Employment in Canada was up for the third month in a row, adding 28,000 new jobs. The big gains came in Ontario and Alberta, with Quebec and Newfoundland actually losing ground. Overall the unemployment rate stayed steady at 7.4%, and Canada has now added 238,000 jobs in the last twelve months.
The Canada Dollar remains strong at $1.03 US, which is nice this time of year for Canadians vacationing abroad, but probably is not helpful to Canada’s tourism industry. The world markets continue to be very volatile with Greece, Italy and the US economies all getting a lot of press recently. This uncertainty affects the markets and companies willingness to invest in growth. This month the TSX reading is about 380 points higher than last month, at 13,324 versus 12,964 a month ago … although that is a point in time and on any given day lately there have been some big swings! The price of oil remains high, currently sitting at $97.99 a barrel, but environmental concerns due to a number of recent leaks will affect this price and the industry’s ability to take full advantage of what should be a strong period. Having said that, Alberta is still one of the strongest job markets in Canada.
Here at Eagle, June saw a continued, if small, increase in demand from our clients, after a healthy growth in demand the previous month.
At the risk of sounding like a broken record, the GTA (Greater Toronto Area) is the hottest job market in Canada. Demand remains high across a number of industry sectors, with the financial services sector leading the way, but the telecommunications industry, utilities companies and retail all busy too. The one area that is a little slower, with an Ontario election due in the fall, is government … but that sector traditionally slows somewhat in the summer anyway. The one exception is the Health sector which continue to invest in its future. There is some slowing in the hiring process as we deal with vacationing decision makers, but overall there does not seem to be a slowdown in demand for resources across a broad range of skills, with an emphasis on specialists, senior resources, strategic resources and/or very strong generalists.
The Western Canada markets are all continuing to show demand, with Calgary quickly heading back towards the heady pre-recession days of labour shortages … although we are not quite there yet. The oil sector has enjoyed a good run of strong oil prices, although that has been tempered by some fallout from the “gulf spill” and some more recent smaller, but high profile oil spills. Nevertheless there is investment happening in systems which is driving up demand in that sector … and all of the sectors that feed the oil companies. The oil sector’s reach provides a positive impact beyond Calgary, to Edmonton fueled by oil taxes and to British Columbia and Saskatchewan which have their own oil sectors. Therefore while these markets are smaller than the Calgary market they do present some opportunity for job growth.
Eagle’s Eastern Canada region is mostly Ottawa and Montreal, with some demand driven from the Maritimes. The Maritimes and Quebec were the areas that lost jobs this month, primarily due to seasonal impacts. Montreal is however quite busy, with the financial sector in particular showing significant demand for skilled resources. In Ottawa, the Federal government continues to be relatively quiet as we await some word on major initiatives such as technology renewal and shared services in addition to some cost cutting initiatives. Industry is hopeful that the work will start to flow in the fall, meantime we have a slow summer period.
The following are some facts/indicators we are watching as of time of writing:
> the price of oil remains high at $97.99 a barrel.
> The TSX gained about 380 points this month (after losing 700 points last month) showing a current reading of 13,324.
> The Canadian dollar remains strong at $1.03 US, the same as last couple of months.
> Prime remains at 3% and is expected to remain steady through to the fall.
> Canada’s employment numbers improved for the third month in a row with 28,000 new jobs, but no change in the unemployment rate at 7.4%.
> Eagle continues to be busy in its largest markets Toronto and Calgary with steady business in most other markets.
June continued with that same trend we have seen since the recovery started, slow and steady with as much chance of going back a pace before continuing. The Greater Toronto Area and Calgary continue to be the “big demand” markets for skilled resources, with most other markets increasing demand very slowly. There are a number of factors affecting the optimism needed for Canadian companies to open the floodgates … the oil patch continues to “wear” the results of the gulf oil spill, followed by a number of small mishaps; the financial markets falter due to various economies such as Greece, and this month Italy causing consternation with their instability; Canada’s largest trading partner the USA is itself having serious economic troubles, highlighted by its potential inability to meet its obligations early in August without some legislative change! All of these factors are causing a risk adverse feeling among both investors and executives at large companies. As economies continue to recover we can expect the floodgates to open up in demand for labour … which will cause a whole new set of problems, with exacerbated skills shortages, together with labour shortages.
In the hottest markets (GTA and Calgary) we continue to see the signs of skills shortages, with increased instances of candidates having many offers from which to choose and contractors who had taken full-time jobs during the recession moving back to contracting. We have also noticed an increased demand for procurement resources in many locations, which is usually an indicator of coming demand. One other trend we can comment on is that clients are having a tough time adjusting their rate expectations when ‘high demand” resources are involved … a typical reaction when markets are mid-swing between “cold” and “hot”.
As usual I will end this write up with 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;
(c) Know that you will have a lot of competition and therefore speed in decision making will be critical;
(d) The job doesn’t stop there … retention becomes the next challenge!
That was my monthly look at the Canadian job market and some of its influences.