CALGARY – Western Canadian provinces recorded the best performing labour markets in Canada between 2005 and 2009, led by Alberta and Saskatchewan, according to a new study released Thursday by the Fraser Institute.

The report said Alberta topped all provinces and American states, in the ranking reported in Measuring Labour Markets in Canada and the United States: 2010 Edition. The province recorded the highest level of employment growth over the five-year span that was measured, along with high levels of employment growth in the private sector and low durations of unemployment.

Saskatchewan recorded the second-best performing labour market in Canada and third overall in North America. British Columbia is ranked third in Canada, sixth in North America, with Manitoba ranking fourth in Canada and eighth overall.

"The main factor is Alberta's investment climate - the fact that Alberta has among the provinces the best policies to attract investment and therefore the best policies that create jobs, lower, unemployment, increased productivity and all of the things that go into a high-performing labour market," said Niels Veldhuis, Fraser Institute vice-president of Canadian policy research and co-author of the study.

The report said Alberta's strong performance in total employment growth (first out of 60 jurisdictions), employment growth in the private sector (2nd), low duration of unemployment (1st), and average labour productivity (3rd) were the reasons for its lofty ranking.

The most recent labour data in the province showed the unemployment rate in Alberta had fallen to 6.3 per cent in July from 7.2 per cent in July 2009. In the past year, employment in the province increased by 24,000 people and the labour force increased by 4,600 people.

Thomas Lukaszuk, Alberta's Minister of Employment and Immigration, said the report indicates the province has its economic fundamentals on the right track.

"It reaffirms what we in Alberta knew intuitively and what other variables were indicating to us," he said. "The fact is that even during the time of global recession western provinces, and in particular Alberta and Saskatchewan, were still considered to be beacons in prosperity. And you saw that in unemployment rates, you saw that in internal migration within the country, you saw that in employment rates and now recently you saw it in the rate of recovery."

Alaska was the top ranked American state, second overall behind only Alberta.

mtoneguzzi@theherald.canwest.com