There’s been job growth in the region, but employers in some sectors continue to struggle with hiring, not immune from the trend.
The unemployment rate was 6.5 per cent in October, down from 7.1 per cent the month before. The number of unemployed fell by 1,800, with some 3,000 people returning to the labour market, according to the Workforce Planning Board of Waterloo Region.
As well, more people are working or seeking work, with Waterloo Region hitting a 2021 participation rate high of 69.8 per cent.
Still, many employers report they’re have trouble finding workers. That’s especially true in the service sector, particularly the hospitality industry.
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“We’re seeing a number of employers who are looking for workers, and there are some very big challenges that are happening at this point. I don’t think there’s an industry that isn’t hiring right now,” said Charlene Hofbauer, executive director of the Workforce Planning Board.
While employment numbers are returning to pre-pandemic levels, there are a number of differences in today’s job market, she said. Many employees are looking for more from their jobs.
“A lot of our numbers that we’re looking at, they look a lot like our pre-pandemic numbers. We’re getting really close to where we were participation-wise, we’re getting really close to our unemployment rate. But it’s a very different labour market for job seekers and for employers because the pandemic has changed some stuff.”
Beyond an increase in wages, employees now are more concerned with working conditions and work-life balance issues, said Hofbauer.
That trend is reflected in a new survey commissioned by ADP Canada for Small Business Month that finds 46 per cent of small businesses owners and operators who say hiring in the current environment is difficult have increased wages, 27 per cent have increased benefits such as additional vacation time, and 19 per cent have introduced a shorter work week.
Any wage increases have yet to be widely reflected in the data for Canada, unlike the news coming out of the United States, where there is upward pressure on wages, large shortages in some sectors and people leaving their jobs or opting not to return, a trend known as the Great Resignation. That’s just not the case here, says University of Waterloo economist Mikal Skuterud.
“U.S. media coverage of the U.S. economy tends to spill over to Canada, and some of those narratives are taken on by Canadians as being true for Canada. Right now, there are actually a number of developments that appear to be playing out in the U.S. that are not playing out in Canada. One of them is this evidence that we’re seeing in the U.S. of increasing wages, particularly at the lower end of the labour market – lower-skilled jobs in the U.S. are seeing some pretty big wage gains – but there is no evidence of that in Canada,” said Skuterud.
“I have not seen yet any evidence of wage pressures anywhere in the wage distribution in Canada despite the fact that we are seeing tight labour markets, measured using the ratio of job vacancies per job seeker.”
That measure is at an historic high, though not much above the pre-pandemic level, he added, saying he prefers to refer to the issue as a tightness in the labour market rather than a labour shortage, which has a negative connotation.
In fact, that can be a good for the economy, he stressed.
“If I’m a worker seeking work in a tight labour market, I’m not a loser, I’m a big winner – that’s a good thing for me. So I would say tight labour markets can be something to celebrate, and probably should be. They do a lot of really good things: they tend to boost wages for workers, they tend to increase productivity, because employers have to find ways to use labour more efficiently.”
For workers, the market sees a boom-bust cycle, with situations such as what we’re seeing now being an opportunity to seek new jobs in other fields, do some retraining and learn new skills, for instance.
“This is all really positive stuff for the economy. In tight labour markets that are tight at the lower end for lower-skilled workers, it tends to reduce inequality,” said Skuterud.
That may mean adjustments for employers, particularly those in sectors where filling vacancies is the most difficult, including the hospitality industry.
“It will be challenging for some employers, yes. And it will be, for some industries, a little bit more challenging,” said Hofbauer. “That’s where it’s so important to onboard people properly – once you hire them – you get them through the door – you’ve got to focus now on keeping them, and I think that where employers have the opportunity to look at how they’re doing things and do it differently.”