The Canadian economy lost 43,000 jobs in June according to Statistics Canada’s monthly report1 released on July 8, 2022. The losses eliminate gains of 40,000 experienced a month earlier. This marks the first employment decline since the beginning of the pandemic that was not related to tightening health restrictions.
Despite the 0.2% reduction in jobs, the unemployment rate dipped to a record low of 4.9%. The seeming discrepancy comes as a result of a 0.4% decrease in the number of people who participated in the economy.
PEI and Manitoba saw job gains on the month, while Quebec and Newfoundland and Labrador saw their totals slide.
Service Sector Dips, Goods Producers Gain
The services producing sector lost 76,000 jobs in June, with retail being hardest hit. The coming months will tell us whether this was a one-off, or indicative of changing consumer behaviour in response to inflation.
Natural resources also shed jobs, down 20,000.
The goods producing sector, meanwhile, added 33,000 jobs, recouping the majority of the 41,000 jobs lost in May. The number of people working in construction grew by 23,000, while manufacturing jobs rose by 26,000.
Job Losses Amongst Those 55 and Older
There were 51,000 fewer people 55 and over employed in June, which accounts for the overall job losses. The employment rate for those aged 55 to 64 was lowest among First Nations people living off-reserve and Southeast Asian Canadians, while it was high for Arab Canadians and Filipino Canadians.
Self Employment Drops
There were 59,000 fewer self-employed workers in June, a decrease of 2.2%. Overall there are 249,000 less self-employed workers than there were in February 2020, before the pandemic began. June’s losses in this category may be attributable to high job vacancies and accelerated wage growth. Such conditions often entice self-employed individuals to become employees.
Work from Home Continues Slow Slide
Workers who usually work all of their hours at home fell 1.3% to 17.9% in June as workers returned to the workplace. This slide is partly attributable to seasonal spikes in accommodation and food service jobs, which cannot be performed remotely. Hybrid work increased by 0.4% to 6.7% in that same time period.
Among the 3.3 million employees who work most of their hours from home, 18% report to an office that is located in a region that they could not commute to on a daily basis. Moving forward it will be interesting to track the extent to which geography factors into employment decisions.
Wages Rise but Fail to Keep Pace with Cost of Living
Wages rose 5.2% year-over-year in June, eclipsing 3.9% and 3.3% year-over-year increases in May and April. The rises don’t necessarily equate to a higher standard of living, however, as the consumer price index has risen 7.7% year-over-year. Wage gains for employees without union coverage (6.1%) outpaced gains for those with union coverage (3.7%).
|Industry||June 2022 Change||May 2022 Change|
|Natural Resources ( Forestry, fishing, mining, quarrying, and oil and gas extraction)||-20.1||8.3|
|Transportation & Warehousing||11.2||-24.7|
|Finance & Insurance||3.8||-18.5|
|Wholesale & Retail Trade||-60.7||37.8|
|Professional, Scientific and Technical Services||5.9||20.5|
|Information, Culture and Recreation||-13.9||5.2|
|Accommodation & Food Services||-10.5||19.8|
|Business, Building & Other Support Services||4.5||12|
Figures displayed are Canada-wide and x 1000
American Companies Competing for Canadian Employees
Because of remote work capabilities, US companies are making a play for Canadian employees.
“We’re seeing it in places where it was never an issue before,” says Goldbeck President Henry Goldbeck. “They’re being hired for product management, strategic business development, and other strategic positions.”2
The trend is particularly predominant in the tech sector and is making recruiting and retention difficult for countries north of the border.
“Good candidates can easily work across the border and are being offered higher salaries than they’d get at home,” says Goldbeck. “Smaller Canadian companies are unable to compete with Bay area or L.A.-based companies.”
Impact of Inflation and Possible Recession on Jobs Market
As talk of an impending inflation intensifies, Goldbeck believes companies have not yet acted upon their fears.
“We haven’t had any positions cancelled because of that,” he says. “It’s mentioned, but nobody is acting as if it’s gonna happen. It’s not like people aren’t aware of it, but in terms of hiring, it hasn’t had an affect yet.”
Goldbeck doesn’t believe that soaring inflation is driving the market either.
“Salaries have increased because of supply and demand, not because of the cost of living,” he says. “Candidates aren’t thinking about inflation, they’re thinking ‘I have three other job offers that I can leverage for a higher salary’.”
Recruit and Retain Employees Through Meaningful Work and Benefits
In a recent Goldbeck white paper on the realities of working in the not-for-profit sector industry professionals explained that purpose-driven work and creative benefits allowed organizations to compete for talent that could potentially earn more salary elsewhere. Goldbeck believes that for-profit companies can learn from this approach.
“You don’t have to have a grand philanthropic mission, but your employees have to feel that they’re doing meaningful work and that they’re valued by the company,” says Goldbeck. “If people believe they’re making a difference in the company, that their team members care about and support them, and that they’re being treated honestly, those things have an impact.”
Goldbeck believes that companies who offer weak vacation or benefits packages may find it worthwhile to beef up their offering.
“The cost of an extra week of vacation may be worth a lot more than the equivalent cost in pay rate,” Goldbeck advises. “The same goes for benefits. The impact could be worth more than the dollar amount in terms of how employees think about their job and company.”
Will Ontario’s After Hours Legislation Become the Norm?
With Ontario passing legislation mandating companies to create written policies on after-hours employee disconnection, some observers expect other provinces to follow suit.
“It’s too bad they have to legislate that,” says Goldbeck. “Hopefully relationships become such that the regulation becomes a backstop, not the norm.”
While Goldbeck hasn’t seen the issue directly raised by any candidates yet, he believes that work from home will only become more entrenched, making this an increasingly key consideration.
“The privacy issues, with regards to monitoring people at home and when they’re allowed to turn off, will reflect on a company’s attitude towards their staff,” he says. “Ideally a company wants productivity and retention, while staff want work-life balance. If you’re feeling that big brother is there and that you can’t blow your nose or go grab another coffee, that’s going to affect morale.”