Good morning!
You’d be forgiven if the endless headlines about company layoffs are making you feel a little nervous about holding onto your job, but things might not be as dire as they may seem.
Canadian companies are still eager to hire, with more than half of them planning to boost headcount by adding permanent jobs in the first half of the year, according to the latest research from recruiter Robert Half Canada. That’s an increase from over six months ago, when 40 per cent of managers anticipated hiring. For those not adding jobs, 42 per cent are planning to hire to fill roles currently empty. Only six per cent say they’ll stop hiring completely, and just one per cent are planning to cut jobs.
Those numbers match the Bank of Canada’s latest Business Outlook survey, which showed that almost half of employers are still planning to hire during the first few months of the year. That said, companies are also being cautious, and don’t plan to hire as robustly as in previous quarters.
Still, a tight labour market is complicating hiring plans. Job vacancies remain high, though down from historic highs, and employers continue to say they’re having trouble filling them. Skilled labour shortages remain the top issue holding back the growth of small businesses, according to the latest Business Barometer reading from the Canadian Federation of Independent Business.
Things south of the border are also not as grim as layoff headlines would lead you to believe. The latest United States Bureau of Labor Statistics report released on Feb. 3 blew expectations out of the water. The U.S. added 517,000 jobs in January, pushing the unemployment rate down to 3.4 per cent, the lowest since May 1969. Bloomberg economists had expected a mere 188,000 new jobs, and for the unemployment rate to rise to 3.6 per cent. More companies in the U.S. may have cut jobs in January than in the past two years, but layoffs are at historic lows, not highs, Bloomberg noted.
The data hardly paints a picture of a labour market in collapse, but no one’s quite sure where the market will go from here. “One of the wild cards for the economic forecast in 2023 is what will happen to labour markets,” says Trevin Stratton, national leader and partner, Economic Advisory, at Deloitte Canada, in an interview with the Financial Post’s Larysa Harapyn.
Stratton points out that though recessions are traditionally associated with job losses, the situation is different this time. Businesses are being forced to balance expected softening consumer demand with labour shortages. “Employers are somewhat reluctant to let go of their workers right now just for fear of not being able to fill those vacant positions once the economy begins to recover,” he says.
We’ll get an updated picture of what’s going on with the labour market on Feb. 10 when Statistics Canada releases its labour force survey for January. In the meantime, if you are feeling anxious about job security, maybe give yourself a break and let those fears go. If you do find yourself holding a pink slip, know that there’s always another job around the corner, especially in this tight labour market.
