Alicia Planincic: We don’t know how bad crime is in Canada. That’s a problem

In each EconMinute, Business Council of Alberta economist Alicia Planincic seeks to better understand the economic issues that matter to Canadians: from business competitiveness to housing affordability to living standards and our country’s lack of productivity growth. She strives to answer burning questions, tackle misconceptions, and uncover what’s really going on in the Canadian economy.

Over the last couple years, big-name retailers have pulled out of U.S. cities because of crime. That’s not just bad for business but for the community that’s left with less opportunity and, typically, more crime than before.

Though we haven’t seen major retailers leave Canadian cities due to crime, local businesses, especially small ones, are concerned. They increasingly cite crime as a challenge to stay in business, with some saying shoplifting is at its worst in decades.

Importantly, reports of violent crime are growing, and, by some accounts, so too is social disorder more generally. Altogether, there is a growing sense among businesses and Canadians at large that communities are unsafe.

But what’s interesting is official statistics of crime suggest that, though some types of crime have increased in recent years, it’s down significantly versus past decades.

For instance, the Crime Severity Index (CSI) which takes into account both the number of cases and the severity of crime reported by police has fallen by 24 percent over the last 20 years. According to this measure, crime is down widely across Canada, both in cities that have historically seen more crime (like Saskatoon) and those that have historically seen less (like Quebec City). Furthermore, many of the crimes that we’d think of historically as most directly affecting businesses and that account for a large portion of crime (e.g., petty theft, property crime) have decreased the most and remain near their 2019 levels.

So why might some businesses feel crime is at its worst in decades?

One possibility is that, though official reports of non-violent crime have increased only modestly in recent years, the true increase may be much bigger. This data relies on official reports by police, but things like shoplifting are said to be infrequently reported. Furthermore, as violent crime becomes more common, less serious incidents move to the bottom of law enforcement’s priority list and may therefore be less frequently reported to begin with.

Surveys of businesses and Canadians, combined with the increase in violent crime, suggest things may be worse than they appear. But whether other incidents of crime have increased much more sharply than the data suggest, we simply don’t know. And that’s a problem.

This post was originally published by the Business Council of Alberta at businesscouncilab.com.