Halifax workers make less than workers in nearby cities

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Appeared in the Macdonald Notebook, December 20, 2023
Halifax workers make less than workers in nearby cities

Halifax’s recent growth spurt is good news. In the five years preceding the pandemic (2014 to 2019), Halifax’s economy grew by 22 per cent. But while growth undoubtedly brings many benefits, a closer look at the economic data shows that the city still trails most other big cities on important measures of economic well-being including income levels for workers. So the good news about Halifax’s growth could have been better.

For example, according to a recent study, median employment income—an important measure of labour market health because it strips out government transfers and passive income from investments—in Halifax was $38,084 in 2019 (the latest year of non-pandemic influenced data). While this is slightly higher than Fredericton, Saint John and Moncton, it trails all other 16 cities across Atlantic Canada and New England.

For example, after adjusting for currency differences, the median employment income was 31 per cent higher in Portland, Maine ($49,876), 38 per cent higher in Manchester, New Hampshire ($52,681) and 62 per cent higher in Boston ($61,793). In other words, workers in most other cities in region, on both sides of the border, make more than workers in Halifax.

Moreover, these large gaps with big nearby U.S. cities generally grew during the 2010s. From 2010 to 2019, Halifax experienced compounded employment income growth of just 0.2 per cent per year, tied for fourth-lowest among 20 jurisdictions in Atlantic Canada and New England. This trails Saint John and Moncton (0.3 per cent), St. John’s (0.7 per cent) and most cities in New England.

Obviously, an employment income gap of thousands of dollars per year can make a big difference for living standards and quality of life. And as long as growth rates in Halifax continue to trail other cities in the region, this gap will continue to grow.

To be sure, Halifax’s recent economic growth is an important development. However, it would be a mistake to be complacent about the state of the economy. When we move beyond top-line numbers and look at comparisons of labour market statistics at the city level, we see things in a different light. The data clearly show that despite Halifax’s recent growth, most nearby big cities in New England have a substantially higher level of employment income. And the gap grew over the course of the 2010s.

Haligonians needn’t accept this income gap as permanent, and they should push their elected officials to help close this gap through stronger government policies. When income levels in Halifax rise closer to levels in other nearby big cities, that will be good news for workers.

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