Resulting income gains will help shield consumers from US slowdown

    TORONTO, Jan. 28 /CNW/ - CIBC (CM: TSX; NYSE) - The majority of jobs
created in Canada last year were in high-paying sectors, supporting an overall
upward trend in employment quality and personal income that bodes well for the
economy, notes a new report from CIBC World Markets.
    "Not only did the Canadian economy generate close to 400,000 new jobs in
2007, but the vast majority of them were in high-paying sectors," says
Benjamin Tal, Senior Economist at CIBC World Markets in his latest Employment
Quality Index (EQI) report.
    The index, which considers the distribution of part time and full time
jobs, compensation and other factors in over 100 industry groups, finished
2007 at an 18-month high and experienced the largest annual increase in
employment quality since 1999.
    "The number of full-time paid employees in high-paying sectors such as
public administration, computer services, and oil and gas extraction rose by a
strong 3.6% in 2007, while the number of jobs in low-paying sectors such as
general merchandize stores, textile and furniture manufacturing, in fact fell
by 1.2% during the year," adds Mr. Tal.
    Alberta and Saskatchewan led the quality parade in 2007, fuelled by
strong job gains in energy extraction and mining, sectors where earnings run
from 50 per cent to 125 per cent above the industrial average. Also notable is
Ontario's ranking as the second lowest on the index, which is "a clear
reflection of the difficulties facing the manufacturing sector in the
province."
    The Canadian findings contrast sharply with the U.S. "where the quality
of employment fell by 1.9% in 2007 and is now almost 12.5% below the level
seen earlier this decade," notes Mr. Tal.
    "It seems that in Canada, the loss of manufacturing jobs is being offset
by job gains in sectors with equivalent and higher employment quality. That's
not the case in the U.S. where the jobs now being lost in sectors such as
construction/real estate and manufacturing are being replaced by lower quality
jobs," says Mr. Tal.
    Looking ahead in 2008, Mr. Tal expects the employment quality trend to
lose some momentum in the first half the year. "However, we expect the level
of employment quality in Canada to remain elevated enough to support healthy
income gains and further shield consumers from the chill coming from south of
the border," says Mr. Tal.
    The complete CIBC World Markets report is available at:
http://research.cibcwm.com/economic_public/download/eqi-cda-20080128.pdf

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