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From a job market perspective, the fourth quarter of 2012 here in Canada was very similar to the rest of 2012 ... decent performance, but not booming. The Canadian economy continued to perform well in comparison to other countries but we are by no means seeing a boom as we are affected by lagging economies around the world. The TSX is one interesting indicator of how Canada's economy is faring and in 2012 we saw it hit lows around 10,800 and with a reading of 12,700 as I write, the index is as high as it was at any point in 2012. Other good news in December saw Canada add 40,000 jobs, resulting in 312,000 more jobs since December 2011, and hit a four year low unemployment rate of 7.1%.
After a fairly robust year in Western Canada, November and December slowed down fairly significantly. With the price of a barrel of oil currently above $94, the Western Canada economy remains a strong job market. Busy oil companies means that the companies serving that sector also benefit, which includes the governments that collect those tax dollars, creating opportunity there too. The demand for people has not yet returned to pre-recession levels, but a strong Canadian dollar, uncertainty in world markets and political influences (Keystone decision in the US, environmental pressures, Middle East upheaval etc.) are probably the biggest factor there. The gas industry remains depressed due to low natural gas prices, which means that there is no great demand for people in this sector. Should all of those factors align in the future we would see the current "skills gap" become a full on labour shortage in Western Canada specifically. Here at Eagle we were surprised to see client demand reduce by half in the last couple of months in 2012, but demand seems to have picked up again in January. By way of explanation there were 13 changes at the CEO/CIO level in Calgary alone during Q4, plus several companies experienced fairly significant downsizing. These events will cause disruption in hiring but we expect projects to get going and demand to increase early in 2013.
The banking sector has been very strong in 2012 and finished the year in that mode. There is strong demand across the banks for skilled resources as they develop new systems for regulatory and competitive reasons, improve operations and integrate acquisitions. This demand is created at head office locations, so these jobs are typically in Toronto, and to a lesser but still significant degree, Montreal.
The telecommunications sector is a very competitive one and all the telcos have been busy investing in new services and products, in addition to ensuring their infrastructure is sound. This has created significant job opportunities, with Toronto, Ottawa and Montreal the markets that have most benefitted.
The construction industry continues to create huge demands for people. The number of busy construction sites across the major cities is a clear indicator, but there is also the restoration/renovation work driving demand as anyone who has tried to find tradespeople will know. The trades remain a great opportunity for people thinking about a career, or even a career change.
Federal, provincial and municipal governments will always have a need for people. The current climate of cost cutting, revisiting budgets, scrutiny from auditors and watchdogs makes it a tougher environment than in previous years. Governments have been avoiding the "mega projects" for a few years, but some of the coming initiatives will create opportunities. Shared services initiatives, public/private partnerships and creative privatisation projects will come back to the fore and this will be an area of opportunity ... perhaps as early as 2013.
Canada, like the rest of the world, was expecting to be dealing with the effects of a retiring "boomer" population by now. The recession and the weakness in the stock markets put retirement plans on hold for many, so we have not yet seen a mass exodus from the workforce. These phenomena will happen and will be a factor in the job market in the coming months and years.
Canada's staffing industry is an excellent barometer of the health of our economy and the Canadian Staffing Index reflects the strength of our job sector. This index was trending up through the year and reached a record high in October (125), but slipped back to a still good reading of 118 in November. This index measures the hours worked by staffing industry workers each month.
The GTA (Greater Toronto Area) is the hottest job market in Canada. It is home to the highest number of head offices, it is Canada's major financial center and with a population of around 6 million it has the largest available workforce. If I was looking for work, this is the region I would be looking in and I would concentrate my attentions on the Financial, telecommunications, construction and service industries.
Despite the fact that Calgary's population is little more than 1 million, it is the second busiest market for jobs and the engine of Western Canada. The oil revenues spill into other cities, notably Regina but also Edmonton where provincial government benefits from the associated taxes. The West generically is a good place to be looking for work, particularly if you are willing to endure a little hardship in places like Fort McMurray.
Eagle's Eastern Canada region covers Ottawa, Montreal and "the Maritimes". There are definite signs that Ottawa is starting to pick up in demand after a long slow period that included downsizing, layoffs, spending freezes and general malaise in that Federal Government environment. Montreal continues to be busy and there are jobs to be had, again with particular emphasis on the financial sector, the telcos and the construction industry. There is also some demand in St John's, NFLD(population about 200,000), and in Halifax (approx. 400,000) but everything is relative and they are not big markets.
2012 was not a boom year for jobs in Canada, however from a numbers perspective finished well, with a four year low unemployment rate of 7.1%, and having added 312,000 jobs over the 12 months. Eagle saw a significant downturn in demand at the end of the year, but this seems to be picking up again mid-way through January.
The hot cities in Canada are Toronto (GTA) and Calgary, with Edmonton, Regina and Montreal good places to be looking for work too and while Ottawa has been slow, we are seeing hopeful signs there for 2013. The hot industries are banking, insurance, construction, telecommunications and the sectors that serve those industries. The sector that is not hiring at its normal pace would be government, but again that might be changing...
In the hotter markets we are seeing clear skills shortages and the "in demand" people are receiving multiple job offers, giving them the ability to "pick and choose". So ... IF you are looking for people and want to hire the best talent here are some things you should consider:
(a) Start the process early with a strong PLANNING phase;
(b) Develop very clean processes to find, screen, choose, hire and onboard these new resources (if you drag out the hiring process you WILL lose);
(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 quarterly look at the Canadian job market and some of its influences.
Kevin Dee is CEO of Eagle (a Professional Staffing Company)
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