BC's Unemployment Stats Misleading

Friday, January 09, 2009 03:45 AM

Clearly the difference between the economic downturn in the early 80’s and what we face now, is the fact that while the unemployment rates hit upwards of 20% in this region in 1981-82 , we are looking at a totally different work force in 2009.

The bulk of the baby boomers are now heading into retirement, rather than showing a major increase in unemployment, these people are simply retiring either by choice or with the cancellation of their job.

To suggest that the unemployment rate is somehow different this time around is simply not true, given that huge portion of the working force that is now on pension.

Governments are aware of this information but it is better kept on the back burner to try and paint a different picture than what really is happening out there.

Canada has an ever increasing greying population, many of them, leaving the working force at the peak of economic and cut backs in employment.

In the Prince George area two things have happened, in the early 80’s young workers headed off to Alberta to catch a piece of the oil action. We lost a lot of our young people in that go round and they never returned. In 2008, faced with no work again, a lot of our young people have headed across the border in search of steady work. Whether this was a good move or not we will see, as the oil patch begins to show a crack in its wall as the price of oil drops to lows not seen since the 70’s.

The next problem to surface will be how to provide sufficient retirement money for those who are leaving the work force in the country. Canada’s retirement fund also was involved in the market crash and you simply cannot print money and put it into circulation without a back lash.

That will be the area of concern in the economy in 2009

I’m Meisner and that’s one man’s opinion.

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Posted on Friday, January 09, 2009 03:45 AM in Views by Ben Meisner

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Comments

Posted by: RUEZ on January 9 2009 6:44 AM

That would definately explain why we've had thousands of layoffs yet the unemployment rate is staying around 6-7%.

Posted by: Eagleone on January 9 2009 7:22 AM

I think you're right Ben. I think even more than that it could turn out millions are going to find out they won't have the pension they thought they would have... and the rest will have little of what they thought they were going to have.

Hypothetically lets say the stock market was still at 15,000 and not 8000 and nobody lost a dime in the stock market to this point in their pensions.... I think the pensioners would still get wiped out in the coming market because a trickle of inflation 6-months out from now is going to turn into a rout of hyperinflation by year end... you can't pump a trillion dollar stimulus into the economy and not expect to have inflation. What pension will be able to adjust quickly to hyperinflation?

Protection IMO will be found in hard assets, and access to reliable cash flow... and not a reliance on investment cash flows for the next 5+ years. AIMHO

Posted by: Runner46 on January 9 2009 9:02 AM

Of course we are looking at a totally different work force. If you tried to compare that work force with 1/4 of a Century prior there would be obvious differences as well.

I do not agree with you analysis of this situation. It is not based on fact but on thoughts.
I think the difference in our points of view is that I prefer to think the sky is not falling, all though the market has.

Posted by: winnie on January 9 2009 11:33 AM

The other thing the statistics may not reflect is the number of people who's EI has run out so they are now on the Welfare roles. I think the unemployement statistics only counts those on EI, am I correct? It's not as accurate a picture of the unemployed as we may be led to believe.

Posted by: Chester on January 10 2009 5:16 PM

Conservative Pension funds have declined at least 15% over the past year. Interest rates have also declined to rates we haven't seen in years. So, those who have headed for the protection of GIC's and Money Market funds are looking at less than 3% returns this year. Now, let's not forget taxes and inflation and we are losing money even in guaranteed savings.

The bright side is that our gas prices have slid back to a more reasonable level compared to July 2008. Probably our natural gas prices have decreased as well. Oh, and vehicle prices have definitely plummeted for anyone in the market for a vehicle. And, for anyone still saving for their retirement, we haven't seen prices like this since 5 years ago.

Unemployment. The numbers are definitely skewed and we shouldn't put much weight or credibility in them. The truth is that there are many more people not working than the numbers indicate.