2021 QUEBEC JOBS REPORT - A RECOVERED LABOUR MARKET, ALBEIT RESHAPED BY THE PANDEMIC

MONTREAL, Feb. 17, 2022 /CNW Telbec/ - "After being hit hard by the pandemic, the labour market has bounced back quickly and decisively, but there's no question it has been transformed," said Mia Homsy, Chief Executive Officer of the Institut du Québec (IDQ). "Between December 2020 and December 2021, people returned to work in droves (+156,900) and jobless numbers tumbled (- 94,900). The public health crisis has nevertheless exacerbated some of the flaws that were already there and brought new challenges to the fore." In its report on employment in Quebec in 2021 (Bilan 2021 de l'emploi au Québec : Transformations sectorielles et déficit de compétences en vue), released today, the IDQ has shed light on a few key questions that have recently emerged, in an effort to provide a clearer understanding of the state of the labour market and identify trends that may very well be here to stay.

How are the hardest-hit groups faring?
Despite the fact that the overall employment situation is pretty much back to normal, some segments of the labour market are still lagging behind, chief among them experienced workers, i.e., those aged 55 and older. In this group, the gender disparity is particularly striking, with many more women (-25,700) dropping out of the labour force than men (-9,400) since December 2019.

Although there was a mass return to work in the summer of 2021 for young workers in Quebec (15–24), employment rates for young men have yet to rebound to pre-pandemic levels, which stand in stark contrast to their counterparts in Ontario and Canada as a whole. In Quebec, the employment rate gap between men and women in this age group widened from 2 to 6.2 percentage points since December 2019.

Job figures for immigrants were particularly rosy: at the end of 2021, their employment rate (82.9%) was up over December 2019 (78.4%). Interestingly, recovery has been strongest among landed immigrants who have been here for less than five years (75.8% versus 62.9% for the same period). 

Has the "Great Resignation" come to Quebec?
Reports from the United States indicate that millions of workers have quit their jobs since the onset of the pandemic. But the situation is much different in Quebec and the rest of Canada, where the return to the labour market has brought figures back closer to 2019 levels. The labour force participation rate among Quebecers 25 to 54 has actually risen and is now greater than what we see in Ontario and the rest of Canada.

Moreover, none of the available data indicates that more people took early retirement in 2021, although the participation rate among experienced workers has indeed declined. The evidence instead suggests that a significant number of workers 55 and older who were neither employed nor unemployed felt compelled to leave the labour market due to pandemic concerns, the corresponding health risks and other related issues. This leaves the door open to a possible return once the public health crisis recedes.

Have workers flocked to new industries or occupations? 
One of the phenomena that has transformed the labour market during the pandemic has been the tendency for workers to shuffle from one industry to another. Many Quebecers appear to have turned their backs on sectors that have been upended by public health restrictions (accommodation, food services and retail) to explore opportunities in growing fields such as education, professional services, finance, insurance and public administration.

Fewer people seem to have opted for a change of occupation than a change of industry. Job losses have been disproportionate in sales and service-related professions (servers, sales representatives, etc.) where the number of workers fell by 135,700 in the past two years. On the receiving end of this shift were careers related to education, law, social services and natural sciences, which together saw close to 100,000 new jobs be created in Quebec for this period.

Are wages growing at an accelerated pace?
As the labour market regained momentum in 2021, so did wages. Although growth in wages was relatively modest (2.1%) in an economy marked by vigorous recovery, a shortage of qualified workers and rising inflation, it did pick up steam at the end of the year, resulting in an average annual percent change of 3.4%.

An analysis of the available data shows that growth in wages outpaced inflation between 2008 and 2020, but the trend reversed during the pandemic. Real wages (i.e., wages adjusted for inflation) have grown steadily in Quebec since the 2008–2009 financial crisis. A drop was observed between 2020 and 2021, but not to the extent that workers were put at a greater disadvantage than in 2019. Accordingly, even though wages have been increasing more quickly since mid-2020, this growth has not kept up with inflation.

What are the challenges on the horizon for 2022?
Despite the significant upturn in the labour market, there are a number of lingering issues to be addressed. The need to adapt to ongoing changes will therefore be paramount moving forward. Some of the challenges that have been brought into sharp relief after two years of pandemic turmoil include the following:

• The aging population has affected and will continue to affect potential labour supply while demand continues to grow. The explosion in the number of vacant positions has only aggravated the situation and intensified shortages in most industries.
• Some groups of workers, including those in the 55+ age group, are not fully back to work. Enticing the early retirees among them to return to the labour market to address labour shortages will be no small feat.
• The accommodation, food services and retail industries could be up against some persistent recruiting problems. This may require them to rethink their business models and work organization, even after the pandemic has subsided.
• With more opportunities available to work from home or in hybrid mode, jobs that do not offer this option may become less attractive to potential employees.
• Some employers struggling with recruiting issues may have to consider lowering their hiring standards, especially those related to academic credentials. The educational requirements for a given job may therefore not be as stringent as they were two years ago. If this is not offset by an increased focus on professional development and in-house training, companies' overall competitiveness may suffer as a result.
• More and more professions will be looking for candidates with stronger reading comprehension, writing and complex problem-solving skills, whereas Quebec and the rest of Canada are already struggling with delays in digital literacy. The needs for highly qualified workers will continue to grow, especially in health care, social assistance, educational services, information technology and construction.

"We have begun 2022 with one of the lowest unemployment rates in years and a record number of job vacancies. With a dwindling pool of potential workers and a considerable decrease in the labour market participation rate among those 55 and up, unless businesses, unions, schools and governments embrace a substantial shift in their approach to human resources management, the labour shortage will undoubtedly be the biggest obstacle to recovery," concluded Homsy. 

For more information
The original report (in French) can be downloaded here : Bilan 2021 de l'emploi au Québec : transformations sectorielles et déficit de compétences en vue. 

About the Institut du Québec
The Institut du Québec is a non-profit organization that conducts research and analysis on contemporary socioeconomic issues in Quebec. The IDQ's focus is on providing public authorities, the private sector and civil society with the necessary tools to make informed decisions and thereby help to build a more dynamic and prosperous society.

institutduquebec.ca | @InstitutduQC

SOURCE Institut du Quebec

Liette D'Amours, Media Relations Officer, 514-649-2347, [email protected]