Issue information

Canada's oil reserves are concentrated in three Canadian provinces: Alberta, Saskatchewan, and Newfoundland and Labrador. Oil prices received by Canadian oil producers more than doubled between 2001 and 2008. The proportion of young men employed in the oil industry differs markedly across provinces and education levels. Taken together, these facts suggest that the increases in world oil prices observed between 2001 and 2008 may have induced cross-educational and cross-provincial variation in labour demand and male wage growth in Canada. Using data from the Canadian Labour Force Survey, this study exploits this variation in wage growth in order to estimate the elasticity of young men's labour market participation and school enrollment with respect to wages.