Just a few years ago, Canada was scrambling to fill a record volume of vacant jobs. Now it’s struggling to cope with the volume of excess workers. Statistics Canada (Stat Can) data shows companies added more workers to their payrolls in January. However, job vacancies fell to the lowest level since 2017, making it the worst job market in over 7 years.
Canadian Companies Added More Employees To Payrolls
First, let’s start with the good news—Canadian payrolls added more employees. Payroll employees saw seasonally adjusted monthly growth of 0.1% (+23.5k jobs), reaching 17.3 million people in January. This represents a 0.9% (+152.2k) increase compared to last year. Any growth is good news here, but less than a point isn’t enough to handle the population growth, even if we were at pre-2020 volumes.
Canadian Workers Have Seen Job Vacancies Plunge 20% Lower
Those with a job are going to want to hang on tight because there are fewer companies hiring. Seasonally adjusted monthly vacancies fell 2.5% (-13.5k jobs) to just 526.2k vacancies in January. This represents a massive 20.6% (-136.7k) drop from last year, leading to one of the worst rates in a very long time.
Canadian Job Vacancy Rate Hits The Lowest Level In Over 7 Years
The Canadian seasonally adjusted job vacancy rate.
Source: Statistics Canada.
The job vacancy rate, the share of jobs advertised as a share of total workers, plunged to a multi-year low. The seasonally adjusted rate was just 2.9% in January, down 0.1 points. This represents a 0.8-point drop from last year, meaning less than one job is available for every two unemployed workers. It works out to the lowest rate since October 2017, more than 7 years ago.
Those who think this issue only impacts the unemployed are very much mistaken. When Canada’s economy was booming just a few years ago, there was said to be an excess of jobs and not enough workers. That swings the benefit towards workers, helping to boost wages and provide upward opportunities. However, now the exact opposite is happening—the pendulum is swinging back towards employers. As a result, workers can generally expect longer job hunts, more competition, and fewer pressures driving wage growth.
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