CANADIAN JOB MARKET – Mini update Dec 2010/Jan 2011
In December Canada had a net gain of 22,000 jobs and the unemployment rate stayed at a pretty respectable (certainly for 2010) 7.6%. Concerns about inflation were allayed in November with the consumer price index rising just .1% for an annual rate of about 2%, considered very reasonable. The Canadian staffing index dropped to 83, which looks like a big drop however the index measure hours worked and December is a big vacation month and the seasonal expectation is for lower hours. The index was up 9 points from December 2009.
The Canadian dollar continues to be strong, remaining very close to parity with the US dollar with a value of greater than 99c. There continues to be concern in the markets, whether it be the economic state of Portugal or Ireland, the strength in the Chinese economy, the effects of Wikileaks or potential for strife around the World. The TSX has however continued to perform strongly, up another 100+ points from last month at 13,304 as opposed to 13,172 in November.
For Eagle, December represents one of the biggest “contract end” months of the year and is always greeted with some trepidation. For us December was a busier than normal month, with client demand remaining strong and a larger than normal number of contracts extended beyond the year end … another good sign that our clients are more optimistic and the Canadian economy is still doing well in its recovery!
The GTA (Greater Toronto Area) has been Eagle’s consistent engine of growth for 2010 and December was again a very busy month. If anything it is getting even busier, with consistent demand from the financial institutions as they invest in their systems. The Telcos are also very busy as they invest in their systems to remain competitive in an ever more competitive landscape. As expected the increased demand across large clients has meant that the system integrators also enjoying growth which means increased demand in the professional staffing world too, as they seek to augment their teams and access niche skills. Even the provincial market has been relatively busy of late! The GTA market generically has been busy in both of Eagle’s areas of focus technology resources and finance and accounting professionals. The need has been for both full time resources and contract/temporary resources … so Toronto is a good place to be looking for a job if you have skills in IT or accounting.
Demand across Western Canada continues to increase, yet clients are also very careful about how they spend, and so rates, to date, are being held down and the demand for full time staff is fairly high. Like the GTA this phenomenon is happening in demand for both IT resources and finance and accounting professionals. Calgary remains the hottest market with increased demand across multiple industries but driven by the oil and gas sector and its supplier base. The other Western markets continue to see increased activity too, just not at the Calgary/Toronto pace!
Eagle’s Eastern Canada region continues to heat up too, with Montreal particularly busy in demand for finance and accounting professionals as well as technology professionals. The Federal Government in Ottawa has been fairly busy in their need for contract resources of late. Technology employment in Ottawa is heavily dominated by the government too as the number of private sector jobs have dwindled over the last few years as the hi-tech sector has shrunk. There is an uptick in demand for full time employees too but the strong supply in the region means that Ottawa is still an employer’s market.
The following are some facts/indicators we are watching as of time of writing:
> The price of oil is steady at just over $88 a barrel, meaning oil companies in the West are investing in projects again.
> The TSX had another decent month currently sitting at 13,304, up more than 100 points from the last month reading of 13,172.
> The Canadian dollar continues to be strong and remains North of 99 cents US.
> Prime remains at 3% after three recent increases, and is not expected to rise again soon!
> Canada added 22,000 jobs and the unemployment rate stayed steady at 7.6%.
> December was a strong month for Eagle, following a bumper quarter.
> The Canadian Federal government market continues to generate demand, focused primarily on renewing their aging systems, and addressing the “boomer’ brain drain to retirement.
December is often a slow month due to less work days and the distraction of the holiday season. This year however we continued the job of recovering from the recession. Unemployment rates are respectable, certainly on the world stage, the Canadian dollar remains strong and inflation is not an immediate concern.
Across the country employers continued to demand resources to help them to be more competitive in this global economy, comply with changing regulatory requirements (IFRS) and differentiate from competition. We have seen steadily increasing demand in the larger markets for some time now and the pendulum is switching from an employer market to a candidate market. Clients want to bring on the very best employees and the top contractors whether in the technology space or the accounting world. More and more we are having to instruct our clients to be a little more flexible in their demands and the need for a speedy hiring process is paramount.
I said it last month and at the risk of being repetitive I will offer this advice to any companies considering hiring. (a) Start the process now; (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, so don’t procrastinate!
That is my monthly look at the job market across Canada and some of its influences.
Kevin Dee is CEO of Eagle (a Professional Staffing Company)