What's behind the labour shortages?

Store owner turning open sign broad through the door glass and ready to service.
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Analysts attribute the U.S. worker shortages to virus fears, childcare demands and generous unemployment benefits. The same forces are at work in Canada, too.

“We do predict that many employers will struggle to get their teams back together because, for many, the workers have basically been able to be off for months on end and some workers may understandably be a bit hesitant to return to the workplace,” Dan Kelly, head of the Canadian Federation of Independent Business, recently told the Financial Post.

The number of jobs in Canada fell by about 68,000 in May, according to Statistics Canada, primarily in part-time work, due in part to restrictions from the now-waning third wave of the virus. The unemployment rate was flat at 8.2%.

Shortages among U.S. employers aren't letting up. Finding qualified employees has been the biggest challenge for small business owners — and it’s hampering economic growth, Bill Dunkelberg, chief economist for the National Federation of Independent Business, said last month.

A record 48% of owners surveyed by the small business association reported job openings they could not fill in May.

"The labor shortage is holding back growth for small businesses across the country,” Dunkelberg says in a report. “If small business owners could hire more workers to take care of customers, sales would be higher and getting closer to pre-COVID levels."

How Canada can learn from America’s labour woes

Typical american now hiring sign in black letters over the white background with local small business building
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In the U.S., demand came back so quickly that it became difficult for businesses to staff up as furloughed employees didn’t want to return to work.

Plus, employers didn’t have the human resource staff to bring on new talent quickly, according to ZipRecruiter, an online job board that uses AI technology to connect people to jobs. Businesses were also surprised to the extent that their employees wanted to continue working remotely.

“Thinking through these issues early and developing clear policies and practices now can help businesses gain a competitive advantage and reduce friction,” Pollak says.

Canadian employers should be prepared to re-staff their offices, shops and restaurants in order to meet demand — before a widespread shortage takes hold.

One advantage to Canadian employers is the country's more welcoming immigration system.

What businesses can do if they can’t find workers

Fake Classified Ad, newspaper, business concept.
Feng Yu / Shutterstock

If employers are struggling to fill positions, ZipRecruiter recommends the following steps.

  • Be clear. Include in job listings that you are actively hiring during the pandemic and have an urgent need for candidates.

  • Be flexible. If working remotely is an option, make it clear to the candidate.

  • Offer more money. Consider raising pay or providing one-time hiring bonuses. Secure perks for employees, like gym discounts or pet insurance policies.

  • Confront COVID. Many candidates are still worried about contracting the coronavirus. Implement best practices around COVID mitigation and communicate them clearly.

  • Compensate with stock. Take a cue from the rise in popularity of affordable and user-friendly mobile investing apps. Consider offering stock options or make them more widely available.

Advice for the job seeker

female employment concept
bernatets photo / Shutterstock

If you've been out of work during the pandemic and aren't sure where to start your job search, there are steps you can take to ease the transition.

If you're looking for a flexible gig, try an online service that specializes in remote, part-time, freelance and other less structured job postings.

If freelancing is your thing, consider signing up with a platform that allows you to offer your services to those with needs that match your skills.

And while you're searching for a job, take an online course taught by an industry expert to develop new skills that will make yourself more marketable to the most in-demand businesses.

And for the more creative types, check out an online community that offers classes on such topics as design, illustration and photography or video.

About the Author

Nancy Sarnoff

Nancy Sarnoff

Senior Reporter/Editor

Nancy Sarnoff is a senior reporter and editor at MoneyWise. Previously, she covered commercial and residential real estate for the Houston Chronicle where she also hosted Looped In, a podcast about the region’s growth, development and economy. Her work has been recognized by the National Association of Real Estate Editors and the Society of American Business Editors and Writers.

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