The Canadian economy has been on a bit of a roller coaster ride over the past decade. Unemployment was in the 10 percent ballpark in 2008, but that rate has since declined sharply, down to 5.9 percent in November, the most recent month for which data is available. Will the jobless slide continue heading into the new year? A recent survey suggests troubled waters may be on the horizon for business owners, potentially resulting in increased turnover.
The problem stems not necessarily from workers themselves, but the positions they've been offered, many of which don't carry much in the way of job security. For instance, according to a poll from Hays Canada, temporary hires were two times higher in 2017 compared to what companies anticipated heading into the year, fueled by economic realities that prevented them from hiring on a full-time basis. Furthermore, of the business owners who took part in the survey, more than 50 percent said their workers' salaries will go up less than 3 percent in 2018, despite their acknowledgment competitors may be offering higher levels of compensation.
Employment growth to continue next year
But business owners are far from pessimistic about 2018. To the contrary, roughly 70 percent of respondents in the Hays survey said they're encouraged about their growth prospects in 2018 and beyond. Additionally, around 33 percent said they intend to recruit more people for full-time work.
Rowan O'Grady, Hays Canada president, noted that it's this optimism and positive business owner sentiment that may prompt unsatisfied employees to seek out greener pastures.
"The dark days of the downturn are a fading memory for most of Canada's employers, but our research shows they're staring down the barrel of extreme retention challenges," O'Grady explained. "When the economy and job markets are strong, employee tolerance for not getting what they expect drops considerably. Frankly, employees have already told us they are ready to be lured away."
One place that's hiring in droves is Ontario. In November, job growth jumped by 44,000 in the province, according to Statistics Canada's most recent data, with the biggest gains observed in the retail, wholesale and manufacturing sectors. Unemployment, as a result, fell to 5.5 percent, Ontario's lowest jobless rate in more than 17 years. In year-to-date estimates, an additional 181,000 people are back to work in Canada's most populated province who weren't in 2016.
Ontario salaries swell
Salaries are higher as well, causing household spending to increase, given they have more discretionary income. In nominal terms, compensation levels rose 1.3 percent during the third quarter, based upon estimates from Statistics Canada, the most substantial uptick observed in the previous 11 consecutive quarters. The largest growth was observed in Ontario and Quebec.
Given workplaces seem to be more willing to pay more to woo potential job hoppers, it perhaps comes as little surprise that nearly 60 percent of respondents in the Hays poll would jump ship if a better work opportunity came their way.
Contributing to their dissatisfaction is work overload - something that their bosses acknowledge. Almost three-quarters of business owners admitted their staff appears stressed more often than not, which is adversely impacting company morale.
O'Grady reminded employers to be mindful of their current crop of workers and ensure that they understand how much they're valued.
"When overworked teams get little in the way of raises but see their employer inflate salary offers to incoming candidates, they tend to look for the exit sign," O'Grady advised. "We expect this is already happening and 'churn' will be the big word in 2018."
Human resources experts recommend increasing workers' pay when there are signs of ongoing improvements and consistently perform. Their maintaining a positive attitude is also a key character trait that should be taken into account.