As Canada continues its post-COVID recovery efforts, the labor market has seen persistent job vacancies in certain industries despite increased payroll employment. In December 2022, job vacancies decreased slightly to 848,000, while 91,400 positions were filled. However, certain sectors continue to struggle with labor shortages, with health care and social assistance being the most affected.
Health Care and Social Assistance: A Sector in Need
The health care and social assistance industry in Canada continues to face a shortage of workers, as the number of vacancies increased by 18,200 positions in December 2022. This increase almost offset the 19,400 workers hired in November. The total number of job vacancies in the sector stood at 149,800, the highest of any sector in Canada. Despite a net growth of 190,600 jobs in the last two years, the industry has seen little change in overall vacancies, indicating high demand for these workers.
Construction: Consistent Gains in Payroll Employment, Persistent Vacancies
Canada's construction industry saw consistent gains in payroll employment in the last four consecutive months but continues to face persistent vacancies. The total number of open positions has remained largely unchanged from November 2022, at 79,000 vacancies, and increased from December 2021 (61,800). This highlights both increased demand and labour issues in the construction industry.
Hiring Increases in Key Sectors
In December 2022, the health care and social assistance, finance and insurance, and construction sectors saw the most hiring in Canada. Of note, two of the sectors with the most payroll employment growth (health care and construction) are also leaders in job vacancies in Canada, suggesting that the persistent lack of workers is a key driver of the rising immigration numbers forecasted in the coming years. The payroll employment reported by these sectors made up the bulk of gains in employment for their respective industries.
Provincial Employment Increases
Quebec, Ontario, British Columbia, and Alberta reported the most payroll employment increases in December 2022. Newfoundland and Labrador, however, saw a slight decrease in payroll employment, highlighting the fragility of Canada's post-COVID recovery efforts.
Labor Shortages: A Threat to Canada's Economic Health
While the employment increases in December 2022 are encouraging, they are relatively small compared to the number of vacancies that need to be filled to ensure Canada's continued economic health. The persistent labour shortages in key sectors, such as health care and construction, pose significant challenges to Canada's economic recovery efforts.
Investment in the Construction Industry
Despite persistent vacancies in the construction industry, investment in non-residential construction has seen consistent growth of close to $600 million CAD in the last year. This is a promising sign for the industry as economic activity picks up in Canada.
Immigration Policies to Address Labour Shortages
To address the labor shortages in the health care and social assistance sector, the Canadian government has backed the industry with favorable immigration policies. Immigration Refugees and Citizenship Canada (IRCC) has recently removed barriers for physicians to apply for Express Entry, increased the ability of foreign-trained medical professionals to become accredited and work in the country and cut the work experience requirement for permanent residence eligibility for caregivers in half.
Canada's post-COVID recovery efforts continue to be stymied by persistent labor shortages in key sectors, with health care and social assistance being the most affected. While certain industries have seen increased payroll employment, job vacancies remain high, posing challenges to Canada's economic health. Investment in non-residential construction and favorable immigration policies for the health care and social assistance industry provide promising signs for the future.
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