The Most Important Fact About April’s Employment Numbers

The unemployment rate for April was unchanged at 7.2%. Enough full-time jobs were added to keep the rate from rising. If you look at the mainstream headlines, most of them focus on the fact that the economy added 12,500 jobs.

Compared to March’s numbers — which were the worst since February 2009 — some might think, “Well, that’s pretty good! It’s nice that the rate didn’t go up.”

Actually, the numbers are quite awful. The new jobs were all in the public sector: 34,000 of them. The private sector lost 20,000 jobs.

The most important fact about April’s employment numbers is this: Fewer people are going into productive tax-paying work than non-productive tax-consuming work. These numbers imply a weakening economy. Government jobs must be paid for with private sector production.

The economy is down for about 13,000 net jobs for 2013 so far. If you look back since April 2012, there is job growth. Yet looking closer, we see that the government has added 94,000 jobs in that period year. Private sector jobs? Only 10,000.

It is important to understand that just “creating jobs” should not be a goal of policy. Any job is not inherently valuable. Instead, what matters is creating wealth.

The buying and not-buying of consumers normally determines what should be produced, but no one “buys” government services. Public sector jobs earn wages and that money gets spent in the economy, but the consumer does not voluntarily pay the government for the goods and services produced by these jobs. Therefore, it cannot be said that government jobs provide any economic value at all.

Practically speaking, this accounts for why all governments are characterized by incompetence, arrogance, inefficiency, carelessness, and poor service. Government jobs are just subsidies for production with no regard to the consumer.

For the past year, the parasite has been growing at the expense of a progressively weaker host. This cannot continue if we want to see a stronger Canadian economy.

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