Finance Committee on March 6th, 2014

[Murray Rankin, NDP, Victoria, BC]

Regardless of the nature of the job they end up getting. So if they fall—

[René Morissette]

Regardless of the nature of the job they might end up getting subsequently.

[Murray Rankin, NDP, Victoria, BC]

Exactly. In other words this makes it look like people who have found work in fact are people who may well—as I keep hearing anecdotally and I'm sure other members do—be qualified for something much greater but are working in a service sector job. Now they are employed.

The next question is on page 5 of your slides. There's a strange thing I wanted to ask you about on the slide on the left. It would appear if I'm correct that those people who have a trade as opposed to simply a B.A. have a higher unemployment rate, and that again would suggest if you're a person with a B.A. you get a job in the service sector, and that's fine.

[René Morissette]

That suggests that if you have a job, with a B.A. you have greater chances of finding a job.

[Murray Rankin, NDP, Victoria, BC]

Right. Again....

[René Morissette]

Again, the issue of overqualification is a distinct one, but that's what the numbers reveal here.

[Murray Rankin, NDP, Victoria, BC]

Thank you.

My next question is for the CLC. Amy, I would ask you this.

I'd like you to expand on a report that was introduced today, and you referenced it in your remarks as well. Your organization concluded the true underemployment rate is 27.7% for those between 15 and 24 in 2013. I think you said that. Yes?

So what is the difference between the way your organization, the CLC, has calculated underemployment, and the way, if at all, Stats Canada does?

[Amy Huziak]

We do have this new report that just came out today called “Underemployment is Canada's Real Labour Market Challenge”. Angella is one of the authors of the paper. Basically it breaks down to underemployment, that 27.7% number, is considered to be: those who are unemployed, so unemployed young workers; those who have dropped out of the labour force and aren't looking, that's those 350,000 young workers who are no longer looking for jobs or who have returned to school; and those who are involuntarily working part time.

One of the numbers we get through Stats Canada is they do an averaging of the number of hours part-time workers are looking for, and don't talk about the actual number of workers affected, so that's how we get to that number.

[Murray Rankin, NDP, Victoria, BC]

I appreciate that.

Again, I'm asking you this question. Mr. Saxton pointed out the Canada apprenticeship loan program in the last budget, and the fact that now young workers are going to have access to an interest-free loan.

Has your organization considered the impact of further debt on young workers in that context?

[Amy Huziak]

Absolutely. I think as part of what we would say towards gathering further debt is more debt, even if it is to get to a positive outcome, isn't the way we would like to see it going. We would like to see a grants-based program.

[Murray Rankin, NDP, Victoria, BC]

I'd like to ask a question of Ms. Josephs.

Is the record high level of student debt an obstacle to recent graduates starting their own business and growing the economy that way?

[The Vice-Chair, NDP, Peggy Nash]

We're just about out of time so very briefly, please.

[Marsha Josephs]

We have seen it has been a challenge. However, that trend is beginning to change. That is why we have changed our requirements that now those who are in their final year of study can apply to CYBF for our programs, and that's a very positive sign.

[The Vice-Chair, NDP, Peggy Nash]

Thank you, Mr. Rankin.

Mr. Van Kesteren, back to you for five minutes, please.

[Dave Van Kesteren, Conservative, Chatham-Kent—Essex, ON]

I think Mr. Keddy is going to go first, and then I'm going to take the remaining time.

[Gerald Keddy, Conservative, South Shore—St. Margaret's, NS]

A couple of questions keep coming back here.

I have to pick up a little bit on the chair's question about wage scarring. It is a term I'm not familiar with, but I'm having some difficulty with it. Either you're working or you're not working, and if you're working you can look for a better job. A number of things will control that.

I'm going to use two examples.

A good friend of mine, whom I went to high school with, went on to university and became a geologist. I don't know why he became a geologist. He wanted to become one and he enjoyed it, but he didn't want to travel. Intervention in K-to-12 might have helped him. After a couple of years of working as a geologist, mostly in Canada's north, he came back and went to community college and became a machinist. He loves that job and is happy doing it. Should he be “wage-scarred” because he left this other job and somehow went to...?

I use the example of another good friend of mine. We were neighbours; we grew up on opposite farms. He became an engineer and worked for 15 years. He was vice-president of his own company, and after 15 years as senior vice-president, he made as much money as his chief electrician. Should he be “wage-scarred?”

I don't get the term. My point is that there are obstacles facing people in employment, and at every job you're not going to get to be boss, or you're not going to be a rocket scientist, or not going to be a computer programmer, or you're not going to be the prime minister. We all find our level and we work there and try to find happiness doing that.

It's an artificial term that I don't understand, so I'd like one more shot at having it explained to me.

[Amy Huziak]

I hear what you're saying. I think it's a good question.

In talking about wage scarring, we're not talking about transitions to other fields of work; that is separate from what we're discussing. Wage scarring occurs when you experience unemployment fully or underemployment.

Say that you have been working at a minimum wage job for five years and can't find any other employment than that. That would be something we consider to be wage scarring; whereas, if you were to work in a different field and then switched, that would be different.

[Gerald Keddy, Conservative, South Shore—St. Margaret's, NS]

Ms. Huziak, the example I gave you was of a young man who had seven years of education to become a civil engineer. His electricians, who had two years of post-secondary training, made more money than he did, because theirs was a job that paid more, they were in demand, and business was going well. Under your example, he should be wage-scarred, and I don't think he was; that's all.

[René Morissette]

In the study that has been referred to here, I think the authors looked at a cohort of people who graduated during one recession—probably the 1981-1982, or the 1990-1992 recession—and they tracked these people over time. They followed their earnings for the next 20 years and compared that cohort who graduated in a recession with another cohort who graduated right before a recession, and so in better economic circumstances.

They also tracked for 20 years the earnings of the lucky group who did not graduate in a recession. What they found is that about 20 years later, the cohort who had entered the labour market in a recession still had lower wages, after controlling for the same field of study—let's say comparing an engineer who had graduated in a recession with an engineer who had graduated in a good time. That's what the study did.

[Gerald Keddy, Conservative, South Shore—St. Margaret's, NS]

Thank you.

Did I leave him any time, or is he going to have to take his own round?

[The Vice-Chair, NDP, Peggy Nash]

You have about 30 seconds left.

[Gerald Keddy, Conservative, South Shore—St. Margaret's, NS]

No, he had better have his own round.

[The Vice-Chair, NDP, Peggy Nash]

Maybe we'll take that over to the next round.

Mr. Allen, do you want to start off this next round, and are you sharing with Mr. Van Kesteren?

[Mike Allen, Conservative, Tobique—Mactaquac, NB]

Yes, I do, and I will share with him.

I have a couple of questions for Stats Can. I want to refer you to your slides, on pages 7 and 8, where you talk about the percentage employed. You do it by regions—provinces and oil-producing provinces. Do you have other further breakdowns of this that would take us to the aboriginals within oil-producing versus non-oil-producing provinces? The aboriginal young population is a growing population, and so I'd like to understand exactly what percentage it makes up, of the groups you have here.

[René Morissette]

Ideally, we would like to be able to look at that, but as was mentioned a few minutes ago regarding immigrants, we only started in 2006 collecting information in the labour force survey on aboriginals and immigrants. We cannot paint the same historical trends as we have done overall. We cannot do that for aboriginals since the labour force survey data for them starts only in 2006, as it does for immigrants.