The quality of employment in Canada significantly improved in the first nine months of 2010, regaining all the ground lost during the recession, finds a new report from CIBC World Markets Inc.

In a year in which the economy added close to 330,000 new jobs, employment quality increased by almost 4% despite the fact that part-time employment grew at a much faster rate than full-time positions.

The report notes that while the significant increase in part-time employment had a negative impact on the index, the strong increase in paid employment relative to self-employment acted to offset this negative. The key driver of the jump in job quality came from the fact that the distribution of full-time paid jobs improved notably over the past nine months. During this time, the number of high-paying jobs rose four times faster than low-paying jobs and more than 90% of the full time jobs created since early 2010 have been of the high-paying variety.

By province, the most significant improvement was in British Columbia which saw a 5.1% increase in quality. That province also saw the biggest drop during the recession when quality fell by 8%. Alberta and Quebec saw strong improvement over the last nine months with increases of 2.6% and 2.4%, respectively. However, not all provinces saw increases. Quality fell in Manitoba/Saskatchewan and Atlantic Canada.

While the overall improvement in employment quality is a positive economic sign, says Benjamin Tal, deputy chief economist and author of CIBC’s Employment Quality Index does not think the trend is sustainable. He notes that the public sector accounted for no less than 10% of all jobs created during the economic recovery. This contrasts to less than 1% in previous recoveries.

Tal adds that the construction industry, spurred in part by stimulus money, grew by 10% during the recovery, single-handedly adding a quarter of all jobs since the rebound began. At this stage in previous economic recoveries, the construction sector had been a drag on job creation.

IE