Workers hold a level of bargaining power not seen in a generation as labour shortages are creating pressure on wages, working conditions, and benefits. Many employers and employees alike have not encountered a labour market shift like this. Employers will need to continue to be flexible in negotiations in order to fill vacancies.
For the last 40 odd years, employers held the market over employees as inflation rates soared during the 1970s and 1980s and industries found cheaper alternatives through offshoring, especially after China joined the World Trade Organization in 2001. Because of these shifts, workers struggled to find jobs and wages were suppressed as employers held most of the bargaining power. As a result, companies found it easier to hire and retain. That is not the case, however, in today’s working environment.
According to Statistics Canada’s December Labour Survey, more Canadians are working or actively seeking work. The rate of workers aged 15 or older has been rising year-over-year by about 3%, the unemployment rate dropping by 0.1% to 5%, and employment increasing by 0.5%. Regardless of these statistics, more than one third of Canadian employers are expected to face labour shortage issues in the next few months to years due largely to the rapidly aging working-age population.
As our aging workforce begins to retire, job vacancies in our country are at an all-time high. Despite the trends in our neighbouring country to the south, Canada’s workforce has not seen the same ‘Great Resignation’ trend. More than 1 in 5 workers in Canada are between 55-64 and from 2016 to 2021, the number of those 65 and older increased 18.3% to 7 million according to another Statistics Canada report. Our labour market shortage isn’t caused by the ‘Great Resignation,’ but rather by the ‘Great Retirement’.
Employers and industries that are struggling to fill vacancies will need to adapt their reopening and rehiring plan to offer more lucrative and competitive wages and benefits. The early pandemic shifted the mindset of workers as mass layoffs and hiring freezes caused many to reevaluate their work and worth. Now, according to this article from Ranstad, these are the top items employees are seeking in the post pandemic world:
Luckily for employers, there are still tons of options and assistance for hiring and training staff in our increasingly post-pandemic economy and employment agencies across Peterborough and the Kawarthas are eager to help fill voids.