Labour shortages continue as quarterly job vacancies reach 'all-time high'

Job vacancies in Canada reached an "all-time high" of 912,600 in the third quarter of 2021, a trend driven largely by certain sectors such as health care, food and retail, a recent report from Statistics Canada shows.

The number of job vacancies across all sectors is more than 349,700, or 62.1 per cent, higher compared to the same period in 2019.

The job vacancy rate, defined as the number of vacancies as a proportion of labour demand, in the third quarter of 2021 also stood at a record high 5.4 per cent, or 2.1 points higher from the same period two years ago.

Vacancies were up in all provinces, with the largest increases reported in Saskatchewan, Quebec and Ontario. Nova Scotia had the smallest increase in vacancies.

"The record-high job vacancies observed in recent months has focused attention on the extent to which unmet labour demand will contribute to upward pressure on wages," StatCan writes in its job vacancy report.

The number of job vacancies in the most recent quarter marks a dramatic shift, not just for 2021 but dating back at least six years. Additional data from StatCan shows that from 2015 on, quarterly job vacancies have fallen within the 300,000-500,000 range, although figures aren't available for mid-2020.

The agency notes that the record high comes amid growing overall employment and falling unemployment.

The agency reported an increase in employment in November of 186,000, or one per cent, compared to pre-COVID levels in February 2020. Unemployment also fell to six per cent last month, bringing it within 0.3 percentage points of February 2020.

The news also comes after StatCan reported record high job vacancies in the second quarter of 2021 of 731,900, up 25.8 per cent from the same period in 2019 and with similar industries affected. Two years before that, vacancies increased by 26.5 per cent from the second quarter of 2017.

INDUSTRIES AFFECTED

Five sectors — accommodation and food services, health care and social assistance, construction, retail trade, and manufacturing — accounted for two-thirds of the increase in vacancies.

The only sectors where vacancies didn’t increase compared to the same period in 2019 were agriculture, forestry, fishing and hunting, as well as real estate and rental and leasing.

"Increases in job vacancies can signal a number of changes in labour market conditions existing in different sectors and regions," the StatCan report says.

In health care and social assistance, for example, although job vacancies were up, payroll employment, or the number of employees receiving pay or benefits, reached pre-COVID levels in December 2020.

StatCan suggests this indicates that the sector faced challenges trying to meet labour demands amid increased economic activity. The occupations with the most vacancies included nurse aides, orderlies, patient service associates, registered nurses and registered psychiatric nurses.

"Prior to the unprecedented demands placed on the health-care system by the pandemic, employment in the sector had been increasing steadily since the third quarter of 2017, partly the result of an aging population," the report says.

The situation was different in construction, where payroll employment saw little change, suggesting increased vacancies were due, in part, to shortages of specific skills or "geographic mismatches" between vacant positions and the number of workers able to fill them.

In accommodation and food services, retail trade, and manufacturing, StatCan reports that payroll employment was actually lower compared to two years go.

"This suggests that businesses were working to fill vacant positions as they reopened or as operations resumed during the third quarter of 2021," the report says, adding labour demand in accommodation and food typically peaks during the summer.

Shifting demands from employers looking for specific skill sets also may be influencing certain vacancies.

WAGES

Job vacancies were more pronounced in occupations with the lowest average wages.

Despite accounting for 32.3 per cent of employees, low-wage jobs made up 50.9 per cent of vacancies.

This is compared to occupations with the highest average wages, which saw an overall drop of 1.1 points to their share of all vacancies from two years earlier, or 9.4 per cent.

Of the 373 occupations listed in the National Occupational Classification, which groups jobs based on duties and work done, 155 saw average offered wages exceed the Consumer Price Index, which rose by 4.3 per cent between 2019 and 2021.

Among the occupations that saw the highest increase in vacancies — constructions trades helpers and labourers, cooks, retail salespersons, nurse aides, orderlies and patient service associates — average offered wages increased the most at 9.7 per cent.

Average offered hourly wages for vacant positions in health care and social assistance, as well as accommodation and food services, also rose by 4.9 and 6.6 per cent to $24.75 and $15.30 respectively.

On average, offered wages rose higher for lower-skilled jobs than higher-skilled ones.

A more recent analysis found that nationally, average weekly earnings were 8.5 per cent higher in October than in February 2020, at $1,134.

Canadian employers actively recruited for an estimated 964,300 job vacancies in October, while in September 1,014,600 vacancies needed to be filled, the highest for any month since comparable data became available, although StatCan notes that this isn't seasonally adjusted.