Cornwall, South Stormont hemorrhaging jobs since 2008, says study

In this Thursday, Nov. 2, 2017 infographic from the Fraser Institute, Cornwall has experienced the most net job loss among urban Ontario areas since 2008, according to a study by the think tank. (Fraser Institute via Newswatch Group)

CORNWALL – The City of Cornwall and parts of South Stormont hold the dubious distinction of losing a vast number of net jobs since the 2008 recession, according to a study out today (Thursday) by the Fraser Institute.

Eleven of the 23 urban areas of Ontario experienced a net job loss over the last eight years, but in the Cornwall area, the job market “collapsed” with the worst job decline as nearly a third of its employment opportunities vanished (32.8 per cent).

The study also notes metro Ottawa and Toronto accounted for almost 99 per cent of job growth in Ontario from 2008 to 2016.

The study looked at the underpinnings of job creation – labour force performance and rates of job creation within census metropolitan areas (CMAs) and census agglomerations (CAs). In Cornwall’s case, the census agglomeration spills outside the city boundaries and includes parts of South Stormont.

So, why the huge decline?

The study suggests a drop in manufacturing jobs may be to blame, though data for Cornwall wasn’t available. “While the data on manufacturing employment is not available for Cornwall, it seems likely that manufacturing decline is likely a contributing factor to its job losses,” the report states. Other Eastern Ontario cities were hit by manufacturing job loss – 1.2 per cent in Kingston and 3 per cent in Peterborough.

The study also pegged Cornwall’s unemployment rate at 8.1 per cent in 2016 – 1.5 per cent higher than at the height of the 2008 recession – and an employment rate below 50 per cent – a rate 10 points lower than in 2008.

While an aging population may be a factor, “it is not clear to what extent aging is driving the decline in the employment rate, as opposed to a simple lack of opportunity,” the study said.

Cornwall also experienced tepid employment income growth over the eight years – less than two-thirds of the provincial average – with an average salary of just over $23,000.

“There’s a great many communities across Ontario that have either experienced weak job creation…lower than the national average, or actually negative job creation. Almost half of the urban areas across the province have experienced negative job creation…they still haven’t recovered to pre-recession levels,” said Ben Eisen, director of the Ontario Prosperity Initiative with the Fraser Institute, in an interview with Cornwall Newswatch.

Eisen said the study doesn’t really look at the specific causes but called the Cornwall numbers “more extreme” than other cities. The study looked at more of the “broad phenomenon” that a lot of cities are not doing well over a long period of time – a performance masked by the job powerhouses of Toronto and Ottawa, he explained.

“If you take those out (Toronto and Ottawa) and just look at the rest of the province taken as a whole you have almost no job creation at all,” Eisen said.

“The most important takeaway is recognizing that Ontario’s overall economic performance has not been strong over this period of time. The big takeaway is to recognize the urgent need for stronger economic growth broadly in Ontario and pursue policy choices that are likely to contribute to that…uncompetitive tax rates and a large public debt…addressing all of these things to help drive broad economic growth across Ontario and it’s needed…urgent needed,” he said.

Jobs stakeholder sees improvements in labour force

While recognizing the past job challenges, Martha Woods, executive director with the Eastern Ontario Training Board, believes things are improving.

“I have seen an influx in the labour participation rate. In 2012, we have a 57.1 per cent labour participation rate. What’s happening is there’s a growing demand in terms of jobs. We have the jobs, we don’t necessarily have the workforce to fill those jobs,” Woods told CNW.

She said through programs with the EOTB they are trying to attract those people who are not working and get them into the labour force.

Speaking about the Fraser Institute study, Woods said we also need to take into consideration the composition of employers – the days are gone of the one large employer – and now smaller entrepreneurial businesses and small to medium enterprises are flourishing.

“Since 2015, we have had 135 more businesses incorporate within our geographical territory,” she said.

“I really good think that SD&G, Prescott-Russell, Akwesasne are really addressing that fact and recognizing that and validating that piece from the Fraser Institute and being pro-active and providing different communities with the opportunity to have those types of programs and apply for those types of funding that will enable that (building the workforce),” she said.

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