Canadian Job Vacancies Hits A New Record, As 600,000 Positions Sit Empty
Canada has hundreds of thousands of unfilled jobs, despite elevated unemployment levels. BMO weighed in on the vacancy numbers, which jumped to an all-time high in Q1 2021. Robert Kavcic, the bank’s senior economist, estimates vacancies are now the size of 2.5% of the working population. Climbing unfilled jobs are attributed to lingering public health concerns, and unemployment benefits.
Canadian Job Vacancies Hit The Highest Level On Record
This morning’s job vacancy numbers increased to a record high, though the records don’t go very far back. The first quarter of 2021 had 600,000 unfilled jobs, once seasonally adjusted. Kavcic points out this is 2.5% of the working aged population (those between 15 and 64 years of age). It’s a lot of jobs to fill.
Source: BMO Economics.
“[it] rhymes with anecdotes that businesses are having trouble filling open positions. Vacancies are especially elevated across various sectors less hard-hit by the pandemic, such as construction, manufacturing and some areas of trade,” he said.
Lockdowns In The Second Quarter Likely “Tempered” Vacancies
The numbers are for the first quarter though, and may have tempered a little since then. The second quarter saw a number of cities reenter lockdowns. This led to additional business closures, and lowered business activity.
Restrained demand from closed businesses tapers demand for goods, and services. This turns into lower employment. At least in the short-term. BMO sees this as a temporary setback though, being fixed in the second half.
Worker Comfort (or Discomfort) May Leave Job Vacancies Unfilled
Whether employees are ready to come back to work, due to lingering social fears or crap pay, is the big question. “The outcome might depend on if generous support benefits get wound down; how comfortable Canadians are post-vaccination; and if households are willing to delay work and lean instead on accumulated savings,” he said.
The US is currently experiencing a similar situation. Employers are blaming generous unemployment benefits for competing with their pay. Job seekers argue wages should increase if unemployment benefits are competitive. Rather than employers increasing wages, half of US states plan to cut unemployment benefits.
Canada appears to be adopting a similar path as the US in this regard. The Canada Recovery Benefit (CRB), similar to the enhanced US unemployment, is currently planned to receive a 40% reduction to $300 per week. Unless those employees stacked some savings, the odds may favor employers. When the odds favor employers, wage growth does not favor the employee.
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