Although not much has changed in the most recent Statistics Canada April 2022 Labour Report, Canadian employment has grown yet again. Setting new all-time highs for employment and lows for unemployment during a time when businesses are struggling to retain and attract talent.
We have been in an increasingly tight labour market for months now, and while every month Canadian workers shatter employment records there doesn’t seem to be any end in sight. “All of these indicators that we look at tell the same story, and that is a story of a shrinking labour pool and an overheated labour market,” Tu Nguyen, an economist with accounting and consultancy firm RSM Canada, told The Canadian Press.
Indeed, the pool of available and ready-to-work talent has shrunk substantially. After reaching a record low of 5.3% unemployment rate in March, the rate edged down even further by 0.1% — a small change, but still a brand-new record. Additionally, the unemployment rate for the core-aged working population (25-54) fell from 0.2% to 4.3% in April — the lowest recorded rate since comparable data became available in 1976.
On top of these record-breaking unemployment lows, the involuntary part-time employment rate has also hit a record-breaking low of 15.7%. This is particularly interesting, considering the involuntary part-time employment rate peaked in August 2020 at 26.5%, as many workers faced challenges securing full-time employment. Traditionally this talent pool holds a great deal of opportunity for recruiters, as involuntary part-time employees are both proven candidates and ready to make a move.
As these two talent pools primed with ready-to-work and capable resources dwindle, recruiters need to be more creative and active in sourcing and connecting with passive candidates — those who are currently employed and not looking to move.
This incredibly tight labour market has left many employers wondering how they can keep up with attracting and retaining top talent, and unfortunately, there is no simple solution. While many companies have turned to wage increases to keep up, there comes a point where the level of wage growth becomes simply unsustainable.
As of April, nearly one in four employees in Canada earns $40 or more per hour. This is an increase of 1.2 million workers from April 2019. Similarly, as of last month, there are 1.3 million fewer employees with hourly wages of less than $20 – making up another quarter of all employees in Canada.
While this overall wage increase for Canadians seems positive at first glance, there are major implications for Canadians’ wallets the longer inflation remains elevated. Basically, while Canadians are making more, they’re also spending more for less on a regular basis.
“It’s important for organizations to offer competitive wages in a tight labour market,” says Agilus CEO, Craig Brown. “Investing in talent is bigger than just compensation, employee benefits, Work+Life balance, corporate culture, and ultimately your overall Employee Value Proposition (EVP) also need to be at the forefront of your strategy to attract great talent.
“For the first time, we have five generations in the workforce,” Brown points out. “That means it’s practically impossible for one piece of your company’s EVP to entice 100% of all potential employees. Employees need a diverse offering of benefits beyond the basics in order to stand out in this increasingly competitive job market.”
We’re helping hundreds of companies across all industries and skill sets navigate these new workforce challenges. Contact our team today to learn how we can support your business’ employment needs. In the meantime, want to learn more about what your company can do to attract workers during this tight labour market? Download The Talent Squeeze and The Future of Work white papers here.