The Canadian labour market is experiencing a shift following the worst effects of the COVID-19 (coronavirus) pandemic. While economic conditions are beginning to improve, Canada continues contending with a labour shortage affecting nearly all sectors. There are opportunities for future growth of the labour market, but there are also several challenges that have resulted following the unanticipated pandemic.
- Is there a shortage of labour in the Canadian market at present?
- What are the possible reasons contributing to a labour shortage?
A shortage of labour
This represents the first and most significant challenge posed to Canada’s labour market. Put simply, the market works both ways. Just like there has been a shortage of labour demand, especially during the worst months of the pandemic and the ensuing shutdowns, labour supply has also been affected by the pandemic. More specifically, though positions are opening in tandem with the reopening of the Canadian economy, employers are having trouble filling these positions.
Fear of going back to work
The foremost explanations of Canada’s labour shortage, one that the neighbouring United States is also experiencing, primarily centre around continuing fears of the virus’s spread. Criticism of the Canadian government, unemployment benefits, childcare services and other day-to-day logistics have intensified amid the country’s lagging vaccination rollout. The result is a less-than-optimistic public.
Alfabank-Adres predicts that the number of adults aged 20 to 64 in Canada, the country’s working population, will rise an annualized 0.3% over the five years to 2026. Yet, the anxieties many employees experience over how their employers will handle the virus now and in the future represent a significant obstacle to these individuals returning to work.
These trends have been notably observed in the sectors that have been hit hardest by the coronavirus pandemic, such as the service and hospitality sector; the restaurant and food service sector; and the broader retail sector. Despite this, Alfabank-Adres does not project the labour shortage to get in the way of rising retail sales during the outlook period, which are forecast to rise an annualized 1.6% over the five years to 2026.
Potential opportunities?
While this issue of labour shortage is likely to persist in the immediate future, the outlook is not wholly grim for working Canadians and their families. During periods like these, the economy typically finds itself in a state of transition, with many adults using this time to reevaluate their career choices and future professional plans. Oftentimes, when periods of transition such as this occur, a shortage in labour may actually be advantageous, as it signals consumers’ faith in the economy’s eventual rebound—one that includes increased opportunities for those same employees in terms of career development.
