Public Sector Work Archives - Centre for Future Work

The Build-Big Agenda in B.C. Should Include Long-Term Care Homes

Jim Stanford — Mon, 21 Sep 2026 03:00:21 +0000

British Columbia should make long-term care part of its big-project building agenda and commit to a construction timetable for seven deferred public care projects, says a new report from the Centre for Future Work.

The report examines the economic benefits of building public long-term care facilities, and the dangers and costs of relying on for-profit operators. It argues that full accounting of the costs and benefits of long-term care construction needs to include financing charges (which are much lower for public builds), broader economic spin-offs from new construction, and a range of savings resulting from superior health outcomes demonstrated in public facilities.

Projections indicate the province needs 16,000 additional subsidized long-term care beds over the next decade—about 1,600 a year. But over the last six years, B.C. added an average of only about 240 net new beds annually.

Despite that gap, seven public long-term care construction and redevelopment projects were deferred in the province’s 2026 budget. The provincial government continues to list the projects in its long-term capital plan, but without firm timelines for construction.

The report challenges exaggerated stereotypes about the cost of building public long-term care facilities, and called for more transparent and systematic comparisons of cost estimates. Many public projects include services such as child care, hospice spaces and other services, often accessible to the broader community – making simple per-bed comparisons misleading.

Financing is an important cost advantage for public builds. In an illustrative comparison, the higher cost of private borrowing increases cumulative interest costs by 41 per cent, adding $49 million to a $200 million project over 25 years.

Most long-term care in B.C. receives provincial government funding, regardless of whether a facility is publicly owned, non-profit, or for-profit. Those payments help cover building and financing expenses as well as operating costs. Data published by the B.C. Senior’s Advocate indicates that building costs in private facilities (ultimately charged to the public purse) are much higher than non-profit facilities.

Outsourcing new builds to private operators does not make the public cost disappear. Government still pays for those facilities through decades of care funding.

The report calls for a transparent comparison of construction costs across public, non-profit and for-profit facilities. It identifies ways to improve value in future projects, including using public land, sharing sites with other health services, standardizing designs and coordinating procurement.

It recommends that the provincial government quickly complete its review of the deferred projects, and publish a reliable construction timetable by the next provincial budget. It also calls for capital funding and development support for non-profit providers, alongside a longer-term plan to meet projected demand.

Please see the full report, Economic Benefits from Construction of Public Long Term Care Capacity in British Columbia, authored by Jim Stanford, Economist and Director of the Centre for Future Work.

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Health Care is an Economic Engine, not Just a Cost Item

Jim Stanford — Mon, 10 Aug 2026 18:56:42 +0000

Canada’s public health care system, which provides essential health services without regard to ability to pay, is one of our most cherished social achievements. Indeed, public opinion polls consistently show that medicare is the single feature Canadians most associate with our national identity. Support for universal public health care is thus an important element of Canadians’ response to the challenges to our economy and sovereignty posed by U.S. President Donald Trump.

However, the medicare system is under threat from inadequate funding, long wait times for some services, and ongoing pressure from investors to privatize services. In Alberta, new laws allow parallel private provision of key health care services (including diagnostic tests and some surgeries). Other provinces (such as Ontario) are also pushing privatization. Always underlying privatization efforts is the claim that Canada simply cannot ‘afford’ the big costs of the public health care system.

At the recent summit meeting of Canadian premiers held in Charlottetown, P.E.I. in July, premiers discussed the challenges of financing health care and called on the federal government to hold a national summit on future health funding. At the summit, Centre for Future Work Director Jim Stanford made a presentation to the premiers on the economic benefits of public health care. He stressed that health care ranks as one of the most important industries in Canada: it creates jobs, generates incomes, supports widespread economic spillovers, and is one of Canada’s leading sources of innovation and new technology. These benefits have to be considered alongside the costs of providing essential health services.

Here is the presentation which Stanford gave to the premiers. It drew on findings from a recent report Stanford prepared for the Canadian Federation of Nurses’ Unions, titled The Economic Benefits of Canada’s Public Health Care System. The report quantified the important ways in which public health care supports employment, incomes, economic growth, and government revenues. Seen this way, health care should be redefined as an investment—not just a cost item on provincial budgets.

Key findings from the report include:

Health care is one of Canada’s largest and most dynamic industries.
It employs 1.9 million waged or salaried employees, and hundreds of thousands more self-employed practitioners, specialists, and contractors.
Health care production accounts for about 8% of Canada’s total value-added (GDP), and over 10% of total employment.
Health care workers earn $120 billion per year in wages and salaries.
The health care system purchases $51 billion worth of supplies and inputs from a complex and far-reaching supply chain (composed mostly of private businesses).
Health care accounts for over $7 billion in annual research spending, the second highest of any Canadian industry.
Because health care is not highly integrated in international trade, it is relatively protected from global disruptions and shocks (like the effects of U.S. trade policies).
Universal access to quality health care unlocks many other economic benefits including: more flexible labour markets (workers are able to change jobs without fear of losing health coverage), enhanced longevity and well-being (supporting more labour force participation and higher productivity), and improved ‘social capital’ (safe and inclusive communities where interactions can occur more securely and efficiently).

In sum, health care cannot be understood solely as a ‘cost.’ It is also a powerful economic engine: a source of growth, jobs, incomes, tax revenues, and well-being. Understanding and appreciating the economic benefits of the universal public health care system can reinforce public and fiscal support for its maintenance and improvement.

Please see the full report here.

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New Research Shows National Child Care Plan Already Driving Economic Benefits In Ontario

Jim Stanford — Tue, 28 Jul 2026 04:33:57 +0000

The Centre for Future Work has co-published new research quantifying the economic and fiscal benefits being generated in Ontario from the new Canada Wide Early Learning and Child Care program.

The expansion of affordable child care services in Ontario resulting from that new program has delivered a substantial economic boost to the province. That boost would have been even stronger, if the provincial government had not lagged behind other provinces in implementing the new national program.

The report finds that Ontario’s GDP in 2024 was $13.6 Billion higher than it would have been without the expansion of child care since 2019.

That growth in GDP generated approximately $2.25 Billion in extra provincial revenue in 2024 alone. This amount slightly exceeded the provincial funding to child care that year, indicating the program effectively pays for itself through increased economic activity.

Job Creation: Over 17,000 new jobs have been created in Ontario’s child care sector since 2019, with total sector compensation expected to exceed $3 Billion in 2026.

Empowering Women in the Workforce: Core-age (25-54) female labour force participation in Ontario increased by two full percentage points between 2019 and 2026—outpacing the national trend. This shift, combined with more women moving from part-time to full-time work, added 81,500 full-time-equivalent workers to the provincial economy.

Improved Job Quality: Average weekly earnings for child care workers rose by 39% since 2019, while average weekly hours increased from 26 to 31.

“Affordable, quality child care services are a vital precondition for economic progress,” says Jim Stanford, author of the report and Director of the Centre for Future Work.

“The data confirm that even Ontario’s partial and inconsistent rollout of the national program has been an economic boon. However, the province is leaving billions of dollars in potential growth on the table by failing to meet its targets for new spaces and lower fees”.

The report comes as the Ford and Carney governments continue to negotiate a new child care agreement.

Despite economic gains, the report highlights significant concerns regarding the Ontario government’s commitment to the Canada-Wide Early Learning and Child Care program. Ontario’s current child care agreement is set to expire in March 2027, and Ontario remains 25% behind its target for creating new spaces for children under six. Furthermore, while the national goal is $10aDay, daily CWELCC fees in Ontario currently average $19 with a cap of $22. The report also criticizes the province’s heavy reliance on for-profit providers—accounting for 44% of full-day spaces—which research associates with lower quality of care and higher staff turnover.

The report was co-published with the Ontario Coalition for Better Child Care and the Association of Early Childhood Educators Ontario.

The report concludes with urgent recommendations for the Ontario government, including securing long-term funding through 2031, eliminating “child care deserts,” and fulfilling the $10aDay affordability promise.

“If Ontario fails to fully commit to a universal system, these historic economic gains will be squandered,” added Stanford.

Please see the full report here, and a one-page summary of its key findings.

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Federal Budget 2025: Unpacking the New Capital Budgeting Framework

Jim Stanford — Wed, 05 Nov 2025 18:46:14 +0000

Leading into this budget, the Carney government made much of a new distinction between operational spending and capital spending: between “spending” and “investing”. However, in practice this distinction was mostly optics – and did not reflect any meaningful change in budget accounting and reporting.

The main budget numbers continue to be reported on an accrual accounting basis, which includes an annual deduction for the depreciation of fixed capital assets owned by the government (rather than reporting cash expenses on current capital spending).

In Annex 2, the budget document explains its new “Capital Budgeting Framework,” and presents a set of tables outlining what it calls “capital investment.”

“This framework helps distinguish day-to-day operational spending from capital investment (broadly defined as spending that supports capital formation), allowing the government to identify and prioritise initiatives that deliver long-term economic returns.”

Budget 2025, p. 281.

But this flow is not in fact equivalent to capital spending conventionally understood (in either accounting or economic terms).

This section lists six broad categories of “spending” (including tax expenditures, which are foregone revenue not actual spending) in areas that are argued to promote and facilitate capital investment. The six categories include:

- Capital transfers to other governments or organizations, tied to capital spending by those other agents.
- Capital-focused tax incentives to private agents.
- Amortization of federal capital (the flow of depreciation that still appears in conventional budget reporting, and in fact reflects previous capital spending, not current capital spending).
- Private sector R&D incentives.
- Support to unlock large-scale private sector capital investment (consisting solely of previously announced tax expenditures to support electric battery production).
- Measures to grow the housing stock.

The choice of these categories is utterly arbitrary, and reflects a deep private-sector bias in understanding what constitutes an “investment.” Why is a tax incentive for private-sector R&D considered an “investment,” but public R&D spending (through government, universities, or other public institutions) not? And why is spending on education, and other forms of “human capital”, not considered an investment?

Moreover, the value of the indirect incentives to private actors depends on whether those private firms indeed undertake the expected level of investment. For many reasons (not least including the chaos unleashed by Trump’s tariff policies) that private investment spending may not materialize – in which case the value of these federal incentives (categorized as “investments” in their own right) will shrink.

The main purpose of this capital budgeting framework seems to be to focus public attention on the importance of investment to future growth and prosperity (a laudable goal), and to justify continuing budget deficits on grounds that they are financing “investment” rather than excess “spending”. In this light, the fact that the total apparent expenditure associated with those six categories in 2029-30 ($59.6 billion) exceeds the projected deficit for that year ($56.6 billion) is the basis for the government’s claim that the “operational budget” will be balanced by then. Any remaining deficit will be allegedly due to expenses (including foregone revenues through tax expenditures) associated with those six categories of “investment”.

This is a very arbitrary and unconvincing way to distinguish between government current and capital spending. Other governments (including municipal governments and many provinces) report capital and current spending separately, on more genuine grounds (with capital spending defined more accurately as direct investments in physical or other lasting assets). This approach could even be modified in the federal government’s case to include transfers for direct capital spending by lower levels of government (which constitute a large share of total federal investment measures). But the inclusion of tax expenditures and other indirect incentives for private activity is far-fetched, and seems motivated by a desire to justify those measures as part of a program to boost capital investment. Many of those incentives may indeed be justifiable – but that hardly means they should be considered federal capital spending.

How much capital spending is actually forthcoming from this budget? This is hard to ascertain, given the nebulous nature of the categories and the associated reporting. The first figure shows the total composition of ‘spending’ across the six categories, using 2024-25 as a baseline. This “investment” almost doubles from $32 billion to $60 billion by 2028-29. It grows by a cumulative total of $120 billion over the five years. The increase in the annual flow of this “investment” is worth about 0.75 percentage points of GDP by 2028-29.

Most of that growth in ‘investment’ was already projected to occur on the basis of past announcements and normal growth trajectories. The amounts of new “investment” announced in this budget are much smaller: about $1 billion in new measures this fiscal year (2025-26), and then $8-9 billion per year in the next four years. This represents a cumulative increase in “investment” due to the budget of some $35 billion over the five year forecast period. On average that represents a boost to GDP of at most 0.25% per year.

As explained above, a significant share of this total consists of supports and incentives for private-sector investment-related activity. Those private supports (tax incentives, R&D incentives, and the electric battery program) make up 45% of the total cumulative growth in “investment” spending (compared to the 2024-25 baseline) over the five-year forecast.

However, almost all of that private support had been previously announced. The biggest components were the Clean Economy investment tax credits and the EV battery program (both announced in 2023 or 2024 to match Joe Biden’s IRA incentives, and both of which are supported by most progressive economists and environmental movements). There was surprisingly little new private investment support announced in this budget (and included in this capital investment annex): less than $2 billion in total over five years (mostly for the super-deduction accelerated write-off for certain forms of private investment). These newe measures accounted for just 5% of the total new “investment” spending announced in the budget.

So while the budget’s attempt to reclassify many measures (including tax incentives for the private sector) as federal “investment” is motivated by optics and unconvincing on accounting or economic grounds, there is little new in this budget to criticize about “corporate handouts”. The only significant new corporate tax measure (the super-deduction) is tied directly to investment spending in targeted industries (and is a model supported by many progressive economists).

How much of the announced “capital” spending is genuine? Capital transfers, housing supports, and normal amortization are more genuine public or public-supported investment policies (although there can be devils in the details about some of the transfer and housing programs). Those three categories grow by a cumulative total of $66 billion over the five-year period ($33.5 billion of which is due to new announcements in the budget, mostly the big new capital transfers). That represents a more genuine capital injection of around $13 billion per year on average (or around 0.4% of current GDP): not enough, but not insignificant.

That more genuine flow of new investment, combined with the modest in creases in nominal program spending (corresponding, in effect, to frozen real program spending) makes this overall budget mildly expansionary. Again, this is not enough given the historic challenges facing Canada. It should be criticized for not rising to that challenge, and for prioritizing the wrong things with its spending (such as defense spending). It is less convincing to criticize the budget on general grounds of “austerity”.

Another view on the extent to which the budget delivers a genuine increase in investment spending can be gleaned from its cash-based accounting of net financial requirements facing the government. Table A1.10 of the budget (on p. 251) provides a summary of the net cash requirements of the government, which must be met through new borrowing or other sources of liquidity.

The budget deficit is one cause of cash requirements (adjusted to reflect non-cash charges). Another cause is borrowing required for net acquisition of non-financial assets (that is, lasting capital assets), which in turn equals the government’s direct spending on actual new capital, minus non-cash deductions charged to the budget for depreciation of past capital investments. This flow of net non-financial capital acquisition (roughly equal to gross fixed investment less depreciation) rises from $6 billion in the current fiscal year (2025-26) to $21 billion in 2028-29, indicating an increase in real gross federal investment spending in the order of $15 billion per year (or close to 0.5% of GDP).

For comparison purposes, the total government sector in Canada currently spends about $130 billion per year on gross fixed capital investment. The federal government directly accounts for about 13% of that (ranging between $15-20 billion per year), but also supports fixed capital spending by lower levels of government through those capital transfer programs. Total public investment has been stagnant as a share of GDP (around 4%).

The measures announced in this budget should modestly increase total public investment, and the federal government’s share of it. But this incremental change clearly does not meet the challenge of the moment, despite the exaggerated narrative about it constituting a “generational” investment in Canada’s future. Compared to past nation-building moments and projects (like mobilizing for World War II, building a national railway or the St. Lawrence Seaway, etc.), the capital measures in this budget are small potatoes. The painful irony is that there are plenty of parallel projects that Canada needs (from an east-west-north electricity grid, to high-speed rail, to a genuinely massive housing construction program) that could constitute such a generational investment.

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The Economic Benefits of Expanded Child Care in British Columbia

Jim Stanford — Tue, 24 Jun 2025 12:00:42 +0000

The Centre for Future Work has released a new report documenting the widespread economic benefits resulting from the ongoing expansion of early learning and child care services (ELCC) in British Columbia, as part of the roll-out of the new Canada-wide $10-per-day child care system.

The report builds on previous research published by the Centre about the economic benefits already visible from the new national system: including jobs and GDP generated directly within the ELCC sector, indirect jobs created in supply and consumer industries, and benefits resulting from enhanced female labour force participation and full-time employment.

This new report reviews provincial-level data in B.C. for the same indicators. Economic data confirms that ELCC availability has been expanding rapidly in B.C., generating multiple economic and fiscal benefits:

Over 8,000 new jobs have been created in ELCC provision in B.C. since 2019. The pace of ELCC job-creation has been stronger in B.C. than in Canada as a whole: with employment up 62% for B.C., twice as fast as the 31% growth in national ELCC employment.
Average weekly earnings for ELCC workers have improved in B.C. thanks to stronger funding and the province’s Wage Enhancement policy. Nominal weekly earnings in B.C.’s ELCC sector grew 40% between 2019 and 2024, slightly faster than the average for Canada (36%).
Average hours of work have also increased in the ELCC sector—another indicator of improving job quality. The combination of higher hourly wages with longer hours of work (in part reflecting less reliance on part-time arrangements) produces a two-fold improvement in earnings.
Supported by improved access to child care, core-age (25-54) female labour force participation increased by over one full percentage point between 2019 and 2025 (broadly matching the similar experience in Canada as a whole).
The incidence of part-time employment among core-age female workers has also trended downward as the ELCC system has been expanded. The part-time employment rate among women in B.C. declined by 1.5 percentage points between 2019 and 2025, slightly more than the average for Canada.
The combination of increased labour force participation and increased full-time employment for core age women has increased B.C.’s provincial labour supply by some 33,000 full-time-equivalent workers over the five-year period ending in 2024.
Expanded employment and output in the ELCC sector, indirect and induced activity in both ‘upstream’ supply industries and ‘downstream’ consumer industries, and the incremental output produced via greater female labour supply, have together provided a strong boost to provincial GDP. The report estimates that provincial GDP in 2024 was $5.8 billion higher in 2024 (measured in real 2024 dollar terms) than would have been the case without the expansion of ELCC services after 2019, reinforced by the national $10-per-day program.
The provincial government itself harvests significant fiscal benefits thanks to the boost in GDP, employment, and incomes resulting from expanded ELCC services. Since the provincial government receives 17.5% of provincial GDP in the form of various own-source^[1] revenue streams (such as provincial income taxes, the PST, and other sources), the improvement in GDP resulting from expanded ELCC translates into approximately $1 billion in extra provincial revenue per year.

In sum, the new report confirms that expanded ELCC has been an economic boon for B.C., at a fragile time in the province’s economic history. Accelerating and strengthening the rollout of $10-per-day spaces in the province, and improving the quality of care (including by reducing the province’s current heavy reliance on for-profit providers), will be important in ensuring these economic benefits continue to be reaped in the years to come.

Please see the full report, The Economic Benefits of Expanded Child Care Services in British Columbia, by Jim Stanford. This report was commissioned by the Coalition of Child Care Advocates of B.C.

[1] Excluding federal transfer payments.

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Public Health Care Is Not Just a ‘Cost’… It’s an Economic Driver

Jim Stanford — Thu, 19 Jun 2025 19:49:31 +0000

Spending on Canada’s medicare system is typically understood simply as a major ‘cost’ item for government budgets. Seldom do Canadians consider the other side of the coin: public health care is also a pillar of Canada’s economy, and a powerful driver of growth, job-creation, and innovation.

Moreover, these economic benefits of medicare are becoming all the more important, in the wake of U.S. President Donald Trump’s trade war and other geopolitical disruptions. It is widely accepted that Canada needs to become less dependent on exports of goods and services to the U.S. market, given the unreliability of our major trading partner. Part of that historic shift will involve greater emphasis on the ‘non-traded’ economy: that is, industries which produce output in Canada, by Canadians, for Canadians, and which never crosses a national border.

Health care is the largest single industry in Canada, and it depends first and foremost on domestic work and domestic demand for health care services. In that context, the industry is relatively insulated from Donald Trump’s gyrations—making it a promising source of future investment and jobs as we pivot away from reliance on the U.S. market.

The Centre for Future Work recently partnered with the Canadian Federation of Nurses Unions (CFNU) on several initiatives to draw attention to the economic benefits of universal quality public health care.

With four co-sponsoring authors (including Marc-André Gagnon of Carleton University; Alika Lafontaine, former President of the Canadian Medical Association; Danielle Martin of the University of Toronto; and Steve Morgan of the University of British Columbia), Centre for Future Work Director Jim Stanford penned an open letter highlighting the economic benefits of medicare.

The letter highlights the many economic benefits generated by universal public health care:

Job-creation and growth
Indirect jobs and supply chains
Innovation and research
Labour market advantages (lower labour costs, better labour mobility)
Fiscal savings
Social equality and inclusion

The letter was signed by 275 economists, health policy experts, and experts in related fields, and released coincident with the G7 leaders’ summit in Kananaskis, Alberta. The goal was to stress to government that investing in health care (and other public and human services) is as important to strengthening Canada’s economy in the face of Trump’s disruptions, as the major investments in infrastructure and construction capturing most public attention at the moment.

Please see the public letter, and the full list of signatories here. A French-language version of the letter is available here.

The letter generated considerable media interest—including being featured in a full-page advertisement that ran in the Globe and Mail newspaper on June 17 (the closing day of the G7 meetings… hopefully Donald Trump picked up a copy before he departed early from the summit!)).

Jim Stanford was interviewed about the letter by several media outlets. Here is one feature interview with Dan MacDonald on CKLW800 AM Radio in Windsor explaining the rationale for the letter, and why investing in a stronger medicare system will help to stabilize Canada’s economy as we grapple with the fallout from Trump’s trade war.

In addition to the open letter, Jim Stanford also co-authored a commentary article with Linda Silas, President of the CFNU, summarizing the economic benefits of public health care, and arguing against the fiscal austerity and spending cuts that some politicians are advocating in the wake of the Trump tariffs.

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$10-per-Day Child Care Plan Already Boosting Canada’s Economy

Jim Stanford — Mon, 25 Nov 2024 05:00:21 +0000

In 2021, Canada’s federal government announced a new $10-per-day national early learning and child care (ELCC) program, which began rolling out in 2022. It has increased the number of regulated child care spaces in Canada, and significantly reduced (by over 50%) average fees paid by parents.

Economic research has long highlighted the economic benefits of accessible, quality ELCC, in at least three broad categories:

- Economic activity and employment associated with the direct operation of ELCC services.
- Improved labour force participation, employment, and incomes for parents of young children (especially women).
- Improved lifetime achievement for children who received high-quality early child education (including superior outcomes in education, employability, earnings, and health).

While it is still early in the new program’s history, it is clear major economic benefits are already being generated. A new report, Powering Growth: Economic Benefits from Canada’s $10-per-day Early Learning and Child Care Program, by Jim Stanford (Director of the Centre for Future Work) quantifies those benefits, including:

- Significant job-creation: Employment in ELCC has grown by 40,000 positions since 2019. This sector has been the sixth largest source of new work in Canada since 2019.
- Earnings: Increased funding under the new program, combined with complementary agreements around wage grids, training, and workforce retention, are supporting increased wages for ELCC workers. Average weekly earnings have increased 28% in the last five years.
- Hours of work: Another sign of improving job quality in the ELCC sector is the growing prevalence of full-time work. Average hours grew by 6% (or almost 2 hours per week) between 2019 and 2024.
- Aggregate earnings: ELCC workers will earn over $8 billion in wages and salaries in 2024 (up almost two-thirds from under $5 billion in 2019), supporting stronger consumer spending in many thousands of households.
- Female labour force participation: Female labour force participation has grown notably, supported by the expansion of ELCC services. Since 2019, core-age (25-54) labour force participation by women has grown by 1.4 percentage points (translating to 110,000 additional workers.
- Female full-time work: Accessible ELCC services allow more women to work full-time hours. The share of core-age women working full-time has increased by 2 percentage points since 2019, equivalent to adding another 65,000 women to the labour force.
- GDP growth: Direct GDP in the ELCC sector will exceed $11 billion in 2024, a strong increase from 2019. Further GDP gains are also produced by supply chain purchases by ELCC centres (including construction and renovation of facilities), downstream consumer spending by newly-hired ELCC workers, and the output of incremental female workers engaged in paid work thanks to more accessible, affordable ELCC services. All told, $32 billion in additional GDP was generated in 2024 from the combination of increased direct ELCC production, indirect (upstream and downstream) spin-off jobs, and increased female labour supply. The expansion of ELCC services likely prevented Canada from experiencing a ‘technical recession’ in the second half of 2023.
- Fiscal benefits: Federal and provincial governments collect a significant share of incremental GDP through various tax channels (including income, sales, and corporate taxes). The enhancement to national output arising directly and indirectly from expanded ELCC services has thus already contributed several billion dollars to annual government revenues.
- Inflation: The average cost of child care services to Canadian consumers declined 28% between 2021 and 2024 – in contrast to the 13% increase in overall consumer prices experienced in the same time. As the biggest ELCC cost reductions were being introduced in 2022 and 2023, ELCC price cuts measurably reduced national inflation.

Please see the full report for detailed evidence on these varied channels of economic benefits already visible from the introduction and expansion of the $10-per-day program. Canada’s economy is already benefiting from this important program.

Ce rapport est également disponible en français.

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Yes, Public Sector Jobs Count, Too

Jim Stanford — Sun, 15 Sep 2024 18:34:35 +0000

B.C.’s unemployment has been among the lowest in Canada for several years, economic growth and business investment have been among the strongest, and the province now has the highest hourly wages for employees of any province. Yet some business commentators try to debunk that record, claiming it’s all due to public sector spending and hiring.

Yes, public sector jobs have been important in B.C.: not just for the essential services those workers provide, but also for the all-round economic stimulus that results from growing health care, education, and other public services. Moreover, this growth clearly benefits the private sector, through several channels – which explains why capital investment and private sector GDP growth have also been among the best of any province.

In this commentary, originally published in BiV, Centre for Future Work Director Jim Stanford challenges the simplistic ‘private good, public bad’ mindset of business lobbyists, and sets the record straight about the value of a balanced and inclusive economic growth strategy. For more evidence on the strength of B.C.’s recent economic performance, see also his submission to the recent B.C. labour code review, “Growth With Inclusion.”

Public Sector Jobs are as Valuable as Private Sector Jobs

by Jim Stanford

Imagine an industry that created 100,000 new jobs in British Columbia over ten years, paying over $60,000 per year on average, and mobilizing advanced technology and skills. You’d think a success story like that would be celebrated by economists and business commentators.

Well, there is such an industry in B.C. It’s called health care. It’s the biggest employer in the province. And it created over 100,000 new, decent jobs in the last decade.

Curiously, however, instead of popping champagne corks, some commentators view the creation of health care jobs as a bad sign, not a good sign. And they express equally negative attitudes toward other public sector jobs – like education, community services, and child care.

For example, business economists Ken Peacock and Jock Finlayson recently complained that private sector employment in B.C. was growing too slowly. They studiously ignored thousands of new jobs in health care, education, and other essential services. It’s as if they don’t count.

But those jobs do count – just as much as private sector jobs. They employ people. They add to GDP. They generate incomes. They support taxes. They produce services that are vital to quality, healthy living.

Directly and indirectly, they also sustain private sector jobs, through multiple channels. Public institutions (like hospitals and schools) buy billions of dollars of inputs from the private sector. Their workers patronize private businesses with their own household spending – from retail to construction to transportation. And by building a healthier, better-skilled workforce, good public services facilitate private investment and innovation.

It’s a myth that strong public service employment somehow squeezes out private sector jobs. In the last year, the number of private sector employees in B.C. grew 1.6% – significantly faster than in Canada as a whole. And B.C. is one of only three provinces where self-employment is higher this year than in 2017, despite the pandemic and its aftermath. It turns out that securely employed public workers also make good customers for small businesses.

This virtuous combination of public and private job-creation explains why B.C.’s overall labour market consistently beats national averages. B.C. currently has the third-lowest unemployment rate of any province, and has enjoyed consistently below-average unemployment since 2017.

Thanks to lower unemployment, combined with wage-boosting labour policies (including the highest minimum wage of any province), wages in B.C have done better than elsewhere in Canada. In fact, in 2023 B.C. took the title of highest average hourly wage for employees in Canada (previously held by Alberta). Business economists might not be thrilled about that. But people who work for a living certainly are.

Overall economic growth hasn’t been hurt by B.C.’s strong investments in health care and other public services – to the contrary, it’s been helped. B.C. had the second-fastest growth in real GDP of any province in 2023, and the second-fastest since 2017 (in both cases bested only by booming PEI). Even counting just the private sector, B.C.’s GDP growth still ranks second-fastest (again, behind PEI).

Real business investment in both non-residential capital and intangible innovation (like research and software) has grown faster in B.C. since 2017 than any other province. A well-educated and healthy workforce is key for attracting incoming investment – especially in talent-dependent industries like B.C.’s booming tech sector.

Another myth is that private sector industries create wealth, while public sector industries spend it. That’s also false. The jobs, incomes, and taxes supported by quality public services contribute as much to prosperity as any private jobs – indeed, more so than the insecure, low-wage jobs that are typical of too many private-sector industries. It can just as reasonably be argued that private sector industries couldn’t exist without the infrastructure, human capital, and cohesiveness that public services provide.

In short, a simplistic “private sector good, public sector bad” perspective leads to flawed economic conclusions. It misunderstands the past performance of the provincial economy, and misdiagnoses the policies needed to make it even stronger.

B.C.’s overall labour market and economic performance in recent years rank consistently among the strongest in Canada. And the province’s strong investments in health care, education, and other essential services have been an essential part of that success.

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The Role of the Public Sector in Rebuilding After COVID-19

Jim Stanford — Mon, 14 Dec 2020 17:53:35 +0000

Canadians have understandably turned to government for protection and support during the COVOD-19 pandemic. But the public sector will also need to play a vital role in leading the reconstruction of Canada’s economy once the pandemic has subsided. This has been emphasized in previous Centre for Future Work research, including our PowerShare report on how work must be improved after COVID, and Jim Stanford’s call for a ‘post-war’ economic rebuilding strategy led by expansive government investment.

In this feature interview with Cory Hare for ATA News (the journal of the Alberta Teachers’ Association), Jim Stanford explains why expanded public sector investment, service provision, and hiring will be vital to continued economic recovery.

As Stanford says in the interview, knee-jerk portrayals of public service activity as wasteful or costly are exactly backwards:

“The public sector is a vital anchor of stability for the economy. The public service and the public sector are not subject to the same roller coaster ups and downs as private sector activity. This is a good thing, not a bad thing.

“Instead of seeing the public sector as a cost or a drain, we should see the public sector as an industry in its own right, and as a growth industry. Our demand as a society for education and health services is growing, and this is also a good thing, not a bad thing.

“The jobs that can be created in those sectors should be celebrated rather than trying to suppress that natural growth and suppress the income associated with it.”

Please see the full interview here.

The post The Role of the Public Sector in Rebuilding After COVID-19 appeared first on Centre for Future Work.

Reconstruction After COVID-19 Will Require Sustained Government Leadership

Jim Stanford — Mon, 25 May 2020 18:38:27 +0000

The Centre’s Director Jim Stanford had a feature interview yesterday with Michael Enright on CBC Radio’s public affairs show, Sunday Edition, on how Canada’s economy will rebuild after the COVID-19 pandemic and lockdowns.

A full recording and an abridged transcript is available on the CBC site here.

Stanford argued that government investment, income security payments, expanded public services, and direct public sector employment will all be crucial to lift Canada’s economic activity back to its potential, once it is safe to go back to work.

“This has actually been a real-time experiment that a national government — particularly one that has its own currency, as we do in Canada — has got basically no limits on how much money it can raise and mobilize in order to meet pressing emergencies, whether it’s in our economy or in our society or health system.

This is absolutely unprecedented and it’s quite appropriate. And it does confirm that at a time of crisis we need national government to be there, to be big, to be fast and to mobilize everything it can. It’s kind of like fighting a war. We never stood back from World War II and said we can’t afford to fight this war. We did what we had to do and we mobilized the resources, including the money to pay for it.”

Stanford also debunked arguments that the government debt incurred to pay for emergency measures during (and after) the pandemic will require years of austerity and belt-tightening in order to ‘pay down debt.’ With appropriate employment, fiscal and monetary policies, that debt need not hold back the post-COVID recovery we need.

The CBC conversation builds on Jim’s previous research paper, for the Institute on Research in Public Policy, on the need for an ambitious, well-funded post-COVID reconstruction plan.

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