Ontario Federation of Labour

Ontario Federation of Labour

May 13, 2014 09:24 ET

CORRECTION FROM SOURCE-OFL: Public Sector Layoffs Would Push Ontario to 9.7% Unemployment Levels and Drive Province Into Recession

TORONTO, ONTARIO--(Marketwired - May 13, 2014) - The following corrects are replaces the release that was sent this morning at 7:46 AM ET. In the third paragraph the line that reads ".67% in the public sector" has been adjusted to read as ".67 jobs in the private sector". The complete and corrected release follows:

Conservative Leader Tim Hudak's pledge to get rid of 100,000 public sector employees has stunned workers, families and communities across Ontario, says the Ontario Federation of Labour (OFL). It would be the biggest layoff ever to take place in Ontario and the OFL warns it will be ruinous to the economies of both urban and rural communities.

Last month, in Ontario, unemployment was 7.4 percent, still well above pre-recession rates. These proposed cuts would drive that number up even higher. If the spin-off benefits of public sector jobs are considered, the OFL warns that Hudak's plan could push unemployment as high as 9.7 percent, higher than the 9.4 percent experienced in Ontario at the height of the recession.

Hudak ignores the fact that spending by the public sector and its employees generates tens of thousands of jobs in the private sector, in this case, 67,000 of them. The standard economic multiplier in use calculates that every public sector job creates .67 jobs in the private sector.

"Imagine the devastation this will cause in our communities when you consider that for every two public sector jobs cut at least one more is lost in the private sector," said OFL President Sid Ryan. "With 167,000 Ontarians booted into the unemployment line, cash from those workers' pockets will also stop flowing to local businesses, while the province would dive back into a recession."

Ontarians are counting on a steady economic recovery and cannot afford a Hudak government and the job losses that would come with it. For already hard-hit cities like Peterborough and Windsor, with the highest and third-highest unemployment rates in Canada according to Statistics Canada, the consequences will be dire. Peterborough posted the top jobless rate at 11.6 percent; Windsor's came in at 8.4 percent, up from 7.3 in March.

The OFL warns that the Hudak cuts are part of a broader Conservative plan that would step-by-step turn Ontario into a low-wage economy, while leaving ordinary Ontarians struggling to get by with less.

www.ofl.ca

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Contact Information

  • Ontario Federation of Labour
    Sid Ryan
    OFL President
    416-209-0066
    www.twitter.com/SidRyan_OFL

    Ontario Federation of Labour
    Lynn Simmons
    Communications
    416-578-3230