Reduced hours in shops, endless waits at restaurants, residential renovations postponed indefinitely, service disruptions in hospitals… the effects of labor scarcity are very real. What is happening in the job market? Where have the workers gone? Are these shortages temporary? These questions are on everyone’s lips and, unfortunately, the answers are not so simple, let alone the solutions to be favored.
The demographic transition
The main cause of the current labor shortage has long been known. It is a fact, a very predictable reality that has a name: the accelerated aging of the Quebec population.
Concretely, this means that for several years now, the number of people leaving the labor market to retire has exceeded the number of young people entering it.
Currently, for every 100 people aged 55 to 64, there are only 83 people aged 20 to 29. While there were nearly eight potential workers per person aged 65 and over in 1971, there will be only two in 2031.
By that date, the pool of potential workers, those aged 20 to 64, will be nearly 100,000 fewer.
The aging of the population had started to be felt long before the pandemic, its impact having first translated into a fall in unemployment and a rise in the employment rate, it has now become the main brake on economic growth. and the sustainability of essential services.
PHOTO MARTIN CHAMBERLAND, PRESS ARCHIVES
The demand for labor is strong in catering
A vigorous recovery
Although the COVID-19 crisis caused the economy to contract sharply, the recovery has been extremely vigorous. Thus, the strength and speed of the recovery, together with pressing staffing needs in health care, have created strong upward pressure on the demand for labor. The explosion of job vacancies since 2019, mainly in healthcare and construction, but also in professional services, food services and accommodation, retail trade and manufacturing is testament to the magnitude of current needs.
The intensity of the demand for workers will depend in large part on the strength of future economic growth, but the demand for health services will undoubtedly continue.
Closing borders in 2020
Other reasons related to the pandemic explain the current shortages, mainly the restrictions imposed at the borders as of March 2020. The external migratory balance (interprovincial and international) fell radically from 93,474 in 2019 to 14,037 in 2020, a decrease nearly 80,000 foreign workers and students with the opportunity to participate in the labor market. This is mainly due to the collapse in the balance of non-permanent residents (international students and temporary workers), but also to delays in processing permanent resident files. These results, which break with the upward trend of previous years, could partly explain why the job market tightened so quickly in 2020.
The relaxation of health restrictions and a rapid catch-up in the processing of applications for permanent residence could allow a certain regularization of the situation. But we’ll have to see if that’s enough.
PHOTO BERNARD BRAULT, PRESS ARCHIVES
Recruitment by Publisac in times of pandemic
Priorities that have changed?
On the workers’ side, the vast majority of the pandemic unemployed have returned to the labor market. As proof, the unemployment rate is falling steadily and the activity rate has returned to its pre-pandemic level.
However, there are still nearly 60,000 more unemployed than before the pandemic. Although this may seem inconceivable given that a large part of the number of vacant positions requires few qualifications, there are several reasons that can explain this imbalance, including income support benefits (PCU, PCRE, etc. .) and fears for the health of several workers.
But the pandemic also appears to have had a more profound impact on workers’ decisions about work.
Many have taken advantage of the pandemic to reorient themselves towards more promising sectors and professions, but also which allow a better work-life balance. The changes in habits brought about by the pandemic and the better employment prospects for workers could have the effect of modifying the dynamics of the labor market more durably. The consequence is a prolonged shedding of low-paid jobs that offer poorer working conditions.
Last August in the United States, more than 4 million Americans tendered their resignations – what has been dubbed “The Great Resignation” – as vacancies soar. Although no cataclysm of such magnitude is perceptible in Canada and even less in Quebec, it is possible that the search for the “best jobs” partly explains the persistence of long-term unemployment and creates new imbalances in the labor market. ‘use.
The future will tell us which transformations induced by the pandemic will be the most persistent, but until then, it will be important to closely follow its evolution in order to make the right diagnoses and apply the appropriate solutions to mitigate these imbalances. . Because contrary to what some claim, it is not labor shortages that improve people’s lot, but full employment. The two should not be confused. Shortages have economic and social costs – we can see this in the health care system.
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