Monday, May 07, 2012

NDP blames oil sands for loss of manufacturing jobs

Thomas Mulclair, the new leader of the federal NDP, criticized Alberta's oil sands last week, saying they raise the value of the dollar which hurts manufacturing jobs in eastern Canada. This is quite similar to the position Ontario Premier Dalton McGuinty (unexpectedly) took during the recent Alberta election. Mulclair claims in the last 6 years "500,000 good paying manufacturing jobs" have been lost because of the oil sands. I disagree, as outlined after the break.

There are about 1.4 million unemployed people in Canada now. Since there were 1.1 million unemployed Canadians in 2006 I suppose it means that of those 500,000 at the very least 200,000 of them have found other jobs, but in reality it would have to be more because the labour force grew by at least a million people and other (non-manufacturing) recession hit sectors like banking and government. I suppose an NDP response would be that the jobs that replaced these manufacturing positions don't pay as well, but the statistical average would disagree - wages have grown roughly in line with inflation if not slightly faster. I would assume this grand NDP number includes jobs losses in the auto industry, which I suppose according to their version of reality would have bucked the trend set by Detroit and weathered the global recession unscathed if it weren't for that damnably high Canadian dollar. Mulclair appears to be saying that all the manufacturing jobs lost over the past six years had nothing to do with the forces that afflicted similar industries in the rust belt south of the border but by resource based economic expansion in other parts of Canada.

It also seems to ignore the jobs created by the oil sands throughout Canada, including 812,000 person years in Ontario alone. That suggests to me that even if Mulclair's number is correct (which it almost certainly isn't) then the industry would have more than made up for the lost man years in the most manufacturing-intensive province by itself.

If the NDP wants to try to pit west against east, that's their own prerogative. Mulclair should be aware, however, of how many easterners are employed by the oil sands as well as general Canada-wide support for the industry before he badly miscalculates his hand.

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