Carla Qualtrough is in a reflective mood.
The minister of employment is doing a round of media interviews after nine months of the worst job losses in modern history, and she is seizing the moment to survey the damage and figure out what’s next.
Like many of her cabinet colleagues, Qualtrough wants to think big – to strategize how the power and money of the federal government can amplify a speedy recovery from the pandemic in a way that doesn’t just repair the labour market but sets it on a better path.
Yes, build back better.
The Liberals’ plans for that are starting to pile up. We have the 223-page mini-budget with its $382-billion deficit and plans to spend up to $100 billion on recovery. We have the 79-page, $15-billion climate plan. We have 132 pages of advice from private sector leaders to launch an aggressive industrial strategy with the help of $100 billion in government funding. And we have 116 pages of dreams about powering everything with hydrogen.
The lists of recommendations and the money involved allow just about every aspiration for Canada’s future to have some space.
But Qualtrough’s challenge is a lot more immediate – and a lot more gut-wrenching – than the blue-skying her colleagues have set to paper.
There are still 1.7 million people unemployed – about 600,000 more than before the pandemic – and many more underemployed or barely hanging on to jobs that exist in name only. The unemployment rate is 8.5 per cent, down from a record high of 13.7 per cent in May but much higher than the pre-pandemic rate of 5.6 per cent.
And it’s much higher than that among visible minorities and in certain sectors – accommodation, food services, tourism, travel – where wages are often not that great to begin with and job loss strikes a harder blow on family finances.
All told, about 17 per cent of the workforce has been hobbled by the recession, either working less than they’d like or not working at all. Normally, that rate is around 11 per cent.
So even though the job market has improved a lot since the shutdowns of last spring, it has a long way to go. And rolling shutdowns are sending people out of the workplace again, especially in big cities.
Qualtrough, by her own admission, thinks through these numbers “obsessively” – not just because employment is important for its own sake but because the government’s recovery plan hinges on it.
The feds have benchmarked their recovery strategy to improvements in the labour market; only when jobs come back will Ottawa declare success over the pandemic. It’s a recognition that holding down a decent job is central to the everyday lives of Canadian citizens. Without confidence in the job market, Canada’s economy won’t be as strong as it could be.
“We need to shore up the jobs we have” by supporting businesses with wage subsidies and rent support through the pandemic, Qualtrough says.
“And then we need to look “at how the things we want to do” – such as tackling climate change and investing in infrastructure – “create jobs. I kind of consider it my responsibility to make sure there are trained, skilled workers ready to go.”
A lot of the jobs will come back on their own once most people are vaccinated and we can move about freely again, says economist Brendon Bernard at Indeed Hiring Lab, who focuses on the Canadian labour market.
But inevitably, there will be some permanent damage, some of which will be obvious right away and some of which will only show up over time, Bernard says.
That’s because the pandemic has actually changed the structure of our economy, and it won’t grow back the same as before.
Working from home is likely to be more prevalent. A surge in digital business, data-oriented transactions and online interaction puts a premium on technological skills that won’t disappear. Some small businesses are failing and will be replaced by new companies with different focuses. We may all want to return to restaurants, but we may not all want to return to browsing the shelves in malls.
Long-term unemployment seems to be mounting, and workers who have been without jobs for extended periods typically have great difficulty getting back into the workforce as their skills and experience atrophy.
The permanent damage – or “scarring,” in economists’ jargon – is what weighs on Qualtrough when she tries to merge her immediate concerns for the pandemic workforce with the long-term planning to push Canada towards a sustainable economy with a more equitable workforce.
“My biggest worry is for young people,” she says, pointing to new graduates who have tried to enter the job market at a time when workplaces are scaling back dramatically. “There are all these generational impacts. We could lose a generation of talent.”
Mothers of young children and marginalized workers are also top of mind, she says.
In an ideal world, those people would be put to work on all the build-back-better initiatives the federal government is contemplating. But that’s an awkward fit without a massive and creative federal-provincial effort toward retraining and skills, Qualtrough says.
That’s her 2021, she says.
“You’re going to see training permeate everywhere.”
Heather Scoffield is a National Affairs writer.