Unreliable jobs data cloud labour picture

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Much mockery was made last week over revelations the federal government relies, in part, on Kijiji ads to help calculate job vacancies. But the debate over the degree to which Canada is experiencing labour shortages – and just how many job openings are going unfilled – highlights a serious issue: This country's jobs picture is still very fuzzy.

"We have really great information about the supply side of the labour market" or job-seekers from detailed reports such as the monthly labour force survey, said Frances Woolley, economics professor at Carleton University. However, "much less information is collected about the employer side of the job market."

Statistics Canada will release its latest version of the labour force survey on Friday. Economists are expecting about 25,000 new jobs with the unemployment rate staying at 7 per cent. Hiring has slowed to an average of 3,400 a month over the past half-year.

While there's general consensus that Canada is not seeing a national labour shortage, that could change in the coming years, and already, some provinces such as Saskatchewan are having real challenges filling positions. And right now, data are all over the map – the Finance Department's calculations, based partly on Kijiji ads, show rising vacancies while other measures, from Statistics Canada to the Bank of Canada, show vacancies either holding steady or declining.

Labour market indicators help shape public policy on everything from the number of temporary foreign workers admitted to where investments are made in skills training. A clear picture of vacancies can guide policies that might encourage some workers to move from one province to another. It can also help students decide which career path to follow or older workers who want to switch from one occupation into another.

A muddy picture spells bad – and costly – decisions, leading to wasted taxpayer dollars and less efficient use of the country's work force, which in turn weighs on economic growth. Already, jobless rates and underemployment rates for several groups – such as youth, immigrants and aboriginal people – are elevated, and so is the proportion of long-term unemployed; a better picture of labour-market demand would help boost both their outcomes.

Federal Employment Minister Jason Kenney sees room for improvement. He defended his government's use of Kijiji last week, but acknowledged there are concerns with the data given that many of those job ads may be duplicated, or listed on other sites. "Everyone who's dealing with this debate should have a little bit of humility and admit none of us knows exactly what's going on in the labour market of today," he told CTV's Power Play.

The lack of solid information has long frustrated economist Don Drummond. He was part of a labour market information panel that made dozens of recommendations on improvements in 2009. Mr. Kenney said last week, citing Employment and Social Development Canada, that two thirds of those recommendations have been, or "are being" implemented. ESDC, however, did not immediately reply to requests for comment on which measures are pending.

Several changes could paint a better picture of the jobs market, Mr. Drummond said. First, have one entity, such as Statistics Canada or ESDC, take responsibility for providing this information in Canada, instead of the current hodgepodge.

Second, improve two surveys: Statscan's job vacancy report, by adding more detail at the sub-provincial and occupational level, and the survey of college and university graduates, so that young people know before they enroll what the expected rate of return for every field of study is. All information should be transparent and accessible to the public.

Boosting sample sizes of both the labour force and job vacancy surveys would make the data less volatile and easier to analyze, said Benjamin Tal, deputy chief economist at CIBC World Markets. If that's too expensive, another way to measure the skills or jobs mismatches is to work more closely with industry associations and conduct regular, in-depth surveys with them, he said.

Canada should also look to other countries, such as Australia, said Jim Stanford, economist at Unifor. Australia produces more detailed job vacancy surveys, and has a workforce agency that produces reports on skills and skills shortages in specific sectors. He also said Canada should do more analysis on growth projections of various occupations, and create a centralized spot for advertising vacancies. Data could also be better shared between industry, government analysts and post-secondary institutions about enrolment flows.