Indicators of Labour Market Conditions in Canada

Abstract

The purpose of this study is to identify and assess the relevant measures and indicators of labour market conditions, as concern unemployment, in the context of current and future labour market and economic trends. It is also to verify whether and how the importance of these measures has changed over time. There are three main objectives for this report. The first is to ascertain to what degree the unemployment rate is an adequate predictor of labour market conditions in the context of the changing economy. Labour market conditions refer to the state of the labour market and encompass different dimensions. The second is to assess the suitability of other labour market indicators as predictors of labour market conditions. The third is to discuss the feasibility of aggregating relevant labour market indicators into a composite indicator of labour market conditions that might be considered for use in the design of government programs. This report concludes that the unemployment rate is actually a good indicator of labour market conditions, although it is wise to supplement it with additional indicators. The construction of composite indices does not seem to provide much more information on labour market conditions than the unemployment rate does.

Download full PDF article