Economic shock and regional resilience: Continuity and change in Canada's regional employment structure, 1987–2012

Abstract

This article analyses regional resilience to economic shock in Canada from 1987 to 2012, a period that included severe recessions and major free-trade agreements. Employment is cross-tabulated by region, industry and gender and partitioned cumulatively using three-way multifactor partitioning for each period from 1987–1988 to 1987–2012. Employment loss in each recession is found to be more closely associated with industry-mix in the preceding growth period than with the region effect. At each recession, manufacturing had much bigger employment losses and a much weaker recovery than business services. Thus manufacturing amplifies economic shocks, while business services act as regional shock absorbers. Manufacturing employment decline in Ontario was influenced by trade liberalization and far exceeds what would be expected from the industry and region effects alone. Female employment growth outpaced male employment growth in every region and in every industry group apart from business and appeared to be more resilient to recession. But corrected for their industry composition and regional disparities, these gender differences are substantially reduced.