Labour Adjustment Implications of Service Offshoring: Evidence from Canada


  • Rafael Gomez and Morley Gunderson are at the University of Toronto. René Morissette is at Statistics Canada.

  • The views expressed in this article do not represent the views of Statistics Canada.


About one-fifth of Canadian employees are in jobs that are vulnerable to service offshoring. Despite this figure, both theory and our empirical evidence (based on a variety of methodologies and datasets) suggest that the offshoring of business services is not likely to lead to large adverse employment effects. We also conclude that existing active labour market adjustment policies (e.g. increased labour market information, job search, mobility and training) developed for other adjustment pressures such as technological change and free-trade in goods are just as appropriate (perhaps even more so) to deal with the consequences of service offshoring.