Friday, January 9, 2015

Ontario Jobs Hare Beat Quebec Tortoise in 2014

(Updated 18 February 2016)
Statistics Canada data show that Ontario is back on top as the non-oil province with the strongest job growth in 2014 (12-month average compared to 2013). 

Yes, Alberta and Saskatchewan led the way again in 2014. The oil price was high for most of 2014. Ontario and the other non-oil provinces could not compete with Alberta and Saskatchewan in the 2014 job growth contest. Alberta, Saskatchewan and BC have been dominating job growth in Canada since 2000. But, 2014 may well mark the last hurrah for the western jobs boom until resource prices bounce back. 

Quebec lagged behind in 6th place among the 10 provinces. On an annual average basis, total jobs actually fell by 0.03% in Quebec between 2013 and 2014 vs. +0.8% growth in Ontario. Job growth was already lagging in Quebec when the Parti Quebecois government of Pauline Marois was defeated in April 2014. The incoming Couillard government may have then contributed to job stagnation with budget constraints imposed to meet the 2015-16 budget balance target.

The Quebec government will be in a much stronger position than Ontario to withstand the next recession. My hypothesis is that the Quebec jobs tortoise will catch up with and surpass the Ontario hare during the next economic cycle of recession and recovery. However, I can't predict whether Couillard's risk-averse approach to fiscal management will have paid off politically by the autumn of 2018 when both the Quebec and Ontario governments return to the polls.

GDP Growth 2014

Ontario's relatively strong employment performance in 2014 was consistent with relatively strong economic and income growth as measured by Gross Domestic Product (GDP). Ontario's real GDP (adjusted for changes in the prices of each province's products) growth of 2.7% in 2014 ranked 3rd among the provinces behind Alberta (4.8%) and BC (3.2%). Quebec ranked 6th with 1.5% real growth.

Alberta's years of strong GDP growth ended in 2014 and will not resume until the world oil price rebounds and/or Alberta goes through the painful transition to a post-oil future. 

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