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Canada Labour Market and Employment Update, March 11, 2022

Canada Labour Market

The Canadian labour market increased jobs to pre-pandemic levels in February. Employers did this by adding 337,000 jobs across the country. Factors contributing to the economic surge in jobs recovery included Health authorities relaxed Omicron restrictions based on case count and hospitalization trends. This relaxation enabled employers to open more services and increase operating levels, permitting them to hire and rehire workers on layoffs. 
Public places and spaces open up. Services sectors surged, accounting for much of the gains. This trend is clearly reflected in a 12.6% month-over-month employment increase in the following sectors: 

Private Sector Leads the Way in the Canada Labour Market

Private sector-led growth accounted for 347,000 jobs added in the Canadian labour market. These gains were not evenly distributed, with a high proportion of growth experienced in Ontario and Quebec and prairie provinces lagging in recovery with higher unemployment rates.
Meanwhile, public sector employment levels remain flat. This trend makes sense as public sector employment remained steady during the pandemic and did not experience the layoffs many in the private sector experienced.

Self-Employment Cools 

After an initial surge of increased self-employment, many Canadians realize the self-employment life is not for them or as fruitful as imagined. They revert to seeking more traditional employment opportunities.

Canada Labour Market Equity Improves But Gaps Remain

Canada’s labour market achieved record-high employment participation rates for core working-age women, and Indigenous and BIPOC populations, but equity gaps remain.
However, older workers are not experiencing the jobs gain recovery and risk being left behind as the employment market transitions, changing skill requirements, and ageism takes a toll on opportunities for this demographic.

No Great Resignation in Canada 

Unlike in the United States, mass resignations are not expected in Canada’s labour market, as employees and employers return to work in on-premise, remote or hybrid formats. Employers take a thoughtful approach, offering options and time to adjust to proposed changes.

The Implications 

These factors impact the Canada Labour Market in many ways, including adding uncertainty among employees, confusion among recruiters, frustration among hiring managers, and increased risk for employers.

Employees notice their purchasing power shrink and consume news with mixed or nuanced messages about inflation. Messages surrounding the causes of inflation are politically torqued with a spin—objective and unbiased information on the topic is challenging to find. Anxiety is created not only by actual and perceived loss but also by a fear of missing out as news of a tight-labour market comes from loud and vocal stakeholders. Employees agonize over whether they have pressed hard enough to get more favourable terms with their employer and in the labour market. Speculation over the expected length and extent of current inflation levels creates more uncertainty about what people should pursue and how they should position themselves to navigate these conditions.

Recruiters receive cold responses and combative candidates with aggressive positions regarding salary expectations. There is movement in the market, and a mismatch of skills, uncertainty, and physical isolation create communication challenges during the exchanges. As recruiters fall short of meeting fill rates, they seek to increase terms and conditions. Increased rates do not create more candidates when looking in the wrong places. Increased rates do create structural costs increases for businesses.

Hiring managers are frustrated by difficulty managing budgets and risk and delays in recruiting, and employees with demands at times with overtures to leave.

Employers face increased input costs, downward price pressure, uncertain financials, and rough market conditions. The Canada Labour Market, if approached without foresight and sophistication by employers, recruiters and hiring managers, has the potential to exacerbate inflationary pressures as what occurred in the United States. 

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(c) Workforce Delivery Inc. 2020