All in all a fairly brutal LFS. Ontario continues to get hammered suffering a disproportionate number of job losses and with the high wage sectors continuing to take a beating. The only dimly bright spot in the LFS data being that outside of the number (volume) of unemployed no new records appear to have been set this month. And while it is true that we are now at 1997 levels in terms of the absolute number of workers unemployed this obsevation ought to be tempered by the fact that there is a larger absolute labour force today than there was in 1997.
In terms of the actual unemployment rate, no new records (going back to 76) have as yet been set. However, given the size of the LF actually increased this month the reported rate of 7.7% actually underestimates the degree of unemployment.
In the chart below I adjust for this by plotting a second measure of unemployment which simply divides the number of unemployed by the number employed (UE/E light). The second plot (UER) is the standard rate. What is interesting is the severity of the steepness in the angle of the increase of unemployment–it is steeper than the 90s recession and almost on par with that of the early eighties.
All that said there is a still a long way to go before we get to the unemployment rates of the ugly eighties and nasty nineties. My gut says we are going to get at least to the record rates of the 1990s but the real fear is how long unemployment rates last rather than how high unemployment rates go. That is, a record in the duration of above trend unemployment will be much more devastating than a record in the one month rate.
More to come