Canada's Job Quality at 8-Year High in 2007

Canada's economy created more high-paying jobs in 2007, boosting the quality of employment by the most since 1999 despite heavy layoffs in the manufacturing sector, a new study showed recently. The employment quality index created by CIBC World Markets jumped 2.8% in 2007, compared to the U.S., where the quality of employment fell 1.9%. The report author and senior economist at CIBC World Markets said with the index currently at its highest level in over 18 months, he expects the level of employment quality in Canada to remain elevated enough to support healthy income gains and further shield consumers from the chill coming from south of the border. The index reflects the ratio of full-time jobs to part-time jobs, self-employment vs paid employment and compensation packages in over 100 industry groups. A jump in employment in high-paying sectors like public administration, computer services and the oil and gas sector explained much of the improvement in the quality index last year, CIBC said. Despite signs of slowing economic growth, Canada's labor market continued to add jobs at a surprisingly fast rate last year. Economists took that as a sign of relative immunity to the U.S. slowdown. Challenged by a strong CN dollar and U.S. housing market crash, manufacturers shed 132,000 jobs last year. However, the economy generated 400,000 new high-paying jobs, an increase of 3.6% from the previous year, while employment in low-paying sectors fell 1.2%. The results support the Conservative government's argument that despite the pain in manufacturing, the rest of the economy is coping well with the tough times. In a year-end interview with Reuters, the Finance Minister said strong tax revenues proved to him that good-paying jobs were replacing the lost factory jobs. As a result, personal income had risen by about 6% year-over-year as of the 3rd-Q of 2007, said CIBC. The province of Alberta, home to vast oil reserves, led the pack for employment quality. Ontario and Quebec, where 75% of manufacturing is based, were poor performers. The premiers of those two provinces called on the fed government recently to earmark more cash in the next budget to help beleaguered manufacturers. CIBC predicts employment quality will deteriorate somewhat this year amid a rise in self-employment and part-time jobs.