Brock professor responds to Niagara’s high unemployment rate

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Niagara is again above the provincial unemployment average, according to data recently released by Statistics Canada. Their seasonally adjusted labour force characteristics show that Ontario closed out 2017 with a 5.5 per cent unemployment rate, which is 0.2 per cent lower than the national average unemployment rate of 5.7 per cent.

The Niagara Region did not fare as well as many other regions in Ontario. According to Statistics Canada’s Labour Force Survey, the St. Catharines-Niagara region unemployment rate in December was at 6.7 per cent. This is a 0.3 per cent drop from November, but still 1.2 per cent higher than the provincial average.

Dr. Alison Braley-Rattai, Assistant Professor in Brock’s Labour Studies Department, gave a warning about taking statistics at face value.

“Unemployment figures are measured monthly so a snapshot in time can be misleading,” she says. “However, it is true that in general the Niagara region has faced higher unemployment numbers than the rest of the province and greater than in most of the country as well.”

`She suggests that one major factor in the region’s high unemployment rate is the nature of the industries in Niagara.

“In Niagara we have a region where manufacturing was heavy, but those jobs are now largely gone.”

The large portion of seasonal jobs as well as Niagara’s older than average population may be other factors in the high unemployment numbers.

Niagara’s youth unemployment rate raised even more concern. At the end of 2017, that number hovered at 9.5 per cent. The youth unemployment rate applied to individuals between the ages of 15 and 24.

“The social and economic effects [of high youth unemployment] can be quite severe depending upon a number of things. On one hand, youth who see no opportunity may leave for places where they believe things are better, which does not bode well for the future of the region“, said Braley-Rattai. “At the more severe end, youth unemployment may create social division, even political unrest and instability. Most frighteningly of all is that this unrest can be expressed in decidedly undesirable ways, such as increased expression of xenophobic and nativist sentiment, as people blame ‘the other’ for their economic precarity,”

She also expresses concerns due to tendencies for individuals without work to postpone and put off individual life steps such as developing relationships and having children. Additionally, job insecurity can directly or indirectly cause health effects that affect the economy of the region.

Another frightening statistic is the year to year decline in the numbers of those who hold jobs or are actively searching for employment. This rate, known as the participation rate, fell from 63.3 per cent in 2016 to 60.7 per cent in 2017. This trend calls to question why the job market is losing activity and why people have ceased looking for work. Although the aging population may be a factor, it is a trend that needs to be seriously considered.

In terms of economic changes to bring unemployment numbers down and the participation rate up, Braley-Rattai has a few thoughts and suggestions. First, she mentioned the GO train service being developed for Niagara, which will create jobs and provide other indirect economic benefits. She also mentioned the surplus of employable persons compared to the number of jobs available.

“There is often a lot of focus upon job training and postsecondary education as a solution. Training and education are important and ought to be well funded, but this also ignores an important reality that there are more job seekers than there are positions being created. We have seen jobless growth and that may well be a permanent feature of advanced capitalist societies. If that is true, then job training and postsecondary education will not be enough.”

Additionally, the classist nature of who has access to education and training affects who is hired first.

“My view is that we need to move to a new understanding of work and that will likely involve providing a basic income to all, and to engage in job-sharing. This, however, will likely fly in the face of how we have understood capitalist social relations and will be very difficult to do.”

“More generally, governments need to reduce incentives for private businesses to create precarious jobs. In this regard, there were a few missed opportunities with the Ontario government’s Bill 148,” she says. She also mentions the overemphasis on tax cuts.

“Decreasing corporate taxes has proven not to be a major job-creator. Tax rates are relevant, particularly when trying to attract new business, but they are only one factor.” Since other factors, such as public services including schools and transit, rely on a support base of taxes, “More targeted tax breaks geared toward those who have actually created a permanent, full-time position would be preferable to across the board cuts.”

“Secure employment allows people to get on with the business of living their lives: they don’t have to put off marriage and children, or move back in with their parents. Economically, people are able to contribute to the economy and the tax base that is imperative in providing people with the services they require,” says Braley-Rattai. Lower unemployment rates work to decrease social divisions and increase economic prosperity, and so a more holistic focus with new, creative resolutions to Niagara’s high unemployment rates is imperative.

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