Canada's unemployment mosaic, 2000 to 2006

Abstract

he unemployment rate is a well-known baro- meter of labour-market health. The rise in the national unemployment rate in the years immediately following the high-tech meltdown has been replaced by sustained annual declines, resulting in a rate of 6.3% for 2006. This is not only below the 6.8% registered during the boom, but a 30-year low as well. 1 Of course not all parts of the country have shared equally in the improvement. Some have done better, others worse. Normally, comparisons involve the 10 provinces or 5 regions of Canada, but within each, many distinct labour markets can be found. This article focuses on the 28 census metropolitan areas (CMAs) and the 10 provincial non-CMA areas (see Data source and definitions). Using the Labour Force Sur- vey (LFS), the article first tracks unemployment rate dispersion for local labour markets (CMAs and non- CMA areas) between 2000 and 2006. It then examines the comparative labour market performance of these areas based on unemployment rates and rankings, and unemployment duration. Unemployment levels, labour force, and employment are provided in an appendix. Unemployment rate dispersion rising The impressive performance of the national unem- ployment rate in recent years hides considerable geo- graphic disparities. For example, in 2006 the unemployment rate in the Quebec CMA averaged 5.2% compared with 8.4% in nearby Montreal. Simi- larly, the unemployment rate in Kitchener (5.2%) was much lower than in Windsor (9.0%). That the unemployment rate will differ by geographic area is generally understood. All things being equal, the dispersion is expected to narrow in periods of eco- nomic growth, when the national rate is usually falling