Job-vacancy rate plunges as Tories drop Kijiji data

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The Conservative government has quietly adjusted its labour data to ignore job postings from Kijiji and similar websites, a change that essentially erases the dire warnings of labour shortages that Ottawa has used as justification for expanding the controversial temporary foreign worker program.

With these sites removed from the source data, the government's latest labour market report points to a job vacancy rate of 1.5 per cent, which is dramatically less than the 4 per cent vacancy rate Finance Canada warned of on budget day.

The government has repeatedly pointed to concerns over skills shortages as the reasoning for a number of its decisions, including expansion of the temporary foreign worker program and tightening the eligibility rules for employment insurance.

The temporary foreign worker program has come under intense criticism after it was revealed that businesses were bringing in workers while Canadians said they were being denied work.

(What is the temporary foreign worker program? Read The Globe's easy explanation)

Employment Minister Jason Kenney has imposed a moratorium on the program for the food-service industry and has previously vowed to review the entire program.

Mr. Kenney has said lately that while there is not clear evidence of a national skills shortage, there is a need for specific skills in specific regions. Many employer groups insist shortages are real and that the program is desperately needed.

The Globe and Mail reported in March that a Finance Canada Jobs Report released with the Feb. 11 budget contained claims of rising job shortages that were largely based on a problematic software program.

The Parliamentary Budget Office discovered that while the software by Wanted Analytics scans all online job boards, the growth in job postings was almost entirely due to a rise in postings on the classified site Kijiji. The site allows the same job to be posted in numerous sections, which inflated the job numbers.

The job vacancy rate is arrived at by calculating the number of online job postings divided by labour demand, which is total job postings plus occupied positions.

A new labour market report released last week by Employment and Social Development Canada (ESDC) uses Wanted Analytics data, but removes numbers from Kijiji and other sites that allow jobs to be posted anonymously.

The department's Employment Insurance, Monitoring and Assessment Report is a detailed annual assessment of Canada's labour market and the federal government's EI policies. The report does not list a vacancy rate, but does say that after anonymous postings were removed, the Wanted Analytics data set added up to 276,525 jobs. From that figure, it is possible to calculate the vacancy rate of 1.5 per cent for the 2012-13 fiscal year.

Mostafa Askari, the assistant parliamentary budget officer, said the changes underscore the fact that Canada lacks reliable job data. As a result, it is impossible to know whether there is a justification for policy measures such as the temporary foreign worker program.

"There's isn't really any good data out there. Online postings are online postings. How well can you clean those up?" he asked, pointing out the need to avoid double counting jobs or counting jobs that have been filled but were not taken offline. He said the solution would be to give Statistics Canada more money to improve its research on job vacancies, which are based on surveys of employers.

"I think Statscan can definitely provide better data if they have the means to," he said. "I assume they are obviously under budget constraints as well. So they have to put that as a priority but they won't do it unless there's pressure on them to provide that kind of information."

Finance Canada had claimed in its initial February report that "the number of online postings from Wanted Analytics provides highly accurate job vacancy rates."

It is not clear, however, that Finance Canada agrees with ESDC that removing Kijiji data entirely is the right approach.

"A significant number of legitimate job postings appear on the Kijiji and similar sites, and these sites are growing in popularity," said Finance Canada spokesperson Stephanie Rubec on Wednesday in an e-mailed statement. "The Department of Finance is working with Wanted Analytics and is consulting with ESDC and Statistics Canada to examine ways to improve the measure of job vacancy presented in Budget 2014.

"Estimates of vacancy rates will vary depending on the measures of vacancy used. Given the uncertainty with respect to the level of the vacancy rate, the Department of Finance focuses on the evolution of the vacancy rate over time when assessing labour market conditions."