Toronto jobless rate jumps back up

Little more than two months after Mayor Rob Ford took credit for slashing unemployment in Toronto, the jobless rate has popped back up.

Now, city officials are trying to figure out what’s going on.

Ford was all smiles in September when he boasted that the city’s seasonally adjusted unemployment rate had dropped to 7.1 per cent in August.

That was down from 10 per cent in April, 2012, and Ford was happy to take credit.

“In January 2010 I promised to create jobs and tackle our unemployment rate,” Ford said at the time. “Another promise made, another promise kept.”

But lately, the numbers don’t look so good.

The unemployment rate had bounced back to 9.8 per cent in October, according to a city report.

That’s significantly higher than the unemployment rate in the 905 area, which was 7.2 per cent for October, and the Canadian average of 6.9 per cent.

If the Toronto figures are accurate, they show a loss of 57,000 jobs by Toronto residents in two months.

What’s going on? Is it a statistical blip?

Ford – who was fighting for his political life in council Monday – didn’t respond when asked to comment.

City officials are still trying to make sense of the unemployment numbers, which seem to conflict with other economic indicators.

Employment in the city usually tracks transit ridership very closely, a report on the latest numbers observes.

The Toronto Transit Commission reports that ridership was up in both September and October compared with ridership a year ago.

That “supports the thesis that the last two months of city (employment) data may not reflect real economic trends,” the city report says.

Peter Viducis, who wrote the report, said the huge number of missing jobs – 57,000 – is reason to take a second look.

For example, First Canadian Place houses about 5,000 jobs, he said. Losing that many jobs would be the equivalent of losing the jobs in more than 11 big office towers, in the space of two months.

You’d expect to have had some dramatic economic or corporate news to accompany that scale of job loss, he said.

“But nothing like that has happened,” he said. “Toronto is doing pretty well.”

Other indicators give a different picture, according to the report.

City staff looked at advertisements for new jobs and retail sales, both of which were strong during the period.

The amount of occupied office space fell, by 733,000 square feet, which sounds like a lot. But at 230 square feet per worker, that translates into just 3,400 jobs, Viducis noted.

While office vacancy rates in the third quarter were up slightly, they had been at a four-year low in the second quarter.

The city report also notes that pre-sales of housing have fallen, but prices continue to rise.

Monthly indicators can be volatile, Viducis cautioned. They contain the freshest information, but sharp month-to-month changes are sometimes smoothed out over a longer period.

He noted that in the five-year period from 2006 to 2011, the number of jobs held by Toronto residents grew 3.2 per cent, compared with 3.4 per cent for the rest of Canada.

Employment in the GTA outside Toronto (excluding Burlington and Oshawa) grew by 5.6 per cent during the period, while employment in Ontario declined by 1.5 per cent.