Thousands of jobs are going to beg, more to come and the unemployment rate in London is still rising.
The question is why?
The unemployment rate in London rose to 6.1 percent for the third straight month in July, contradicting the national trend that has left Canada with a record low of 4.9 percent, which is about as close to full employment in this country. .
But while the national rate has remained stable, even with more than a million job openings in Canada, the rate in the London area has risen again amid a growing pile of available jobs – more than 6,000 posted to employment agencies in the region, and there are more are coming. as major employers, such as food giant Maple Leaf Foods Ltd. and online retailer Amazon, are completing major new operations that they are building here.
How can both things – the unemployment rate and the sheer number of unfilled jobs – rise at the same time?
Analysts say a mix of factors could be at play, including more people looking for work to enter the job market, and being factored into monthly unemployment figures, such as the latest snapshot released Friday, and others being more picky about the type of job they have. want.
Still other employees simply don’t have the skills employers need to fill many of the positions available.
“When people think they can find a job and they start their search . . . that puts pressure on unemployment, but when that happens, it is positive for the labor market,” says Audra Bowlus, professor of economics at Western University.
“The other thing that can happen is that we have a mismatch between the people who are unemployed and looking for work, and the vacancies that are available now,” she said, adding that “that’s more of a problem.” if that is the case.
The explanation is likely somewhere between the two, she said.
If you ask Jason Bates, chairman of the London Region Manufacturing Council, part of the problem is the need for better trained staff.
“There is certainly not enough talent available, especially in skilled occupations,” he said. “That has been a persistent problem for years.
“There are a lot of people who are retiring and there just aren’t enough new talent coming in to replace a lot of those people who are leaving the workforce.”
Filling certain jobs has become such a challenge that it hurts the pace at which some companies grow.
It has also led some companies to look to automation to solve long-term workforce shortages, Bates said.
“A lot of plants look at it in a different light,” he said.
A survey of businesses in the London area this year by the regional workforce planning council found that nearly two-thirds of employers struggle to get their hands on a sufficient workforce, with a lack of qualified workers being the main problem.
But Bates also said manufacturers are struggling to find workers for less skilled positions, including entry-level and other administrative jobs.
It’s not just a manufacturing problem, said Kapil Lakhotia, head of the London Economic Development Corp.
“We know there are many industries in this region that are growing significantly and are desperately looking for more workers,” he said.
“What we’re hearing from employers is that, despite the unemployment rates, they’re just not getting the number of applications for the job openings being advertised.”
If that’s the case, job seekers may have become more selective and seek better-paid work amid the rising cost of living or more flexible work arrangements such as working from home, Bowlus said.
She said that when employees know there are enough jobs available, they are less likely to settle for what they can get.
“They have what we would call a ‘high reservation wage’,” she said.
“They want top money for their skills, which is why they are unwilling to take jobs in the service sector if they think they can do better. So they are very selective in what they request.”
If Canada enters a recession, as some analysts believe, the mindset and behavior of job seekers will likely change, Bowlus said.
Lakhotia said he is aware of the rumblings of potential economic problems ahead but is confident that the London area economy, with its mix of many different types of employers, can withstand the impact.
“The diversity of our economy helps us survive economic cycles better,” he said.
“While we cannot control the global economic conditions at our neck of the woods, we have many growing employers and solid demand for workers. And we expect this to continue with a pipeline of new projects already underway.”
The number of people working in the London area in July was 294,900, about 30,000 more than in February 2020, just before the start of the pandemic.
The figures include St Thomas, Strathroy and parts of Elgin and Middlesex counties.
The area’s employment rate — the proportion of people of working age who are employed or seeking work — was 66 percent in July. That ratio has been fluctuating in that range for months, up from 57.2 percent three years ago, when it was one of the lowest in major city Canada.
Canada’s unemployment rate remained at 4.9 percent in July, an all-time low, unchanged from June amid a national labor shortage.
The market remains exceptionally tight, with more than a million job openings and the lowest unemployment rate ever based on comparable data dating back to 1976.
– with Canadian Press file
Unemployment Rates for July vs. June
LONDON: 6.1 percent (5.8)
Ontario: 5.3 percent (5.1)
CANADA: 4.9 percent (unchanged)