Isn’t It Time To Re-Unite Canada’s Department of Labour With Its Department of Immigration?

February 15, 2006: Isn't It Time To Re-Unite Canada's Department of Labour With Its Department of Immigration?


Not a week goes by without some voice in Canada saying that this country has a shortage of skilled workers. Early last fall, the loudest of these voices was that of Canada's last Immigration Minister.

The big problem with his statements was that he never produced any evidence to support his claim. He also refused to acknowledge high unemployment in parts of Canada and the need for the federal government to look after Canada's unemployed first.

Therefore, the question Canadians have to ask about the latest calls for more skilled immigrants is the following: Is there evidence to support these calls?

Let's start with a recent Toronto Star report. It stated that a Mississauga furniture factory, which employed 100 skilled workers, was closing down after 23 years of business. The reason: the high Canadian dollar and cheap imports from China.

Jay Myers, chief economist with Canadian Manufacturers and Exporters, notes that the Canadian dollar increased 36% in value in the past three years.

According to Steven Theobald, Business Reporter with The Toronto Star, the Mississauga factory was one of many casualties. Canada lost 145,000 manufacturing jobs in the 12 months ending in January 2006. Canada retains about 2.13 million manufacturing jobs out of a total of close to 17.3 million jobs (Source: Statistics Canada) that Canadians were working at near the end of 2005.

Manufacturing jobs are often skilled labour jobs. Although B.C. and Alberta are experiencing an economic upturn, experts see the loss as part of a long-term decline in the manufacturing sector (especially in Ontario) and a trend across Canada towards a service economy. As most Canadians know, most service-sector jobs do not pay as well as those in the manufacturing sector.

So if skilled Canadian jobs are disappearing and are predicted to continue to do so in future, why do Canadians continue to hear the clamour for more skilled workers?

The reason may be that the calls originate with the immigration industry and that the calls are really for a continuation of current high immigration levels or an increase in those levels. As observers have frequently noted, this industry has conditioned a number of Canadians to parrot what it says—even though there is little evidence to support the immigration industry's statements.

Consider two analyses made in the U.S. recently of similar calls for skilled workers, that is, for continued high (or increased) levels of immigration. One analysis is by Alan Tonelson, a Research Fellow at the U.S. Business and Industry Educational Foundation. Mr. Tonelson is author of “The Race To The Bottom: Why A World-Wide Worker Surplus and Uncontrolled Free Trade Are Sinking American Living Standards”.

Tonelson was responding to recent calls for the need for more skilled workers from three voices: the U.S. National Association of Manufacturers, the Chamber of Commerce and the Information Technology Association of America. Ironically, all three have been involved in a massive out-sourcing of skilled work to China and other areas of the world.

According to Tonelson, “The main studies are slipshod methodologically and internally contradictory. Second, they clash with everything known about major trends in the U.S. labor market, and about labor shortages.”

“Similarly, many of the policies long championed by these multinational-dominated business groups thoroughly undercut their professed concerns about labor shortages. For example, it's hard to imagine that talented people will flock to manufacturing production careers in a nation whose trade policies encourage the massive offshoring of such jobs.

“And it's hard to imagine that talented people will flock to research, development, engineering and design careers in manufacturing in a nation that not only encourages the offshoring of these jobs, but that admits large numbers of immigrants who will do this work for bargain basement pay. Yet, that's exactly the kind of nation that Washington has given us—at the behest of the same multinationals now crying 'Labor shortage!' Talk about a self-fulfilling prophecy.”

In “Nuking The Economy”, former Assistant Secretary of the U.S. Treasury, Paul Craig Roberts, presents a second, blunter analysis.

Analyzing Labor figures from 2001 to 2005, Mr. Roberts concludes that the U.S. economy was more than 7 million jobs short of keeping up with population growth. His observation: “That's one good reason for controlling immigration. An economy that cannot keep up with population growth should not be boosting population with heavy rates of legal and ilegal immigration.”

Mr. Roberts accuses some journalists of merely “re-writing White House press releases”. Condemning many American economists for failing America, he says that other economists (those who look beyond the political press releases) estimate the U.S. unemployment rate at 7 to 8.5%, twice what the White House claims it to be. According to U.S. Labour Statistics, at the end of 2005, between 132 to 134 million Americans were employed out of a population of around 300 million.

According to Roberts, “Over the past five years, the U.S. economy experienced a net job loss in goods producing activities. The entire job growth was in service-providing activities—primarily credit intermediation, health care and social assistance, waiters, waitresses and bartenders and state and local government.

“U.S. manufacturing lost 2.9 million jobs, almost 17% of the manufacturing work force. The wipe-out is across the board. Not a single payroll classification created a single job.

“The decines in some manufacturing sectors have more in common with a country undergoing saturation bombing during war than with a super-economy that is 'the envy of the world'.

“Little wonder engineering enrollments are shrinking. There are no jobs for graduates. The talk about engineering shortages is absolute ignorance. There are several hundred thousand American engineers who are unemployed and have been for years. No student wants a degree that is nothing but a ticket to a soup line.

“Offshore outsourcing and offshore production have left the U.S. awash with unemployment among the highly educated. The low measured rate of unemployment does not include discouraged workers. Labor arbitrage (simultaneous laying off of U.S. workers and hiring of foreign workers) has made the unemployment rate less and less a meaningful factor. In the past, unemployment resulted mainly from turnover in the labor force and recession. Recoveries pulled people back to jobs.

“Unemployment benefits were intended to help people over the down time in the cycle when workers were laid off. Today the unemployment is permanent as entire occupations and industries are wiped out as corporations replace their American employees with foreign ones.” (Unemployment rates do not include those who are virtually permanently unemployed.)

Roberts concludes, “The U.S. is experiencing a job depression.”

“On February 10, the U.S. Commerce Department released a record U.S. trade deficit in goods and services for 2005–$726 Billion. The U.S. deficit in Advanced Technology products reached a new high. Offshore production for home markets and jobs outsourcing has made the U.S. highly dependent on foreign provided goods and services, while simultaneously reducing the export capability of the U.S. economy. It is possible that there might be no exchange rate at which the U.S. can balance its trade.”

Canada's new Immigration Minister should take careful note.

With over 85% of Canada's trade being with the U.S., can Canada be unaffected by these developments? How much sense does it make to be calling for increases in the number of skilled worker immigrants and in the maintenance of (or increases to) high levels in all other immigration categories?

Isn't it time for an overall plan for Canada's workforce to determine what Canada's real workforce needs are? And isn't it time to re-unite the Department of Labour/Employment with the Department of Immigration?