According to a new report, Canadian public sector jobs saw a 13 percent increase during the COVID-19 pandemic, while the private and self-employed sectors only experienced 3.6 percent growth.
“Canada’s net job creation in recent years has been disproportionately driven by growth in government employment rather than growth in the private sector,” said Ben Eisen, a senior fellow at the Fraser Institute and co-author of the report.
Eisen and co-author Milagros Palacios noted that government employment as a share of total employment is at its highest point since the 1990s and that public sector job growth has significantly exceeded its private sector counterpart in recent years.
“We find that the current economic recovery’s reliance on government job growth is historically unusual,” they wrote. “Comparing the current economic environment to past recessions and slowdowns, we see that none of those recoveries were as dependent on job creation in the government sector.”
Provincial Comparison
The report also examined employment growth in the provinces and found that, in most cases, the government sector expanded at a faster rate than the private sector.
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In Manitoba, public sector jobs increased by 10.6 percent, while private sector employment grew by 7.8 percent.
Quebec saw a 10.8 percent increase in government jobs and a 4.7 percent increase in the private sector.
Ontario experienced a doubling of public sector growth compared to the private sector, with government employment rising by 14.6 percent and the private sector by 7.3 percent.
British Columbia had just a 1.2 percent increase in private sector employment, while the public sector grew by 22 percent.
New Brunswick witnessed a 19.7 percent growth in public sector jobs, with a mere 3.9 percent increase in private-sector employment.
In PEI, public sector growth was at 25.5 percent, while the private sector increased by 7.7 percent.
Newfoundland and Labrador experienced a 7.2 percent increase in government employment and a 0.6 percent increase in private sector employment.
Saskatchewan added 15.8 percent of public sector jobs and 3.6 percent in the private sector.
However, the trend did not hold true for all provinces. In Nova Scotia, government employment increased by 4.7 percent, while the private sector saw 7.7 percent growth. In Alberta, the public sector saw a 4.4 percent increase in jobs, while the private sector grew by 9.2 percent.
US Comparison
The authors also compared the data with United States job growth, noting that it differs significantly from Canada’s situation.
“In the United States, the private sector has been responsible for the majority of new jobs in recent years, with the rate of net job creation in the private sector nearly matching that in the government sector,” the report stated.
Between 2019 and 2023, the public sector accounted for 46.7 percent of total job growth in Canada, compared to just 16.1 percent in the United States.
