The shortage of labour does not decrease

Archival Photo Daniel Mallard

QMI agency

Thursday, 1 march 2018 12:39

UPDATE
Thursday, 1 march 2018 12:46

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QUEBEC – The shortage of labour in Quebec and in several parts of Canada do not seem near to stop.

“The number of vacancies has increased significantly (in Canada) in recent months,” said the chief economist of Desjardins, Benoit P. Durocher, in his most recent bulletin, released Thursday.

According to Statistics Canada data, the number of unfilled vacancies rose in the land of 217 700 in November 2016 to 299 300 a year later, “an increase of almost 40 %,” notes Mr. Durocher. During the same period, the unemployment rate experienced a marked decline, amounting to 5.8% for Canada as a whole and 5.4% in Québec.

“The combination of an increase in the number of vacancies and the decrease in the number of unemployed has resulted in a significant decrease in the ratio of unemployed persons per vacancy,” writes Mr. Durocher.

If we analyze this ratio by province, we find that the shortage of labour is the highest in British Columbia, with 2.2 unemployed per vacancy, followed by Quebec where the ratio is 3.8 unemployed people per vacancy.

In contrast, in Newfoundland and Labrador, the ratio is 14.9 unemployed people for every open position.

Inflation

This situation of shortage doesn’t bode well for inflation and interest rates, said Mr. Durocher.

“Because of this scarcity, he writes, we must therefore expect that wage growth remains fairly high over the next few months.”

“Ultimately,” he continues, ” this could exacerbate inflationary pressures in the country and have consequences on the evolution of interest rates.”