Structural Unemployment and Technical Change in Canada, 1990-1999

Timothy C. Sargent

Working Papers-Department of Finance Canada from Department of Finance Canada

Abstract: In this paper we examine the impact of technological change on unemployment and employment in Canada. We focus in particular on the argument that an increase in the pace of technological change has been responsible for Canada’s poor employment performance in the 1990s. We outline some economic models in which such a possibility could arise, and then examine a variety of labour market data for Canada to see whether the predictions from these models match the Canadian experience. We find that there is in fact little evidence that technological change had an important negative impact on overall unemployment and employment rates in Canada over the 1990s.

Dans cet article nous examinons l’impact d’un changement technologique sur le chômage et les emplois au Canada. Une attention particulière est portée sur le raisonnement selon lequel une augmentation de la vitesse du changement technologique est responsable de la faible performance de l’emploi au Canada dans les années 90. Nous décrivons quelques modèles économiques dans lesquels une telle possibilité pourrait se produire et ensuite examinons différentes données sur l’emploi au Canada afin de déterminer si les prédictions de ces modèles donnent une bonne représentation de la situation au Canada. Nous trouvons peu d’évidences selon lesquelles le changement technologique a eu un impact négatif sur le chômage et l’emploi au Canada durant les années 90.

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