The hurt is on. After jumping to 6.1% in January, the ranks of BC’s unemployed swelled by 14,200 in February, pushing the unemployment rate to 6.7%, its highest level in five years. Given that February is the shortest month of the year, one can only imagine how bad things would have gotten had it been one of those brutal 31-day months.
Technically speaking, the number of employed dropped by 4,900 and the size of the labour force grew, so we have to be careful about the numbers. These are also monthly survey data, which have some swings to them, so we should mostly note the trends. But the conclusion is inescapable: this is bad and it shows the utter state of denial of the BC government, who just weeks ago in their 2009 budget forecast that the unemployment rate for the entire year of 2009 would be 6.2%. In fact, we are likely to see an unemployment rate above 7% by the time we vote, perhaps pushing 8%. I’ve been musing that unemployment rates would close the year in the 8-9% range; if present trends continue, that will have been overly optimistic.
BC Stats has the full set of numbers and breakdowns by industry and other key characteristics. Total employment in the good-producing sector, which constitutes much of the primary employment and income that supports other (mostly, service-oriented) jobs in the economy, fell by 8% compared to a year ago. After a large drop in January, construction employment was essentially the same in February, which is a relief in the short-run anyway. The big challenge for 2009 is going to be rising unemployment from this sector as projects wind up, and new ones are not there to replace them (housing starts are down 70% according a report earlier this week).
In the service sector, total employment is just below where it was a year ago, but down quite a bit from its peak in June 2008. Losses in a number of sectors have been kept at bay by some growth in the public sector, notably education, and health care and social services (offset somwhat by civil service cutbacks). So thus far, the public sector is cushioning the fall – we certainly do not want to pile on right now with major public sector cuts, although that would appear to be the case given a read of BC Budget 2009.