Justin Trudeau and Erin O’Toole are promising 1 million jobs. But both are ignoring a bigger challenge

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This article was published 11/07/2021 (1300 days ago), so information in it may no longer be current.

The Conservatives and the Liberals are both promising a million post-pandemic jobs — but the similarities end there.

Justin Trudeau made the commitment last September in the throne speech and subsequent fiscal updates.

Not to be outdone, Conservative Leader Erin O’Toole has incorporated a parallel pledge into his latest social-media push.

“We will recover 1 million jobs in one year. We’ve lost that number in this pandemic and it’s our mission to get Canadians back to work and paycheques back in your pockets,” he tweets.

Chances are, either leader would be able to come pretty close to keeping their vague promises without too much of an effort, depending on what you mean by a million jobs. But it’s looking like they’d take different routes to get there — approaches that could have a lasting impact on the nature of Canada’s economy.

Statistics Canada showed Friday that the roller-coaster job market rebounded again in June as parts of the country started opening up after the third wave of COVID-19 settled down.

On the positive side: Employment rose by 231,000 positions — almost making up for the losses in the two previous months of pandemic lockdown. The unemployment rate fell to 7.8 per cent in June, down from 8.2 per cent a month earlier. More people joined the workforce.

Young people, who have felt the brunt of the pandemic recession more than most, saw huge gains. Student employment has actually recovered. Same goes for new immigrants and Indigenous workers. Cities are doing well, economists at National Bank Financial point out: Montreal and Vancouver have recovered, and Toronto is almost there.

Economists say the numbers show that Canada’s job market is fairly resilient, able to bounce back readily when the restrictions recede. They project more gains this month as Ontario opens up even further.

But the job gains were mainly because of new part-time positions. Full-time employment hardly changed, after two months of steep losses.

Total employment is 340,000 positions lower now than it was before the pandemic started — and that’s the number both the Liberals and Conservatives zero in on when they talk about a million jobs. We are 340,000 positions short of that goal for now.

But in fact, because our population has grown, we are actually 550,000 positions short of full recovery, Statistics Canada says.

Plus, there are still almost a million people who are still suffering the employment consequences of the pandemic. StatCan groups together the total number of people who are unemployed, those who are working fewer hours than they’d hoped, those who are on temporary layoff and those who are out of the workforce altogether but still want to find work. And by that measure — called the labour underutilization rate — there are 907,000 more people being squeezed right now than there were before the pandemic hit.

That’s down dramatically from the nearly 5 million sidelined at the peak of the shutdowns in April 2020. But clearly, we still have quite a ways to go.

The Conservative fix was spelled out on Friday by jobs critic Pierre Poilievre. He blamed the employment shortfall on Liberal overspending, red tape and high taxes. And he promised that a Conservative government would “unleash the free-enterprise era” which would cut taxes to reward work and investment, issue building permits quickly, encourage free trade amongst the provinces, remove red tape and “stop printing money” to halt inflationary pressure.

It’s unclear how a Conservative government would intervene with the Bank of Canada’s mandate, but Poilievre has accused the central bank repeatedly of lacking integrity, and deliberately stoking inflation at the behest of Liberals.

The Liberals, on the other hand, don’t put much of an emphasis on free enterprise, although they’re not against it. Instead, they talk a lot about supporting workplaces and workers through the pandemic by extending wage subsidies and easing Employment Insurance provisions until the economy improves. They point to a hiring subsidy just introduced in the budget. And they point to longer-term measures to draw women into the workforce by massively subsidizing daycare, and to bolster green jobs by supporting transition to low-carbon production.

It’s a fairly traditional approach by both parties. The Conservatives would see lower taxes and less government interference in the operations of business. The Liberals are using subsidies, regulation and government support to see us through.

What neither of them seem to be addressing thoroughly are the permanent changes to the economy and the workforce that the pandemic is driving — changes in global trading patterns, in production methods, in commuting, in the way we work every day.

We don’t know yet whether downtown cores will spring back to life, but work-from-home will likely be far more prevalent post-pandemic than before. And we have barely begun to grapple with the employment implications of automation. Companies, their clients and their customers have moved en masse into a fully digital world, and we have only begun to explore what that means for jobs long term.

Globalization is in flux, with companies shortening their supply chains and countries attempting to onshore production. For an open economy like Canada, there will be churn.

We can take heart in the signs of resilience, but we need policy to catch up.

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Heather Scoffield is the Star’s Ottawa bureau chief and an economics columnist. Follow her on Twitter: @hscoffield