Scary headlines sell newspapers. Think about it. You walk by a newspaper box and read a headline that says “Family Dog Bites Person”, who cares. Instead, if the headline reads “Vicious Pit Bull Attacks Grandma”, now someone’s grandmother was attacked by a ferocious dog and its news. Suddenly people start buying papers like crazy to read what happened.
Both could be the exact same story, but the headline makes people read the story. Once you read the article you are able to get the real information buried somewhere within the news. That’s how news works and that is how papers get sold. The real information is always buried in the details.
This whole topic came from a story I read in the Calgary Herald’s online version today. Their headline is “Alberta’s EI cases growing fastest in Canada”. Scary isn’t it? First impression is that Alberta is far worse than any other province; it confirms the economy is crashing in Alberta, the situation is getting worse daily and we should all be afraid of potentially losing our jobs. Am I right? Think about it, didn’t that kind of go through your head initially?
It’s when you read the article you get to find out the details. We have had an increase of people claiming EI of nearly 165 percent from last October. This works out to over 30,000 newly unemployed in the province or a total of just over 48,000 unemployed in Alberta. With those types of numbers, odds are you know someone who has recently become unemployed.
So let’s look closer at it and look at the big picture. One important line in the article says, “Despite the increase, Alberta still holds one of the lowest unemployment rates in the country.” Hold on, that doesn’t sound so bad, does it? Our provincial unemployment rate is still only 6.6%. It wasn’t that long ago we were close to a 3% unemployment rate, which is full employment. In other words, the only qualification you needed to get a job was fogging a mirror.
We saw how well that worked by the incredible customer service you could receive at many businesses and companies we all had to try to deal with. Now this jump in unemployment doesn’t mean everyone who joined the unemployment ranks wasn’t a good employee, but face it, there were a lot of people working who would normally not get hired in a healthy economy! This has been an attrition process for some companies and is allowing them to weed out some of the less than exemplary employees.
When we look at Canada as a whole, Alberta’s paltry 49,300 unemployed doesn’t seem so bad. Canada wide the latest stats show 1.5 million unemployed and Ontario adding 59,700 to the unemployed in May alone! Our loss of 30,000 in almost nine months suddenly doesn’t look that bad now does it?
So now that we have our numbers in perspective, what does the fact that the percent of unemployed are growing faster in Alberta than anywhere else? Well when you look and realize how many people moved to Alberta just for work, and how many jobs have been created here in the last few years you have to believe many of these positions would be the first to go during a slowdown.
A majority of the newer jobs were in the energy sector or serviced the energy sector, which has been hit quite hard in Alberta, while the other major work projects revolved around the massive in-migration of people and companies and tended to be based on construction. With a slowdown in energy and a slowdown in construction, is it any wonder that these jobs disappeared? As these jobs slip away, many of the support services around them also had to shrink as their work load decreased.
So the end point of all this is when jobs are created so quickly to fill the booming economy, they can vanish just as fast. This results in a higher percentage of unemployed, just as we originally had a higher percentage of employed.
There are many signs the worst part of the downturn is done, at least for Alberta. Oil is hovering around the $70 mark (which three years ago everyone thought was great), home buying is increasing, money is starting to flow a bit more in our local economy and people are adjusting t the slowdown. We are not booming, but we are definitely not busting either, we just need to keep it all in perspective.
So next scary headline you read, take a minute to read the actual facts in the story and find out just how scary, or non-scary, it happens to be.
