Alberta's Opportunity: The Ins, Outs and Benefits of Greater Job Mobility

Alberta's Opportunity: The Ins, Outs and Benefits of Greater Job Mobility

Publication
C.D. Howe Institute Commentary No. 580
Date

Study in Brief

Alberta should open its doors to job seekers with labour mobility reforms that will boost its economic fortunes post-COVID. The province has a unique opportunity to promote economic revival and longterm economic growth by ensuring that it is the most welcoming jurisdiction to talented workers and entrepreneurs from across Canada.

The gains from easing labour mobility restrictions are large. In this report, we find that for each 1,000 additional workers that move into Alberta in response to lower migration costs we estimate Alberta’s economy grows by 141 million dollars. And if migration costs fall by 1 percent across the board, we estimate gains of nearly 9 billion dollars. Better enabling Canadians to make this choice could provide a crucial support for Alberta’s economy at a time of transition.

Though other provinces would benefit from similarly reducing barriers to potential movers, both Alberta and Canada as a whole can gain from unilateral moves by the province to lower the costs for Canadians who might contemplate plying their trade, exercising their profession, or operating their business from Alberta.

Greater interprovincial mobility under a succession of regional and internal trade agreements has been beneficial and deepened the pool of workers available to Alberta. But obstacles remain for trades people and professionals who would come to Alberta. In particular, there are sometimes significant challenges to having their designation, training, or experience from other provinces seamlessly recognized. Recognizing those credentials, limiting the paperwork required of potential movers, and a more widespread recognition of national certifications and designations, such as those occurring under the Red Seal program, would enhance such mobility.

In addition, the study shows that there is a close connection between fostering increased labour mobility and lower barriers to trade in services. For each 1 percent reduction in the cost of importing services from other provinces, we find Alberta’s economy grows by nearly 0.1 percent. For a 10 percent reduction in services-trade costs, GDP gains approach 1 percent - equivalent to nearly 3.5 billion dollars per year.

The reforms we propose would facilitate mobility for employees and entrepreneurs alike. In short, when Canadians can move from one province to another with minimal barriers, the country as a whole benefits.

Avatar
Trevor Tombe
Associate Professor of Economics