This past June, there was a spike in job openings in accommodation and food services in Canada.
As restaurants started reopening in June, there were 129,100 vacant positions in accommodation and food services jobs, according to Statistics Canada’s job vacancy report. There were more openings in this sector than even health care and social assistance, which had the highest number of vacancies the month before. Canada’s retail trade sector came in third place.
Job vacancies in food services drove up the number of vacant positions in Canada. There were a total of 815,800 job openings in June, a 22 per cent increase from May. The majority of these openings were in service sectors.
June also had the highest job vacancy rate since Statistics Canada started collecting data in October 2020. There is a difference between the job vacancy rate and the number of job vacancies. The vacancy rate is the proportion of vacant positions compared to the number of all positions in a sector. In June, Canada’s overall vacancy rate reached 5 per cent.
Accommodation and food services also had the highest job vacancy rate of all sectors at more than 12 per cent. Employers were actively recruiting to fill vacant positions as restaurants began opening up outdoor dining starting in late May.
Among the provinces, B.C. and Quebec had the highest job vacancy rates. Manitoba and Nova Scotia had the lowest job vacancy rates.
Labour shortages expected to intensify
A recent RBC report suggests that labour shortages will continue to increase in the coming months.
In 2020, workers held off retiring and switching jobs due to dissatisfaction amid the period of overwhelming economic uncertainty. These workers may now start quitting their jobs, which would drive up the number of vacant positions.
Also, many workers in service sectors that were affected by the pandemic may have left their positions due to extended shut downs.
Economist Carrie Freestone, who authored the report, says a high job-vacancy rate can drag economic growth. Businesses may be forced to operate at reduced capacity. Employees are now in a stronger bargaining position to negotiate higher wages and better benefits. Also, the tight labour market may put upward pressure on wages, leading to higher consumer prices.
Provinces with the highest job vacancy levels may face challenges hiring for lower-paid positions. Although wages in accommodation and food services were up in June, average wages remained 57 per cent below other service-sector jobs. This may explain the increase in food services vacancies, and may continue to affect the sector if workers have left permanently.
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