This post was written by Mike Veall of the Department of Economics at McMaster University.
I have been asked by a few people about my statement here that “I would hope that whoever is in charge, whoever wins the election, that eight years from now we would have a million more jobs …I would expect the employment rate to continue to bounce back from the recession. That alone, probably, would get us to a million.”
I should have said “close to a million” but here’s my calculation:
From http://www.fin.gov.on.ca/en/economy/demographics/projections/table10.html, the reference scenario projection of the 15+ population of Ontario in 2022 is 12,608,550 (total population of 14,985,150 less the 0-4 population of 800,710 less the 5-9 population of 787,470 less the 10-14 population of 788,420). If the employment rate stays constant at 61.2%, under this population scenario employment will be 0.612 × 12,608,220 = 7,716,433 in 2022, which is almost 800 thousand greater than April, 2014 employment. The Labour Force Survey suggests that the Ontario population forecast (which appears to have been made in 2013) is a little high: my adjustment for that reduced the gain to about 700 thousand.
From CANSIM, Table 282-0027, the Ontario employment rate was very close to 63.5% throughout 2007 and for 2008 before November. If Ontario returns to that employment rate by 2022 and the reference scenario population projection holds, employment will be 0.635 × 12,608,220 = 8,006,429 which is well over a million greater than April, 2014 employment. Again, however I note that the reference scenario population may be tracking high: when I adjust for this I get a gain of a little less than a million.
I am open to criticism for suggesting the employment rate will bounce back from the recession without reference to policy (where there are big differences in views as to what the right policy is). Regardless, my view is that job quantity should never be the only focus. Job quality and GDP growth are more closely linked to prosperity.
Note: This is a follow-up to Mike's earlier post.