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Migration within Western Canada will help keep job market balanced

It's a story as old as the country itself: People packing up their belongings, moving to find a job and building a better life. Economists even have a special term for it: labour mobility. Relocating to find work can be a painful and unwelcome experience, both for individuals as well as the communities they're forced to leave. But as disruptive as it can be, labour mobility is critical to a well-functioning economy, particularly one as large and diverse as Canada.

The truth is that every non-aboriginal person in Canada has some connection to labour mobility, even if the migration was made generations ago. The economy of modern-day Canada has been built on the backs – and increasingly, within the brains – of immigrants.

But new immigrants to Canada are not the only source of labour; the steady flow of job seekers back and forth across provincial borders has also played a very important role. When thinking about labour migration within Canada, the steady out-migration from Atlantic Canada that has been trending for decades comes immediately to mind.

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But in fact, the most mobile job seekers within their region aren't in the East. They're in the West.

Over the past complete 10 years ended April 1, 2015, nearly 867,000 people in Western Canada migrated from one western province to another. That figure does include some double counting, as someone might move from Saskatchewan to British Columbia one year, and then move home again a year or two later. But in relative terms, it's a significant number. It means that over the past decade, almost 8 per cent of Western Canada's total population at some point or other relocated within the West.

Intraregional migration is proportionately much less in the other regions of the country. Made up of the two largest provinces, Central Canada showed far less intraregional migration. Only 1.3 per cent of the population relocated across the Ontario-Quebec border over the same 10-year period. The figure is a bit higher within Atlantic Canada, where almost 4 per cent of the population moved within the region.

Of course, Canadians do move outside of their geographic region as well. Migration from the East Coast to other parts of the country has been significant. Almost 6 per cent of the population of the four Atlantic provinces relocated to Central Canada. Even more (7.4 per cent) left the East for the West. And while less than 1 per cent left Central Canada for the East, 2.6 per cent of them headed West.

Still, in percentage terms, there has been significantly more intraregional migration within Western Canada than there has been within any other region of the country.

If this trend continues in 2015 and beyond – and there's no reason to believe that it won't – it will be enormously helpful in containing the labour market disruption bearing down on Alberta this year. With the petroleum sector in another one of its periodic downturns, job seekers in the formerly hottest labour market in the country will be encouraged to find work in one of the other three western provinces.

And fortunately for many of Alberta's potential job seekers, British Columbia is forecast to have the hottest economy in the country next year. Most forecasters peg real gross domestic product growth on the West Coast to be between 2.5 and 3.0 per cent next year. That compares to expected economic growth of close to zero for Alberta.

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Migration back and forth between B.C. and Alberta far exceeds the flow between any two other provinces. The impressive physical barrier of the Rocky Mountains hasn't impeded the more than 450,000 people who have moved between the two westernmost provinces over the past decade.

The slowdown in Alberta and the acceleration in B.C. should result in another swing of the migration pendulum next year –this time back to B.C. The migration will help lower the size of the labour market in Alberta as job seekers are likely to find attractive opportunities in B.C. That will stem the rising unemployment rate in Alberta and maintain some balance in a labour market that is certain to struggle next year.

Of course, Albertans don't like the idea of watching their friends and neighbours leave for B.C., but we are comforted by the fact that history repeats itself. They'll be back before too long.

Todd Hirsch is the Calgary-based chief economist of ATB Financial and author of The Boiling Frog Dilemma: Saving Canada from Economic Decline.

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