Weekly employment hours lag recovery

Share

Most segments of the Canadian economy have recovered from the recession - from economic output to employment levels and even business investment - save one: hours worked.

Average weekly hours remain below their prerecession peak, and a recent Statistics Canada analysis also shows more Canadians are working in part-time jobs when they'd really prefer full-time. While net employment levels have returned, full-time jobs have not.

The lag in regaining work hours has broader economic consequences. Canadians forced into part-time or precarious positions can't spend much, especially on big-ticket items, nor can they whittle down their debt.

Ron Jamieson is one. The 59-year-old lost his full-time position as a business manager at a technology company in July, 2008. Since then, he's done some consulting, a bit of pro-bono work and taken on temporary projects and contracts. He's learned new skills and worked in new industries. He put together a two-minute video biography and posted it in on LinkedIn and YouTube.

What he'd really like, though, is a permanent, full-time job. Without that stability, he has cut spending on travel and restaurants and decided not to get a new car. "We've reined things back in," he says in an interview from his home in Etobicoke, Ont.

Although the overall labour market has shown healthy growth in the past few months, hours worked remained a soft spot. Average actual weekly hours worked were 33.2 in January, compared with 33.6 at the employment peak of October, 2008. Total actual hours worked is also down, to 571 million in January from 577 million in the fall of 2008.

A recent Statscan study on the labour market found full-time jobs evaporated in the downturn, forcing more people into part-time work. There were 113,000 fewer full-time positions in October, 2010, than two years earlier, and the number of involuntary part-time workers swelled by 20 per cent in the same period.

"Hours worked have not fully recovered, and that just speaks to the nature of the recovery thus far as being less than ideal," said David Madani, Canada economist for Capital Economics. "It puts more pressure on household finances."

One in five employed Canadians, or 19.4 per cent, were working part-time in January, an increase from a month earlier. Part-time employment has grown 2.8 per cent over the past year, compared with 1.7 per cent in full-time growth.

"A lot of workers that were displaced [from]their jobs by the recession have managed to find some sort of work subsequently … but often of really inferior quality to what they earned before," said Andrew Jackson, chief economist at the Canadian Labour Congress.

He's seeing several trends in the labour market. First, young people are bearing the brunt of the shift as laid-off older workers settle for lower-paying, entry-level part-time jobs that used to be the domain of younger workers (a rising youth jobless rate backs that up - it jumped to 14.4 per cent in January from 13.8 per cent the previous month).

Second, job creation over the past two years has been disproportionately tilted toward health and social services, in areas such as care for the elderly and personal support, where jobs are often part-time. "People tend to associate part-time with retail and accommodation and food - but it's also quite prevalent in social services," he said.

Mr. Jamieson, for his part, has stepped up his quest for a full-time permanent position in the past half year after learning his wife was due to lose her position. He is optimistic and says hiring is picking up. "My phone's been ringing more."

More details on the jobs market will come Friday, when Statscan releases its labour force survey for February. Economists are expecting the jobless rate fell to 7.7 per cent with 24,900 jobs created.