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The worst decision in constructing the index was using the average pay by industry as a proxy for what jobs are actually paying. I say worst, because you don’t have to use a proxy. Statcan publishes the pay levels earned by all employees. Here is what it shows in the nearby graph. Since 2010, low paying jobs at less than $12 an hour have fallen by half a million positions. Jobs paying between $12 and $20 an hour have grown slightly; those paying $20 to $30 an hour increased by 300,000. And jobs paying more than $30 an hour have expanded by a whopping one million positions. Does that sound like the quality of jobs is deteriorating, never mind sinking to the worst on record?

By comparison, the CIBC index shows that jobs have grown the most in industries that pay the least. However, that misses that most job creation has been in jobs that pay the highest wages, irrespective of the average wage in a particular industry. The only reason to use a proxy of wages instead of the actual wage data is that the track record is longer (wage data only go back to 1997). Again, no reputable statistical agency would make such a decision. If a time series is wrong, and a better one exists for a shorter period, you always use the better data.

Aiding and abetting the media in popularizing this meaningless data series is the silence of economists at other financial institutions. These same economists gleefully jump on every mistake Statcan makes, which is fair enough since the government compels taxpayers to feed its statistical beast. Douglas Porter, BMO’s head economist, openly boasts about “bringing to light the most serious error on record by Statistics Canada” on the CD Howe website (referring to a mistake in consumer prices). Yet for years no one has commented on the obvious flaws of the job quality index.