In this two-part series, BC Jobs, we probe key developments in British Columbia’s labour market in 2016. In the first blog, BC’s 2016 Job Performance within Canada, we gave an overview of BC employment growth in 2016 within the national framework. In this second part of this series, we take a deeper dive into the labour market and shed some light on the regional dimensions.
BC led the country in employment growth
Over the course of 2016, BC added 73,300 new jobs. The employment growth rate increased to 3.2% —triple that of Ontario, the next best performer, and nearly four times greater than the overall Canadian average.
Unequal regional jobs picture
In aggregate, the robust job gains in the province over recent years are good news. However, the story becomes less rosy when we look at trends in the regions. Meaningful job growth only occurred in the Lower Mainland/Southwest region and Vancouver Island in 2016, while losses were sustained in all other regions.
Urban concentration of job creation
The majority of employment increases in BC have been heavily concentrated in the southern corner of the province. In 2016, 65% of all net new jobs were created in the Lower Mainland-Southwest, followed by a 15% gain in Vancouver Island and 10% in the Thompson-Okanagan. Digging a bit deeper, most of the new jobs within these regions were created in urban centres – Metro Vancouver, Greater Victoria, Kamloops and Kelowna.
Source: CANSIM Table 282-0124.
Unemployment rates are a telling tale
The dichotomy between rural and urban labour markets can also be explored through the unemployment rate. Provincial unemployment fell from 6.2% of the labour force in 2015 to 6.0% in 2016. Unemployment rates dropped below the provincial average in only two regions: Lower Mainland/Southwest (5.5%) and Vancouver Island/Coast (5.8%). While the overall unemployment rate may be low, in part this is explained by brisk job growth in the major urban centres.
Elsewhere, most other BC regions are characterized by stagnant/dwindling employment opportunities. Last year, unemployment rates climbed well above 7% in less populated regions. Unemployment in the Northeast—a region that saw a big boost in employment when gas production and exploration was strong—nearly doubled from 5.4% to 9.7% between 2015 and 2016.
Source: CANSIM Table 282-0124.
Bottom line: Unequal distribution of job gains brings uncertainty
Probing the BC jobs story showcases a marked contrast in job growth between rural and urban areas. Many British Columbians located outside of the major city centers face greater challenges finding and sustaining employment. An improvement in this situation ultimately depends on stronger commodity markets and a pick-up in production and investment in the energy, mining and forestry sectors.
While BC continues to lead Canada in job growth and also boasts an enviable fiscal position, it is important to keep in mind the complexities and regional variations evident in the provincial labour market. Ensuring that more British Columbians have opportunities to participate in the labour market and contribute to economic activity can give the province a stronger foothold for the future. As low interest rates continue, it is important to invest in infrastructure projects that support economic activity in communities not currently experiencing much growth. The rural infrastructure investment announced in the 2017 BC Budget is a step in the right direction.