CANADIAN JOB MARKET – Mini update Feb Mar 2011
In February Canada added 15,000 jobs which means 115,000 jobs added in Canada in the last three months. The unemployment rate stayed steady at 7.8%, same as last month.
The events of the past couple of months have had a significant impact on the markets … the tsunami and subsequent nuclear fears in Japan, coupled with the popular rising in the middle East have caused a fair bit of uncertainty, reflected throughout the markets.
Canada’s relative stability, resource based economy and recent performance through the recession makes it a fairly safe bet for investors … so the Canadian Dollar remains very strong, still close to parity and as we speak it is trading at 99c U.S. The TSX is down about 300 points at 13,718, from this time last month, which is not so bad given the world events! The price of oil means a lot to Canada’s Western economy and with it hovering around $100 a barrel and expected to be $116 a barrel this year the oil companies, and Canada’s Western economy, should have a good year.
For Eagle, February is normally a short month from a billing perspective and thus always impacts the revenue numbers. As expected the numbers were lower, however, we did see an increase in the number of billable resources which is indicative of a steady increase in demand for skilled resources. The number of orders from clients was also up about 10% over January, with approximately the same number of resumes coming in the door from people looking for work. All of this is consistent with a continued steady growth in resource demand in the marketplace.
The GTA(Greater Toronto Area) is the largest economic centre in Canada, has the most “head offices” and therefore can be expected to be a big demand market for people. In February (the) we saw an increase in the already heavy demand from our clients … with the financial services sector and telecommunications industries leading the charge. In addition, we are seeing an increase in demand from most industries, the system integrators, media, retail and insurance are some that are picking up the pace.
In Toronto we are reaching that “tipping point” where finding resources is becoming a major challenge, and with many people now receiving multiple offers … which shifts the balance of power a little. Clients need to make their decisions quickly if they want to get the best people.
The types of people in demand cover a broad spectrum, with a big demand for “niche” industry skills such as banking or telecommunications specialties, in addition to Architects, Business Analysts, Project Managers, Senior & Intermediate accounting staff and even an increase in demand for developers.
In Western Canada, as previously mentioned, the price of oil being almost $100/barrel means that many Calgary based companies have money to invest in their systems. This creates demand throughout the “systems” of suppliers, and ancillary companies supporting that economy. So Calgary is booming and Edmonton is busy, but expecting to get busier as a part of the booming oil economy. In Alberta, like Toronto, we are seeing the pendulum swing to being a market where the skilled resource can pick from several jobs. This makes it tough for companies to get the people they want unless they move very fast! February was a month were we started to see some signs of increased demand in the BC market too, a market that never seems to have the same torrid needs of a Calgary or Toronto but increased demand is always welcome . and a good sign that things in general are picking up.
Eagle’s Eastern Canada region is mostly Ottawa and Montreal, as we spend less time focused on the Maritimes … however we are seeing signs of increased demand for people in the Maritimes too. Ottawa is not extremely busy but there is a continuous demand as departments plan for the future and change their means of accessing resources. We saw a big shift at Canada Revenue Agency, with CGI the loser of a large contract and a number of small companies are now supplying contract resources there … which creates demand and activity. Montreal remains quite busy, and it is still largely driven by the financial services and telecommunications clients.
The following are some facts/indicators we are watching as of time of writing:
> The price of oil skyrocketed with the middle east disruption, and is currently at $100.80 a barrel, with a one year forecast of $116.
> At 13,718 the TSX lost about 300 points from last month’s reading of 14,027.
> The Canadian dollar continues to be strong and remains north of 99 cents US.
> Prime remains at 3% however there continues to be talk about when this will go up again!
> Canada added 15,000 jobs (322,000 in the last year) and the unemployment rate remained steady at 7.8%.
> Eagle experienced growth again in February, in the number of candidates applying, in the number of orders received from clients and in the number of people billing.
Canada’s economy, like any other in the 21stcentury, is affected by world events. If companies are doing well and feeling confident then they can invest, which creates jobs. Currently Canada is doing well on the world stage, is a stable economy as reflected in a strong dollar which continues to hover around parity with the US dollar (when we started Eagle it was about 60 cents US!). The unrest in the Middle East has affected oil prices which benefits Canada’s western economy resulting in investment in projects and jobs there, the largest market being Calgary but affecting most of the Western provinces.
All of this means that despite the terrible events in Japan and the upheaval across the Middle East, Canada is still in a recovery/growth mode. In fact, its two largest markets (Calgary and Toronto) are seeing very active demand and signs of skills shortages. The demand across all markets is generally up and we are moving from an “employer driven” market to an “employee driven’ market. Hence my “standing advice” to ANY company needing people (a) Start the process now with a strong PLANNING phase; (b) develop very clean processes to find, screen, choose, hire and onboard these new resources; and (c) know that you will have a lot of competition and therefore speed in decision making will be critical!
That was my monthly look at the Canadian job market and some of its influences.