Bank of Canada survey finds hiring intentions weaken, wage growth slows
Canadian employers seem to be easing on their efforts to hire more talent, based on a recent report.
Specifically, the balance of opinion (percentage of firms expecting higher employment levels minus the percentage expecting lower employment levels) when it comes to employment intentions stood at 35% in the fourth quarter of 2022, reported the Bank of Canada.
That was considerably below the 47% recorded in the third quarter of last year, 66% in the second quarter and 63% in the first three months of 2022.
It was also less than half of the same data recorded in the fourth quarter of 2021 (77%).
“Several businesses expecting weaker demand are taking a cautious approach to hiring,” said the Bank of Canada. “Still, almost half of firms mentioned they plan to add staff to meet anticipated sales growth or to fill vacant positions.”
Canadian employers anticipate a “brisk” hiring climate for the first quarter of 2023, according to a separate report.
Labour shortages
A growing number of firms characterize labour shortages as less intense than last year, and this signals an easing in some labour markets, said the Bank of Canada.
And 51.49% of firms said labour bottlenecks would be the most important obstacle to meet an unexpected increase in demand. That’s down from 62% in Q3, 62.38% in Q2 and 59.41% in Q1.
This was also much lower compared to the 59% recorded in the fourth quarter of 2021.
In contrast, just 22.77% of employers said that supply chain bottlenecks would be the most important obstacle to meet an unexpected increase in demand.
Three quarters of Canadian employers are highly concerned about recruitment heading into 2023, according to another study.
Wages down
Expectations for faster wage growth are also less widespread during the fourth quarter of 2022, according to the Bank of Canada.
Overall, the average expected wage increase on a year-on-year percentage change during that period was 4.66%. That has dropped from 4.92% during the previous quarter and from the record-high 5.84% recorded in the second quarter of 2022. The same data stood at 5.16% in Q1.
Still, the wage growth eclipsed the 3.22% wage growth recorded in the last quarter of 2019, just before the COVID-19 pandemic hit.
