Northern Economist 2.0

Showing posts with label employment. Show all posts
Showing posts with label employment. Show all posts

Friday, 14 April 2017

Economic News Around the North: April 14th Edition

Well, we are heading into the Easter weekend.  Spring is a time of rebirth and who knows, after two decades of slow growth, perhaps the north's economy will finally resurrect itself in the third. On the other hand, Good Friday this year coincides with the anniversary of the sinking of the Titanic. Here are some of the stories that I felt were of economic significance for northern Ontario over the last week or so. 

Gas prices soar in city. TbNewswatch, April 13th, 2017.

Well the price of gas has shot up again, just in time for a long weekend but it is a phenomenon that hit the entire province.  If you want some insight on Canadian gasoline prices in general, there is an old post I did on gas prices on Worthwhile Canadian Initiative that also attracted quite a few comments that provided some interesting points.  The long and short, in my opinion, prices are higher because the companies can get away with charging more.  Price differentials across regions have converged over time and this may signify greater market power on the part of gas companies.

Alexander Henry one step closer to returning home. CBCThunderBay. April 11th, 2017.

There seems to be some support for relocating the former icebreaker Alexander Henry from Kingston to Thunder Bay's waterfront.  In principle, this will be an excellent addition to the waterfront as it can serve as the core exhibit for a transportation museum.  This might mesh in nicely with the plans for a grain museum which is being worked on by Nancy Perozzo's group.  As well, there are plans to relocate the Thunder Bay Art Gallery to the waterfront also.  When one looks at the restaurant development in the Waterfront area combined with the location of Magnus Theatre and the long-term plans to place an Events Centre in the area, one can finally see a substantial entertainment district coming into shape.  The one caveat - customers and money.  I know, presenting caveats and pros and cons does not go over well with local movers and shakers who prefer expressions of cheerful mindless optimism when it comes to economic development in the north but Thunder Bay's tax base is under stress and the city's population base and market size are limited.  Can Thunder Bay become a tourism destination with its central Canadian waterfront marked as "The Mid-Coast?"  Who really knows?

Thunder Bay taxi bylaw causes concern for council, taxi companies.  CBCThunderBay. April 11th, 2017.

Getting a taxi in Thunder Bay is a ordeal.  If you ever needed a taxi in the middle of a weekday afternoon on short notice, forget it as they are all engaged in "school runs". This is another example of how dependent even the private sector in northern Ontario is on public sector spending.  I won't even get into trying to get a taxi at the airport or late on a weekend after an evening out or the price.  Supply constraints have been very profitable for Thunder Bay taxi companies and by taking five years to re-write the taxi bylaws, Thunder Bay City Council has been aiding and abetting a cozy oligopoly.

Other Thunder Bay economic news:

First salty arrives in port. TbNewswatch. April 8th, 2017.

Grain shipments make for busy March at Thunder Bay port. CBCThunderBay. April 5, 2017.

Well, this has all been rather Thunder Bay centric to this point.  In other news:

Sudbury loses 400 jobs in March. SudburyStar.com. April 7th, 2017.

Yet, things are going to get better as the Canada Revenue Agency has announced it is adding 543 full-time jobs to the Sudbury tax centre.

Council sets criteria for location of new events centre. CBCNewsSudbury. April 12th, 2017.

Sudbury appears to be moving forward at a rapid clip with a site selection team in place.  However, four of the five members of the selection team appear to be directly related to Sudbury's municipal government with a consultant from PWC as the fifth.  It would have been useful from an optics point of view to have a more arm's length group of experts.  Apparently the criteria for site selection includes cost, economic impact and parking.  In the end, it is all about weighting the criteria and if parking carries the biggest weight, then one should expect the greenfield site outside of the downtown as the final destination.

Here are some interesting items from North Bay.

Casinos siphoned millions from Sudbury, Brantford and Thunder Bay in 2014-15. Nuggest.ca. April 12th, 2017.

And in another tourism infrastructure related story. ..

North Bay city council votes to keep Dionne house. CBCNewsSudbury. April 5th, 2017.

The only surprise here is that the City of North Bay was actually considering giving the historically significant house to a group that was going to move it to a "pioneer village" project 70 miles south of North Bay.  Why stop there, maybe they should consider moving it to Thunder Bay's waterfront - a nice plot of land between the yet to be completed hotel and the new condos?  

And in the relentless and ongoing efforts to attract new business activity via marketing techniques....

Invest Sault Ste. Marie website launched. SaultOnline. April 6th, 2017.

Sault needs to find gaming 'sweet spot'. SaultStar.com. April 9th, 2017.

And in Timmins, this story about the mining sector.

Gold is the new economic driver for Ontario mining. TimminsPress.com. April 12th, 2017.

There were a number of interesting comments made. I was particularly intrigued by the Red Tape Challenge - an Ontario government consultation program for mining asking for input on what could be done to make the mining industry work better with government.   Dealing with red tape by engaging in yet more consultation seems like a typically Ontario way to address questions of efficiency and regulatory barriers.  However, with respect to gold as a driver, according to the president of the Ontario Mining Association:
What has changed in Ontario in the last 10 years is that gold is now a larger contributor than nickel and copper. That’s new and it is a combination of the price of the commodities and the number of new discoveries of gold and the new investments around gold,” said Hodgson.

Have a nice long weekend.




Tuesday, 11 April 2017

How Many Jobs Have Been Created in Thunder Bay?

One of Thunder Bay's Members of Parliament and currently Minister of Employment, Workforce Development and Labour - Patty Hajdu - asserted in a letter to the Chronicle-Journal this morning that "In the last eight months alone, the Canadian economy has created more than a quarter-million full-time jobs. In fact, 1,600 jobs new jobs have been created here in Thunder Bay since we were elected."  Needless to say, this piqued my curiosity and so I went off to Statistics Canada to see what Thunder Bay's total employment numbers have looked like since October of 2015 - the year the Trudeau Liberals  took office.

The results are provided in Figure 1, and are monthly seasonally un-adjusted total employment (three month moving average) for the Thunder Bay CMA.  The numbers show rising monthly employment from October 2015 to August 2016 and a decline since.  In October of 2015, total employment in Thunder Bay was 59,100 jobs and the total employed reached a peak of 61,300 by August of 2016.  This represents an increase of 2,200 jobs.  However, between August of 2016 and March of 2017, employment then declines from 61,300 to 59,300 - a drop of 2,000 jobs.  So, based on these numbers, from October of 2015 to March of 2017 Thunder Bay goes from 59,100 to 59,300 jobs for an increase of 200 jobs.



Of course, while these numbers are three month moving averages, they are not adjusted for seasonality. If we go from October 2015 to October 2016, employment grows from 59,100 to 60,800 for an increase of 1,700 jobs.  If we go from March 2016 to March 2017, we see total employment grow from 59,500 to 59,300 jobs - a decline of 200 jobs.  Based on Figure 1, Thunder Bay may have indeed seen the creation of 1,600 new jobs since the election of the Trudeau Liberal government but it also appears to have lost nearly as many jobs making for little in the addition of net new employment.
 

Tuesday, 4 April 2017

Evaluating Northern Ontario's Growth Plan-Part II: Employment Generation


This is the second in a series of posts in which I will present evidence in an attempt to evaluate the Growth Plan for Northern Ontario, which was released on March 4, 2011.  The 25-year plan was to guide provincial decision-making and investment in northern Ontario with the aim of strengthening the regional economy and its ultimate goal was to strengthen the economy of the North by:
  • Diversifying the region's traditional resource-based industries
  • Stimulating new investment and entrepreneurship
  • Nurturing new and emerging sectors with high growth potential.
While the provincial government did commit itself to the development of performance measures for ministry specific initiatives that supported the implementation of the plan, I will be using a broader set of indicators of overall economic performance that are supported by the availability of readily accessible public data. In this first post, I will be looking at employment.

Tuesday, 7 March 2017

The Ring of Fire: Waiting for Ignition


There was an exchange in Ontario’s Legislature yesterday between MPP Norm Miller and Minister of Northern Development & Mines Bill Mauro regarding whether or not the government would “finally take a leadership role that will make the Ring of Fire a reality in Ontario?”  The minister responded that mineral exploration activity in Ontario was climbing and progress was being made and more specifically asserted that: “there are three other mines under construction in the province. But they want to spend their time focusing on one. There’s one not too far from my home community of Thunder Bay called the New Gold project. Speaker, right now it’s under construction and 600 people are working on a construction site. When that mine is open for the next 10, 20 or 30 years of its life, there are going to be 450 people working in that mine.”

My belief is that any full-blown development of the Ring of Fire is many years away given the ongoing negotiations with First Nations, the immense cost of transportation infrastructure to access the Ring of Fire as well as the state of resource and commodity markets.  However, it is worth examining whether there has been some progress in northern Ontario’s resource sector particularly when it comes to employment generation.  Figures 1 and 2 present employment in northern Ontario’s resource extraction sector as measured by Statistics Canada series  v91415810 (Northeast) and v91415829 (Northwest) on employment in Forestry, Fishing, Mining, Quarrying, Oil and Gas presented monthly from 3rd month 2001 to 1st month 2017.  

 

The results in Figure 1 show that while there is some substantial fluctuation in resource extraction over time with some large upswings, when a linear trend is fitted to the data the long-term performance is quite flat.  Indeed, average monthly employment was 21,500 in 2001 and 21,867 in 2016 – actually a 1.7 percent increase.   

 

Figure 2 is more interesting because it separates the employment data up into northeast and northwest Ontario.  While the northeast has trended up over time, the northwest has trended down.  Average monthly resource extraction employment in the northeast was 12,470 in 2001 and 17,892 in 2016 – an increase of average monthly employment over time of about 44 percent.  Meanwhile, the northwest has seen average monthly employment in resource extraction fall from 9,030 in 2001 to 3,975 in 2016 – a decline of 56 percent. 

This is a remarkable difference in performance and likely represents the long-term impact of the forest sector crisis on the northwest – which was much more forestry intensive than the northeast – as well as the relative success of mining in the northeast relative to the northwest.  While the northwest is seeing mining activity, it has not yet been on a sufficiently large enough scale to be the employment generator it is touted to be.  I suppose we are still waiting for the Ring of Fire to be ignited.

Friday, 15 June 2012

Thunder Bay's Employment Surge

Data from Statistics Canada on Thunder Bay's unemployment rate, employment and labour force suggest that its economy is experiencing a rebound after quite a few years of slow performance.  The most recent unemployment rate in Thunder Bay for May 2012 came in at 5.7 percent, which is well below the national and Ontario unemployment rates.  Of course, one of the reasons our unemployment rate is so low is that the labour force has not been growing as fast as employment but the last twelve months suggest that employment has actually begun to grow faster than the labour force.

Figure 1 shows unemployment rates (seasonally adjusted) for Canada, Ontario, Thunder Bay and Greater Sudbury for the 2009 to 2012 period on the left and total employment (seasonally adjusted)  for Thunder Bay over the same period on the right.  As can be seen, the period from June 2011 to January 2012 saw robust increases in employment followed by a decline since.  Overall, employment levels in Thunder Bay are the highest that they have been in the last three years.

Figure 1


The second figure shows annualized growth rates (May to May) for 2010, 2011 and 2012.  Thunder Bay's labour force actually shrank in both 2010 and 2011 but it grew substantially in 2012 - along with employment.  Employment in 2012 grew by 5.3 percent while the labour force grew by 3.8 percent.  As a result,  the unemployment rate dropped below 7 percent in 2011 and in 2012 has fallen below 6 percent.  However, the total level of employment in May 2012 is 61,500 - which is still down from the high of 67,400 reached in March 2003 but up from a low of 57,400 as recently as June 2011.

Thunder Bay's economy appears to have begun to recover from the forest sector collapse but still has ground to go.  Moreover, its employment still seems to be subject to somewhat erratic fluctuations.  While June 2011 to January 2012 saw a period of sustained increases, employment has declined since then.  Thunder Bay is still very much an economy in transition.

Figure 2