Ted Mallett, Vice President & Chief Economist
Canada's private sector job vacancy rate saw a steep drop in Q2 2020. The average rate fell to 2.5 per cent from the 3.3 per cent rates that had been steady through most of 2019 and into the early part of this year. COVID-19 and the economic shutdown caused a sharp 14 per cent drop in private sector jobs in the latest quarter and an even greater 39 per cent drop in vacancies as businesses struggled to rebalance their operations. Estimated vacancies totaled 270,100 in Q2, down from 439,500 in the previous quarter.
Results were similar within all provinces and industry groupings, with those with the highest vacancy rates in the past generally seeing the biggest declines. Vacancy rates in Quebec, Ontario and Nova Scotia recorded rate reductions of close to 1 per cent. Reductions were less in the Prairie Provinces, where labour markets were already in a weaker state. Rates remained highest in Quebec (3.3 per cent), British Columbia (2.8 per cent) and New Brunswick (2.7 per cent).
The largest declines by industry included transportation, personal services and wholesale trade. Sectors, though with larger shares of very small enterprises still tend to display higher vacancy rates than average.
It should be noted that these data aim to reflect long-term job vacancies that have persisted for at least four months with each workplace. They would not, therefore, directly address questions over short-term work-disincentive effects of the Canada Emergency Response Benefit (CERB).
The drivers of longer term vacancies are more significantly determined by future outlooks, growth intentions, business size and firm-specific job characteristics. Vacancies also continue to be a strong influence on wages. Employers with at least one vacancy expect to push average organization-wide wage levels up by 1.0 per cent in Q2—versus a 0.3 per cent gain planned by businesses without any job openings.