Labour Statistics at a Glance
Recent trends in Canada’s labour market: A rising tide or a passing wave?

by Vincent Hardy, Marton Lovei and Martha Patterson

Release date: August 31, 2018

Several indicators pointed to positive trends in the Canadian labour market in 2017. As noted in the Annual Review of the Labour Market, employment grew at its fastest pace in a decade, and the unemployment rate matched a record low of 5.8% in December 2017.

How has the labour market fared over the first six months of 2018? Based on the latest available data from the Labour Force Survey (LFS), the Survey of Employment, Payrolls and Hours (SEPH), and the Job Vacancy and Wage Survey (JVWS) up to June 2018, this analysis takes stock of recent trends and noteworthy topics in relation to the labour market.

Overall, the number of people in employment increased by 214,900 or 1.2% from June 2017 to June 2018, while job vacancies were up 19.0% from the first quarter of 2017 to the first quarter of 2018.

However, signs of moderation are beginning to emerge. Year‑over‑year employment growth was slower in the first half of 2018 compared with the second half of 2017, and the number of people working was little changed between December 2017 and June 2018 (Chart 1).

Monthly employment level and year-over-year growth rate, June 2016 to June 2018

Data table for Chart 1
Data table for Chart 1
Table summary
This table displays the results of Data table for Chart 1 Employment (left axis) and Year-over-year growth rate (right axis), calculated using thousands and percent units of measure (appearing as column headers).
Employment (left axis) Year-over-year growth rate (right axis)
thousands percent
2016 June 18,054.3 0.6
July 18,044.2 0.4
August 18,081.1 0.5
September 18,147.7 0.9
October 18,183.5 1.0
November 18,185.5 1.1
December 18,217.8 1.2
2017 January 18,268.4 1.5
February 18,290.0 1.6
March 18,308.6 1.5
April 18,325.4 1.6
May 18,358.0 1.8
June 18,413.1 2.0
July 18,436.2 2.2
August 18,458.8 2.1
September 18,471.4 1.8
October 18,499.1 1.7
November 18,580.3 2.2
December 18,645.1 2.3
2018 January 18,557.1 1.6
February 18,572.5 1.5
March 18,604.8 1.6
April 18,603.7 1.5
May 18,596.2 1.3
June 18,628.0 1.2

A recovery in wage growth?

Following two years of little to no growth, average weekly earnings have increased at a relatively fast pace since the fall of 2017. According to data from SEPH, from September 2017 to May 2018, the earnings of non‑farm payroll employees increased by 2.4% or higher on a year‑over‑year basis (Chart 2).

Year-over-year change in the average weekly earnings of payroll employees, Canada, May 2015 to May 2018

Data table for Chart 2
Data table for Chart 2
Table summary
This table displays the results of Data table for Chart 2 Year-over-year change, calculated using percent units of measure (appearing as column headers).
Year-over-year change
percent
2015 May 1.3
June 1.8
July 1.5
August 0.6
September 1.5
October 1.4
November 1.4
December 1.6
2016 January 0.1
February 0.5
March 0.5
April -0.2
May 0.7
June 0.4
July -0.1
August 1.5
September 0.1
October -0.1
November 0.9
December 1.4
2017 January 1.8
February 1.0
March 1.1
April 1.9
May 1.7
June 1.6
July 1.3
August 1.9
September 3.2
October 3.0
November 3.2
December 2.5
2018 January 2.8
February 3.4
March 3.1
April 2.4
May 2.9

Mostly as a result of the oil price shock that began in the fall of 2014, average weekly earnings in Alberta trended down from the winter of 2015 to the spring of 2016. Although earnings in Alberta have not yet returned to their former level, the earnings growth rate in the province has followed a trend similar to that of the rate observed in Ontario since June 2017 (Chart 3).

Year-over-year change in the average weekly earnings of payroll employees, Ontario and Alberta, May 2014 to May 2018

Data table for Chart 3
Data table for Chart 3
Table summary
This table displays the results of Data table for Chart 3 Ontario and Alberta, calculated using percent units of measure (appearing as column headers).
Ontario Alberta
percent
2014 May 1.8 3.2
June 2.1 4.6
July 3.1 4.8
August 2.0 4.8
September 2.6 3.5
October 1.9 4.1
November 1.0 2.5
December 1.6 1.1
2015 January 2.0 3.7
February 2.6 2.4
March 3.7 1.1
April 3.3 0.9
May 1.9 0.2
June 2.4 -0.5
July 2.7 -1.7
August 1.7 -2.6
September 2.4 -1.5
October 2.8 -2.6
November 3.0 -2.1
December 3.2 -0.7
2016 January 1.3 -4.8
February 0.9 -3.1
March 0.8 -2.3
April 0.5 -3.1
May 1.9 -4.3
June 1.9 -2.6
July 0.2 -1.0
August 2.1 -0.5
September 0.4 -1.9
October 0.6 -2.6
November 1.1 -1.4
December 1.9 -0.8
2017 January 2.3 -0.4
February 1.9 -1.3
March 1.3 -0.7
April 1.8 0.6
May 1.3 0.9
June 0.8 1.7
July 0.7 0.2
August 1.4 0.9
September 3.4 2.7
October 2.7 3.3
November 3.2 2.9
December 2.3 1.5
2018 January 2.7 2.9
February 3.3 4.0
March 3.2 3.2
April 2.6 2.4
May 3.1 3.4

Uneven regional employment growth

National trends in employment mask differences across the provinces. From June 2017 to June 2018, employment increased in Ontario, Alberta, Manitoba, and Prince Edward Island. After driving employment growth at the national level from June 2016 to June 2017, British Columbia and Quebec recorded little change from June 2017 to June 2018. The number of people working in Nova Scotia, New Brunswick, Saskatchewan, and Newfoundland and Labrador was also little changed over the later period (Chart 4).

Year-over-year change in employment by province

Data table for Chart 4
Data table for Chart 4
Table summary
This table displays the results of Data table for Chart 4 June 2017 to June 2018 and June 2016 to June 2017, calculated using percent units of measure (appearing as column headers).
June 2017 to June 2018 June 2016 to June 2017
percent
Prince Edward Island 2.4 4.6
Ontario 2.2 1.1
Alberta 1.5 2.1
Nova Scotia 1.0 0.2
New Brunswick 0.9 0.4
Manitoba 0.9 1.4
Saskatchewan 0.8 -0.4
Quebec 0.6 3.0
Newfoundland and Labrador -0.3 -5.3
British Columbia -0.8 4.6

Employment trends diverged between population centres and rural regions.Note 1 Comparing the average of the twelve months ending in June 2018 with the same period the previous year, nearly all (98%) of employment growth at the national‑level was in population centres.

Since the recession,Note 2 rural employment has edged down, while the number of employed people was up 12.6% in population centres. In Nova Scotia and New Brunswick in particular, the growth in population centres was strongly offset by declines in rural areas (Chart 5).

Employment change in rural areas and population centres, New Brunswick and Nova Scotia, June 2009 to June 2018

Data table for Chart 5
Data table for Chart 5
Table summary
This table displays the results of Data table for Chart 5 Rural areas and Population centres, calculated using thousands units of measure (appearing as column headers).
Rural areas Population centres
thousands
New Brunswick -17,600 10,800
Nova Scotia -14,500 15,200

Matching the unemployed and job vacancies

Although the unemployment rate fell to a record low of 5.8% in December 2017, and increased only slightly to 6.0% in June, some unemployed individuals may have had difficulty finding a job that matched their skill level.

The unemployment‑to‑job vacancies ratio provides an indication of how well the attributes of the unemployed match the characteristics sought by employers.

Taking the average of the last three quarters of 2017 and the first quarter of 2018,Note 3 there were 4.7 unemployed people with a bachelor’s degree or higher for every vacancy that sought this level of education.Note 4 In comparison, there were 1.6 unemployed people with a high school diploma or lower for each vacancy looking for a candidate with no specified level of education or with a high school diploma (Chart 6).

In other words, unemployed individuals with a bachelor’s degree or higher may have found it more difficult to find work if they looked for a job that matched their skill level.

Unemployment-to-job vacancies ratio by education level, Canada, March 2018

Data table for Chart 6
Data table for Chart 6
Table summary
This table displays the results of Data table for Chart 6 Unemployment-to-job vacancies ratio (appearing as column headers).
Unemployment-to-job vacancies ratio
High school or less 1.6
University certificate or diploma below bachelor's level 4.1
Bachelor's degree, or university certificate or diploma above bachelor's degree 4.7

Based on the average of the four quarters ending in March, Newfoundland and Labrador was the only province where the number of unemployed for every job vacancy increased between 2016/2017 and 2017/2018 (Chart 7).

Unemployment-to-job vacancies ratio by province

Data table for Chart 7
Data table for Chart 7
Table summary
This table displays the results of Data table for Chart 7 March 2018 and March 2017, calculated using percent units of measure (appearing as column headers).
March 2018 March 2017
unemployment-to-job vacancies ratio
Newfoundland and Labrador 10.8 9.9
Prince Edward Island 4.7 6.2
Nova Scotia 4.0 4.5
New Brunswick 3.9 5.4
Saskatchewan 3.6 4.2
Alberta 3.5 4.7
Quebec 2.9 4.5
Manitoba 2.6 3.6
Ontario 2.3 2.8
British Columbia 1.4 2.0

At the economic region (ER) level (excluding the territories), the unemployment‑to‑job vacancies ratio was highest in South–Coast Burin Peninsula and Notre Dame–Central Bonavista Bay, Newfoundland and Labrador; and lowest in Lower Mainland–Southwest, British Columbia. Lower Mainland–Southwest also had the second‑largest job vacancy rateNote 5 among all ERs, while South–Coast Burin Peninsula and Notre Dame–Central Bonavista Bay had the second‑smallest job vacancy rate and the highest unemployment rate.

Flexibility and labour market integration

People unemployed for a year or more, and individuals potentially looking for permanent employment also faced obstacles.

In the 12 months ending in June 2018, an average of 126,500 individuals were unemployed despite having searched for work for a year or more. The overall unemployment rate fully recovered from the 2008/2009 recession in 2017/2018, but the long‑term unemployment rateNote 6 remained above pre‑recession levels (Chart 8).

Long-term unemployment rate, June 2007 to June 2018

Data table for Chart 8
Data table for Chart 8
Table summary
This table displays the results of Data table for Chart 8 Long-term unemployment rate, calculated using percent units of measure (appearing as column headers).
Long-term unemployment rate
percent
2007 June 0.5
2008 June 0.4
2009 June 0.5
2010 June 0.8
2011 June 1.0
2012 June 0.9
2013 June 0.9
2014 June 0.9
2015 June 0.8
2016 June 0.7
2017 June 0.8
2018 June 0.6

Temporary employment accounted for nearly 20% of employment gains from 2016/2017 to 2017/2018. This includes seasonal, term or contract, casual, and other forms of non‑permanent employment. Growth in temporary work has outpaced permanent employment since 1998/1999 (Chart 9). The share of people employed on a temporary basis rose from 12.0% to 13.6% over this period.

Index of the number of employees with a permanent or temporary job, Canada, June 1998 to June 2018

Data table for Chart 9
Data table for Chart 9
Table summary
This table displays the results of Data table for Chart 9 Permanent employees and Temporary employees, calculated using june 1998 = 100 units of measure (appearing as column headers).
Permanent employees Temporary employees
june 1998 = 100
1998 June 100.00 100.00
1999 June 102.05 105.25
2000 June 105.43 109.17
2001 June 107.59 121.06
2002 June 109.65 121.85
2003 June 112.96 124.46
2004 June 115.06 124.29
2005 June 115.85 131.45
2006 June 117.35 134.88
2007 June 120.06 137.12
2008 June 123.28 133.16
2009 June 122.65 130.00
2010 June 120.70 137.88
2011 June 122.92 145.54
2012 June 124.43 149.65
2013 June 126.58 150.04
2014 June 128.23 148.98
2015 June 128.94 151.43
2016 June 130.04 150.97
2017 June 131.69 155.61
2018 June 133.57 159.03

Compared with ERs with the lowest unemployment rates, ERs with the highest unemployment rates tended to have a larger proportion of individuals employed on a temporary basis (Chart 10). All five high‑unemployment ERs were in Atlantic Canada and had among the highest shares of employees who were seasonal workers.

Unemployment rate and share of temporary employment by economic region, June 2018

Data table for Chart 10
Data table for Chart 10
Table summary
This table displays the results of Data table for Chart 10 Unemployment rate and Size = Share of temporary employment in the economic region, calculated using percent units of measure (appearing as column headers).
Unemployment rate Share of temporary employment
percent
South Coast–Burin Peninsula and Notre Dame–Central Bonavista Bay, Newfoundland and Labrador 20.1 28.1
West Coast–Northern Peninsula–Labrador, Newfoundland and Labrador 15.9 23.8
Cape Breton, Nova Scotia 14.2 23.1
Campbellton–Miramichi, New Brunswick 12.2 25.3
Gaspésie–Îles-de-la-Madeleine, Quebec 12.1 25.8
Swift Current–Moose Jaw, Saskatchewan 4.1 10.2
Capitale-Nationale, Quebec 4.1 14.5
Stratford–Bruce Peninsula, Ontario 4.0 9.5
South Central and North Central, Manitoba 3.5 12.5
Chaudière-Appalaches, Quebec 2.9 12.8

The changing face of labour supply

Key structural differences in the age composition and immigrant status of provincial and regional populations remained.

In the 12 months ending in June 2018, 2.4% of the working age population in Newfoundland and Labrador were landed immigrants on average, compared with 31.5% in Ontario (Chart 11).

Proportion of landed immigrants aged 15 to 64, June 2018

Data table for Chart 11
Data table for Chart 11
Table summary
This table displays the results of Data table for Chart 11 Proportion, calculated using percent units of measure (appearing as column headers).
Proportion
percent
Ontario 31.5
British Columbia 29.2
Alberta 23.1
Manitoba 21.7
Quebec 16.6
Saskatchewan 14.0
Prince Edward Island 7.6
New Brunswick 6.4
Nova Scotia 5.1
Newfoundland and Labrador 2.4

With the aging of the baby‑boom cohort, the share of the Canadian population who are aged 55 and older has been growing. Based on the 12‑month average ending in June 2018, 45.5% of those aged 55 and older were between the ages of 55 and 64. Over the same period, 62.6% of 55‑ to 64‑year‑olds were employed. Employment for this group increased by 3.4% from 2016/2017 to 2017/2018, outpacing its population growth rate (2.0%).

The extent to which 55‑ to 64‑year‑olds participated in the labour market varied considerably on a regional basis. At the ER level, there was a negative relationship between the share of 55‑ to 64‑year‑olds in the population and their participation rate. In other words, this group tended to be less active in the labour market in areas where they represented a larger proportion of the population (Chart 12).

Participation rate of 55- to 64-year-olds and their share of the population by economic region, June 2018

Data table for Chart 12
Data table for Chart 12
Table summary
This table displays the results of Data table for Chart 12 Participation rate and Share of the population, calculated using percent units of measure (appearing as column headers).
Share of the population Participation rate
percent
Avalon Peninsula, Newfoundland and Labrador 16.9 56.5
West Coast–Northern Peninsula–Labrador, Newfoundland and Labrador 20.8 62.5
South Coast–Burin Peninsula and Notre Dame–Central Bonavista Bay, Newfoundland and Labrador 20.6 56.0
Prince Edward Island 17.9 69.7
Cape Breton, Nova Scotia 21.9 58.0
North Shore, Nova Scotia 20.7 60.3
Annapolis Valley, Nova Scotia 17.8 61.7
Southern, Nova Scotia 19.8 59.0
Halifax, Nova Scotia 16.7 64.4
Campbellton–Miramichi, New Brunswick 21.5 58.9
Moncton–Richibucto, New Brunswick 17.9 67.3
Saint John–St. Stephen, New Brunswick 17.6 58.3
Fredericton–Oromocto, New Brunswick 17.6 64.2
Edmundston–Woodstock, New Brunswick 21.0 62.1
Gaspésie–Îles-de-la-Madeleine, Quebec 22.5 57.3
Bas-Saint-Laurent, Quebec 20.0 56.0
Capitale-Nationale, Quebec 17.5 63.7
Chaudière-Appalaches, Quebec 19.5 63.4
Estrie, Quebec 19.8 63.3
Centre-du-Québec, Quebec 18.2 59.1
Montérégie, Quebec 17.4 68.2
Montréal, Quebec 14.8 67.6
Laval, Quebec 15.6 71.7
Lanaudière, Quebec 18.4 62.4
Laurentides, Quebec 18.2 63.9
Outaouais, Quebec 18.7 58.6
Abitibi-Témiscamingue, Quebec 19.4 60.4
Mauricie, Quebec 20.0 54.4
Saguenay–Lac-Saint-Jean, Quebec 19.0 57.6
Côte-Nord and Nord-du-Québec, Quebec 20.5 55.6
Ottawa, Ontario 18.1 61.3
Kingston–Pembroke, Ontario 18.2 60.6
Muskoka–Kawarthas, Ontario 21.6 61.0
Toronto, Ontario 15.1 70.5
Kitchener–Waterloo–Barrie, Ontario 15.1 72.8
Hamilton–Niagara Peninsula, Ontario 17.3 64.2
London, Ontario 17.2 62.2
Windsor–Sarnia, Ontario 17.9 57.0
Stratford–Bruce Peninsula, Ontario 18.5 68.2
Northeast, Ontario 19.2 55.2
Northwest, Ontario 18.5 58.9
Southeast, Manitoba 16.5 67.0
Southwest, Manitoba 14.5 71.6
South Central and North Central, Manitoba 17.0 64.3
Winnipeg, Manitoba 15.1 66.9
Interlake, Manitoba 21.3 66.6
Parklands and North, Manitoba 17.5 69.7
Regina–Moose Mountain, Saskatchewan 15.4 69.7
Swift Current–Moose Jaw, Saskatchewan 20.6 71.2
Saskatoon–Biggar, Saskatchewan 15.5 70.4
Yorkton–Melville, Saskatchewan 18.2 71.5
Prince Albert and Northern, Saskatchewan 17.2 69.2
Lethbridge–Medicine Hat, Alberta 15.9 67.2
Camrose–Drumheller, Alberta 16.4 72.3
Calgary, Alberta 15.4 73.2
Red Deer, Alberta 18.1 74.3
Edmonton, Alberta 14.4 70.4
Banff–Jasper–Rocky Mountain House and Athabasca–Grande Prairie–Peace River, Alberta 16.8 75.9
Wood Buffalo–Cold Lake, Alberta 14.3 75.2
Vancouver Island and Coast, British Columbia 18.9 64.0
Lower Mainland–Southwest, British Columbia 15.8 67.8
Thompson–Okanagan, British Columbia 17.3 65.2
Kootenay, British Columbia 19.0 64.3
Cariboo, British Columbia 17.9 66.4
North Coast and Nechako, British Columbia 20.8 62.3
Northeast, British Columbia 16.1 76.0

In Gaspésie–Îles‑de‑la‑Madeleine, Québec, the ER with the highest proportion of 55‑ to 64‑year‑olds, the participation rate for the group was 57.3%. In contrast, the participation rate of 55‑ to 64‑year‑olds was 75.2% in Wood Buffalo–Cold Lake, the ER where their share of the population was smallest.

Conclusion

The analysis presented in this short article used recent Statistics Canada data to evaluate how the labour market fared over the first six months of 2018.

The second half of 2017 was the six‑month period with the largest employment gains since 2010. Furthermore, in September 2017, year‑over‑over growth in average weekly earnings exceeded 2.0% for the first time since 2015.

Although earnings continued to grow steadily in the first half of 2018, employment was little changed overall and some regions and groups had less favourable labour market outcomes than others. There is evidence to suggest the ratio of unemployment‑to‑job vacancies was greater at higher levels of education. In addition, the distribution of employment gains, the proportion of workers employed on a permanent basis, and the demographics of the working‑age population continued to vary across the country.

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