It took nine months of detective work by economists, journalists, social media sleuths and investigators at the Parliamentary Budget Office to solve the mystery of Canada’s missing job vacancies. Last week Auditor General Mike Ferguson made it official: The federal government was using unreliable statistics to support its claim that Canada had plenty of jobs but no workers with the skills to fill them.

The first clue that something was wrong came last August. Speaking at a policy conference in Kingston, economist Don Drummond said he had combed Canada’s labour market statistics looking for indications of a serious shortage of skilled workers – which Prime Minister Stephen Harper had called “the biggest challenge our country faces” – and failed to find any credible evidence if a misalignment between the skills of Canadians and the needs of employers.

That sent a ripple of unease through the economic community, but the government stood fast, bringing in thousands of temporary foreign workers to fill the jobs for which Canadians were not trained and promoting the centerpiece of its 2013 budget: a controversial Canada Job Grant, which required the provinces to surrender control over workforce training.

The second trouble signal came eight weeks later. The Toronto Dominion Bank did its own analysis. It found isolated skill shortages in Saskatchewan and Alberta but no widespread mismatch between workers’ qualifications and employers’ needs. “Perceptions can take on a life of their own without hard underlying facts,” said the bank’s deputy chief economist, Derek Burleton. “With data in hand, we debunk the notion that Canada is facing an imminent skill crisis.”

Again the federal government pressed ahead, urging the provinces to address the skills gap despite their objections to the Canada Job Grant. But the headwinds increased. Questions about Ottawa’s numbers were popping up in think tanks, unions and media reports.

One journalist in particular, Bill Curry of the Globe and Mail, was determined to find out where the government was getting its information. The only hint he had was a cryptic reference to “Wanted Analytics” in former finance minister Jim Flaherty’s 2013 budget.

The Quebec-based company describes itself as the leading source of real-time business intelligence for the talent marketplace. It offers clients data pulled together from online job postings, government statistics, reports of hiring intentions by individual businesses and trade associations, and its own soundings. The government said the firm’s methodology was protected by commercial confidentiality. Curry was temporarily stymied.

But one of Wanted Analytics’ other clients – the Conference Board of Canada – had developed its own suspicions. It reported them to the Parliamentary Budget Officer, who launched an investigation.

Jean-Denis Fréchette and his staff examined each of the company’s inputs and pinpointed the culprit: Kijiji, an online classified ad service operated by eBay. It allowed employers to post the same vacancy under several headings – jobs, services, community – creating double and sometimes triple counting.

There was no immediate response from the government, but in the days that followed Kenney ratcheted down his rhetoric, referring to isolated shortages in specific regions. This month, the skill shortage that the Tories had been trumpeting for more than a year quietly disappeared from the government’s job vacancy survey.

Unfortunately, that isn’t the end of the story.

In response to the exaggerated skills shortage, Ottawa has allowed hundreds of thousands of temporary foreign workers into the country. There is now substantial evidence they are taking jobs from Canadians and driving up the unemployment rate in some parts of the country. The $3-billion Canada Job Grant, built on the same premise, takes effect in July.

This isn’t the first time the Conservatives have launched a major initiative on the basis of dubious or non-existent statistics. It unveiled its multi-billion-dollar Safe Street and Communities Act while the crime rate was dropping. Cabinet minister Stockwell Day insisted there was a rise in “unreported crime.” It cancelled Canada’s long-form census because 10,000 people complained that it violated their privacy. In fact, 27 people complained.

Loading... Loading... Loading... Loading... Loading... Loading...

This time, thanks to the efforts of a handful of tenacious diggers, the skill shortage myth has been exposed. But the attitude from which it sprang persists.