PEI

'Try offering higher wages': Economist offers job vacancy solution

P.E.I. had one of the highest job vacancy rates in Canada in 2018, and a UPEI economist suggests the wages being offered may be part of the issue.

'We just don't pay people in the trades as much as they can make other places' 

People are aging out of the workforce and the economy is performing well, leaving many jobs vacant. (Dave Gilson/CBC)

P.E.I. had one of the highest job vacancy rates in Canada in 2018, and a UPEI economist suggests the wages being offered may be part of the issue.

A Statistics Canada report released Monday found 3.4 per cent of available jobs on the Island were vacant. Among the provinces only the rate in B.C. was higher: 4.6 per cent. The report also found the growth in the vacancy rate — 27 per cent — was second highest of the provinces, behind Quebec at 28 per cent.

UPEI economics Prof. Jim Sentance said P.E.I. wages, which are the lowest in Canada, are likely an issue.

"Every time there's a story about employers can't find workers … my economist friends on Twitter immediately slap their heads and say, 'Try offering higher wages,'" he said.

While the vacancy rate has climbed, wages being offered have scarcely moved, going from $15.25 in 2017 to $15.46 in 2018.

Labour market mismatch

The problem starts, Sentance said, with an aging population matched with a lot of jobs being created in the Island economy over the last few years.

'It doesn't make sense to stay here,' on P.E.I. if you can make more elsewhere as a tradesperson, says UPEI economist Jim Sentance. (CBC)

"We're getting to the point where people leaving the labour force as they retire are going to be leaving it in larger numbers than people coming into the labour force out of high school or university," he said.

That has been offset by immigration, but it's still not keeping up.

Outside of wages, there could be a mismatch with the skills people have and the skills needed for those jobs, or a mismatch of where the jobs are and where the people are.

Sentance said a lot of the vacant jobs are in the trades, transport and equipment operators sector, and pay being offered in that sector makes it difficult to attract workers or even retain the ones the Island has.

"We just don't pay people in the trades as much as they can make other places so it doesn't make sense to stay here, [and] certainly not to come here if you can get paid significantly more somewhere else," he said.

More P.E.I. news

About the Author

Kevin Yarr is the early morning web journalist at CBC P.E.I. You can reach him at kevin.yarr@cbc.ca.

Comments

To encourage thoughtful and respectful conversations, first and last names will appear with each submission to CBC/Radio-Canada's online communities (except in children and youth-oriented communities). Pseudonyms will no longer be permitted.

By submitting a comment, you accept that CBC has the right to reproduce and publish that comment in whole or in part, in any manner CBC chooses. Please note that CBC does not endorse the opinions expressed in comments. Comments on this story are moderated according to our Submission Guidelines. Comments are welcome while open. We reserve the right to close comments at any time.