N.L. job vacancy rate symbolic of lagging economy, says analyst
StatsCan report shows nearly 5,000 vacancies, but labour market economist says number is deceiving
A new report from Statistics Canada shows there were nearly 5,000 job vacancies in Newfoundland and Labrador at the end of June, but don't think it's an indicator of a booming economy.
A closer look at the data exposes some troubling trends for the province, says labour market economist Brendan Bernard of the online job site Indeed Canada.
"That number isn't particularly high," Bernard told CBC News.
But it raises the question: how can a province with the highest unemployment rate in Canada — 13.1 per cent in August, according to Statistics Canada — have thousands of unfilled jobs?
Seasonal, temporary jobs dominate
For one thing, nearly half of the vacancies were seasonal, temporary positions, in generally low-paying sectors such as accommodations, food service and retail sectors, "and might not be the job that every job seeker is hoping for," said Bernard.
The Canadian benchmark for seasonal, temporary jobs is roughly 25 per cent of the vacancy rate, Bernard explained.
"This proves again that the Newfoundland and Labrador economy is largely seasonal," he added.
The numbers are contained in the latest job vacancy and wage survey by Statistics Canada.
The report revealed the number of job vacancies in Canada had grown to more than 581,000 by the end of the second quarter of 2019, which is a 6.4 per cent increase over the same period in 2018.
The overall vacancy rate climbed slightly to 3.5 per cent, which is the highest rate since comparable data became available in 2015.
A high vacancy rate is generally an indicator of a healthy economy because it suggests that companies are hiring, and new businesses are being established.
It means the appetite for hiring isn't too significant. And when they are looking to hire workers, it isn't as challenging as it might otherwise be.- Brendan Bernard
The pace of growth in the Canadian vacancy rate has slowed, but "overall it still suggests that employers are looking to hire a lot more than they used to in previous years," said Bernard.
In Newfoundland and Labrador, meanwhile, there were 4,950 vacancies, an increase of 500 over a year ago, and a vacancy rate of 2.5 per cent.
But in a labour force with more than 193,000 employees, the vacancy rate is "fairly low by Canada-wide standards."
"I think it means the appetite for hiring isn't too significant," Bernard said. "And when they are looking to hire workers, it isn't as challenging as it might otherwise be."
Over the last four quarters, the province's average vacancy rate is the lowest in the country.
"In general the struggles that we see in the Newfoundland [and Labrador] labour market coming from the unemployment rate data is also showing up in the job vacancy data," he said.
But an 11 per cent growth in the job vacancy numbers on a year-over-year basis, and a two-point drop in the unemployment rate (14.4 to 12.4 per cent) from May 2018 to May 2019, are positive indicators, said Martha Patterson, a senior analyst with Statistics Canada's centre for labour market information.
Health-care job vacancies
One sector where the vacancy rate is closer to the national average is in health care, Bernard said.
There's also a healthy number of vacancies in a category called professional and technical services, with well-paying jobs in areas such as high-tech, engineering, science, law and advertising.
But Bernard said there are fewer jobs in transportation and warehousing, which is in stark contrast to the Canadian average, and symbolic of a "pretty weak" Newfoundland and Labrador economy.
"It's kind of a symptom of the general economic struggles going on [in the province]," he said.