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Ontario led the retreat, losing 51,000 jobs. So does the jobs report bear out forecasts that a higher minimum wage would cost jobs? The most credible forecasts, which did indeed call for the loss of about 50,000 jobs, were done by the Ontario’s own Financial Accountability Office and the Bank of Canada, drawing on the consensus in the economics literature (rather than the cherry-picking of favourable left-wing research by Big Labour organizations). However, the forecasts predicted the full impact would take months or even years to play out. The industrial breakdown of job losses supports that the minimum wage played only a small role in January’s slump, since declines were concentrated in high-wage industries and not accommodation and food, which are the most affected by changes to the minimum wage. This is bad news for the Wynne government as it approaches an election in June since it suggests that employers will continue to adapt to soaring labour costs by trimming their workforce for months to come.

The underpinnings to the Ontario economy have looked increasingly shaky for some time. Despite an improving U.S. economy, exports of manufactured goods have languished all year. Much of Ontario’s growth last year was just the sugar high of skyrocketing Toronto housing prices. A recent CMHC report found that while the fundamentals of job and income growth accounted for 70 per cent of demand growth in Vancouver’s housing market, those fundamentals accounted for only 30 per cent of Toronto’s, suggesting that speculation was driving a lot of the growth. Now, speculative buying in Toronto’s housing market is being deflated by the tax on non-resident buyers and new lending restrictions that took effect January 1st, with Toronto house sales falling 22 per cent in January.