British Columbia's unemployment rate has topped Ontario's for the first time since 2005, leading one economist to try to find out why.
The answer, Robert Kavcic of BMO Nesbitt Burns believes, lies in strong public sector hiring in Ontario.
British Columbia's jobless rate jumped in January to 8.2% from 7.6%, Statistics Canada reported last week, while Ontario's held steady at 8.1%.
"Both provinces implemented the HST at the same time, so aside from uncertainty over its future in B.C., there's probably not much to differentiate the two on that front," Mr. Kavcic says.
"January's 13,000 drop in manufacturing jobs in B.C. is curious, and comes one month after a similarly curious 45,000 jump in Ontario," he adds. "But perhaps most striking is the ongoing public-sector hiring spree in Ontario, where employment is up 5.5% year over year, third only to PEI and Newfoundland -- one wonders how long this can last with fiscal restraint looming on the horizon."
In a report last week, CIBC World Markets forecast that economic growth in British Columbia would outpace that in Ontario both this year and next, and that jobless levels in the western province would run well below those of its central Canadian counterpart.
