40,499,230 in the third quarter of 2013 — an increase of six per cent.

Canada came in second, with an increase of 5.81 per cent between the third quarter of 2009 and the third quarter of 2013.

They were followed by the United Kingdom, the United States, France, Japan and Italy.

However, it's possible the government is simply using a different data set or reference points when it claims to be the best job creator in the G7.

"The stats can tell a story one way or another," Antunes said.

"But I think essentially the truth is, we've done relatively well, I think, no matter how you slice it versus most of the OECD or the G7."

Van Loan and Flaherty didn't mention the employment rate, which many economists believe is a better indicator of the health of the labour market than simply the number of jobs created.

That's because the employment rate takes into account the fact that the population is growing in many countries all the time. It measures the proportion of the working age population that actually has a job.

According to the OECD, Canada comes out on top if you look at the employment rate of everyone over the age of 15.

Using that metric, Canada's employment rate was 61.8 per cent in the third quarter of 2013. The United States came in second with an employment rate of 58.6 per cent.

But you get a different picture if you only look at the employment rate of people between the ages of 15 and 64. Many people aim to retire by age 65.

Germany's employment rate for people between 15 and 64 in the third quarter of 2013 was slightly better than Canada's during the same period.

The employment rate for 15-to-64-year-olds in Germany was 73.4 per cent — good enough to place highest in the G7 — compared to 72.4 per cent in Canada.

Still, whether Canada is No. 1 or No. 2, the economists agree the country has done well.

"At the end of the day, though, Canada is clearly near the top," Gregory said. "Whether we're No. 1 or not, we can quibble."

Follow @steve_rennie on Twitter

The Canadian Press


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