The above graphic is what comes out of a text mining algorithm when one feeds in Hudak’s Million Job Plan that he is basing a lot of his Tory campaign promises upon. Reading through the plan not a lot of detail is evident, plenty of large pictures of people who seem to be working in offices and one picture of a Heinz plant. So given the lack of conscious evidence in his economic plan to create 1 million jobs, I thought potentially his handlers may be using subconscious techniques to communicate how such an amazing amount of jobs could be created.So I ran this Million Job plan through one of the latest text mining analysis algorithms to see if one can synthesize any core logic.
Recall that even in the headiest days of Ontario’s past, when our economy was booming- we could barely create one million jobs over an eight year period. Given I have been a labour economist for 20 years, I started thinking potentially I am missing some new logic in job creation strategies within the economic development literature, potentially the Tories have been hunkered down in their large underground economic labs and have designed some brand new policies that will shock and awe the global economy. Ontario’s economy and especially it’s labour market has yet to recover from the great recession in 2008 and nowhere in the world, save for China are we seeing economic growth rates that could match the job creation promises that Hudak is making to Ontario Voters. The question for Ontario- can you trust the fragility of the economy and our current jobs with such people who make such massive economic promises- yet produce such awkward economic plans with such disregard for detail, and flimsiness in ideas and intelligence?
So what can the outputs of the text analysis tell us. As you can see from the word cloud above, which sizes the words based upon count and somewhat on relations to one another a series of words have a high priority. From the word cloud health care, jobs, action, better jobs, economy, education and plan are all the most prevalent words in the Corpus. The data widget below allows one to browse through the list of words used in the Million Jobs plan posted on the Hudak website, so go ahead and have a look.
For a Jobs Plan that is supposed to create 1 million jobs- oddly enough, the term “health care” is the number one word in the derived corpus. In fact health care is mentioned more often than the word “jobs”. So one could potentially presume, given the focus on health care, the tories will grow their million jobs plan by a massive expansion of the health care system. Well that is actually not a bad idea- but that is not anywhere outlined or a focus. In fact there does not seem to be any focus within the document.
Another aspect of text mining that can be as informative as high word counts and sentiment analysis, is low word counts within a document. Typically within the economic development and jobs creation field words and ideas focus on Investment, innovation, skills, training, technology development, efficiency, productivity, but as one can deduce from the word corpus, these words are sparsely mentioned.
There are some other very glaring omissions in this document which undoubtedly cast a long shadow over the truisms behind the document, for example the word “women” is used just once within the document. Can you imagine, a massive job creation program where we know that in order to fulfill such promises, a lot of job creation would center on women, yet the word “women” is mentioned only once.
Also topping the list of infrequent words are “society”- used once. Also “union”, or “unions”, again only used once. It is pretty obvious that labour unions will not be part of any plan to create one million jobs, or potentially that will be one method, Hudak will elevate his obnoxious attacks on labour unions and working people.
We do know that he promises to fire over 100,000 public sector workers so I am sure that will involve a whole lot of attack on unions within the public sector and also women as it is within the public sector that women have made great strides in securing better wages and working conditions.
Textual analysis aside, Ontario faces a huge decision with the next election. We have never seen the economy, stuck in such decline and then stagnation over so long a period. Our manufacturing base has been in decline for almost a decade as the rise of the petro dollar pushed the cost of doing business above the longer term valuation of the dollar in terms of Purchasing Power Parity. Since the great recession, we have not had one year of healthy economic growth. And we still have many areas of the labour market stuck in recessionary areas, for example the long term unemployed are still near recessionary highs, part- time workers wanting full-time work and other underemployment aspects are still very close to recessionary highs, youth unemployment is painfully elevated and, low wage occupations are still among the highest in terms of job growth- (see CCPA Ontario Economic Report spring of 2013).
So what is it that must be accomplished to create jobs in the numbers that Hudak is promising. First and foremost, we would need to see a rise in family income. Consumers and their spending make up nearly 70% of the economic activity in Ontario. If one looks into the major causal economic forces that have large affect on household income, we can see that many of these are at some quite serious turning points.
1) Declining unionization rates in the private sector mainly due to economic restructuring and manufacturing job loss has resulted in stagnant wages in the private sector as verified by several studies. So as we shift from good jobs to more precarious jobs we will see more pressure to ratchet down wages and benefits or risk capital flight given the high dollar and the lack of innovation within the economy. Manufacturing and export growth are the backbone of the Ontario economy- and a good portion of that is linked to the auto sector. We know that investment is critical to modernize and expand production capacity here in Ontario. This is of course reliant on the US economy which is the largest market for our exports in Ontario. The challenge over the past several years has been the petro fueled dollar has place many manufacturers at a cost disadvantage due to the valuation of the dollar being hijacked by the petroleum industry rather than longer term processes like the Purchasing Power Parity of the economy. There have been several key major investments by the big three auto makers that have bypassed Ontario recently and went to US and Mexican locations. The Ontario government has to ensure we have a continuing healthy portion of the auto sector.
2) Low interest rates backed by more lenient lending terms have produced a consumer debt spending spree. As the housing bubble inflated over the past few years it has enabled a quick build up in home owner equity which has augmented work based income, and has created a debt fueled consumption explosion unlike any we have witnessed. As worker incomes have stagnated or declined home equity has piled up for those lucky enough to own a home and much of this build up in assets valuation has been extracted to keep the shortfalls in wages from impacting the consumption required to keep the economy rolling along. This is not sustainable as Canadian consumer debt levels hit some all time highs and many bankers, economic analysts have been warning policy makers. The fallout of from this housing bubble as a source of income is mainly premised on the rising real estate markets- the question right now for serious policy makers is not can we keep this housing bubble going, but can it be managed and slowly deflated rather than burst- as the fallout from a housing bubble bust was quite painful to our neighbour to the south. Obviously with the recent gains in real estate markets the banks are still lending- but for how long?? This has the potential to drive the entire Canadian economy into recession.
3) Government austerity- as we all know public services and government transfers are what keep a middle class robust and those at the lower end some help – yet after 30 years of neo-liberal cuts and now the austerity set in motion by the great recession and the tax cuts by recent right wing governments- the benefits of public sector services and income supports to the middle class have been in decline. Mainly due to tax cuts and focusing on deficit cutting and debt. This has actually resulted in lowering household income over the longer term through increasing costs of providing many of these former publicly provided services with private consumption and also the decreasing public transfers to every household reduced household income. An additional cost in the medium and longer term is the impact on households as reduced government investment into new schools, affordable education, highways and other public infrastructure produce social welfare loses as many public institutions struggle with lower budgets and less revenue. Basically by cutting away public services, through a series of tax cutting Tory policies initiated by the Harris government that allowed consumers to spend more on private consumption- we have basically been trading off new schools, education and better healthcare for new cars and bigger TVs. Not a healthy trade off when one is striving to meet the demands of building a high wage\ high innovation\high production economy. Standards of living rely on these social outcomes.
4) Demographics and aging- we obviously have more and more household incomes that will decline as people move into retirement. It was estimated recently that nearly 60% of retirees have no pension plan other than the CPP. So we will see a drop again in income, however as evidenced by recent labour market reports, seniors re-entering the waged workforce have been rising at almost double the normal rate- but at some age many of these elder workers will no longer have the ability to work and supplement their income.
5) A 30 year trend of increasing female participation rates in the waged economy has been what helped in a good part to keep household income robust and growing as wages for male workers fell and or jobs were lost. However we have now started reaching “peak women employment” which has many implications, as we have become so accustomed to more women entering the waged workforce. (see my website of a statistical analysis). So as women between the ages of 25 and 54 have reached an employment rate of nearly 77% and has flat lined for six years for the first time in 30 years- the added income from these women workers in the waged labour force will no longer have the impact on increasing household income.
So any plan that focuses on creating a million jobs, must focus on increasing household income in Ontario- yet if you look into the plan put forward by Hudak- much of what he outlines actually attacks household income- and if anything- his plan could actually push Ontario- which is in a very precarious economic position- into a recession. Instead of creating 1 million jobs- we could see the reverse and see Ontario decline into the economic backwaters of low wage, non-union, low productivity economic base located somewhere between the deep south States in US and the Mexican Border.