Low-wage and middle-wage jobs in Canada are shrinking as a share of the economy as job growth focuses more and more on high-skilled, high-end jobs, says a new report from TD Bank.
While the U.S. economy has seen a “hollowing out” of middle-wage jobs, and a relative increase in low-wage and high-wage jobs, Canada is only experiencing a boom at one end — at high-skilled end of the spectrum, TD said in a report that analyzed detailed data for 123 different occupations.
“North of the border, the winners win more, and the losers lose more,” a chart in the report declares.
Medium-skilled jobs — defined as those requiring more than high school but less than a full university degree — are ones that “tend to carry out functions that follow precise, repetitive procedures,” the TD report stated. “As such, these workers have become increasingly vulnerable to computer automation or outsourcing to low-wage jurisdictions, such as China and India.”
By contrast, high-skilled jobs require “complex decision-making” and “face-to-face interactions” that make them difficult to automate or outsource, the TD report said.
But while the U.S. has seen an increase in low-end jobs — for instance, in the food service sector — Canada has seen no such increase in its share of low-end jobs, the report stated.
“The relatively strong demand for low-end jobs in the United States reflected an outsized 20 per cent surge in the share of personal services jobs. In Canada, this area actually recorded a modest dip.”
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Wood Mountain (includes oil rich Fort McMurray, pictured here) saw its employment level shoot up by 95% over the 2000 to 2011 period, while forestry based Miramichi suffered the biggest decline of 63% in job numbers. Two out of 33 Census Metropolitan Areas (Windsor and Thunder Bay) had fewer jobs in 2011 than in 2000 while 13 of 45 smaller cities were in this situation. In 2011, only 5.5% of the labour force in Wood Mountain were unemployed while 16.4% were unemployed in Miramichi. -- People Patterns Consulting
The unemployment rate jumped from a near record low of 6.1% in October 2008 to a high of 8.7% high in August 2009 and has declined slowly since then to 7.2% in March 2012. In spite of the recovery, unemployment duration increased again in 2011. There was a another slight decrease in the number of discouraged job searchers in 2011, who just quit looking because they believed that nothing suitable was available, but their numbers were still 50% above pre-recession levels. Actual hours worked at all jobs advanced to 36.4 hours in 2011 up 24 minutes from the all-time low of 36 hours in 2009. Real (after removing inflation) average weekly wages fell by 0.5% in 2011 following an increase of only 0.2% in 2010. This helps explain why the number of workers who have more than one job climbed for a third straight year to a record 5.4% in 2011. Women (6.4%) are now more likely to have a second job than are men (4.5%) while both were the same (4.6%) in 1989. -- People Patterns Consulting
In 2011, the employment rate for lone-parent mothers (55%), lone-parent fathers (79%) and mothers with an employed husband present (70%) all with children under the age of six continued to be below their prerecession peaks. The only exception in 2011 was for women with a non-employed husband for whom the employment rate (53%) was above the pre-recession rate. The "monetary" value of childcare remains undervalued. In 2011, childcare and home support workers working full-time (30 hours or more per week) earned an average of $598 per week. This was the third lowest behind full-time chefs and cooks ($545) and retail sales persons ($589). On a more detailed level, babysitters, nannies and parent helpers were the lowest paid occupation from among over 700 occupations in the 2006 Census. -- People Patterns Consulting
After eight years of decline, the manufacturing sector created only 15,900 jobs in 2011. Employment in 2011 was about where it was in 1993 and down by 532,200 jobs since the peak in 2004. Based on employment growth over the 2000 to 2011 period, the most rapidly expanding industries in Canada were mining and oil and gas extraction (+70.3%) and construction (+56.4%). Other leading growth industries (all service related) included professional, scientific, technical services (+39.9%), health care and social assistance (+37.9%) and real estate and leasing (+30.1%). -- People Patterns Consulting
For 2011 as a whole, eight (35%) out of the 23 major occupations were in a shortage situation, compared to six occupations in the previous year but still much less than the 10 occupations before the recession began. When examined from an industry basis, there were shortages in five (25%) of the 20 sectors in 2011, up from four during the previous year. In 2011, the unemployment rate among professional occupations in health, nurse supervisors and registered nurses stood at only 0.8%. Unemployment was only 1.9% in technical, assisting and related occupations in health and in professional occupations in business and finance. Demographics point to more shortages in the medium-term. -- People Patterns Consulting
Based on a ranking of 10 youth related indicators, Alberta was the best place for youth in 2011 followed by Saskatchewan in 2nd spot and Quebec in 3rd spot. Next in line were Manitoba (4th), Prince Edward Island (5th), British Columbia (6th), Ontario (7th), New Brunswick (8th), Newfoundland (9th) and Nova Scotia (10th). At the national level, recession is still the reality for youth. Youth employment plummeted by 195,400 jobs in 2009 and 2010 combined but only 19,300 jobs came back in 2011. In 2011, employment rates for all youth slipped further to 55.4% (lowest since 2000), was flat for returning students working in the summer (53.8%) but down a lot for full-time students who were working during the school year (36.6%). In 2011, the unemployment rate improved slightly for all youth (14.2%) but worsened for returning students working in the summer (17.4%). -- People Patterns Consulting
More and more seniors are working longer. The percentage of those aged 60-64 who are employed rose from 34% in 1989 to 47% in 2011 ... a new record. The percentage of those aged 65-69 who are still working jumped from 11% in 1989 to 23% in 2011 ... another new record. The percentage of the 70 and over group who are still working increased to 6% in 2011 ... one more record high. Over the 1989 to 2011 period, the labour force aged 45-54 more than doubled (+108%), those aged 55-64 also more than doubled (+133%) while those aged 65 and older grew even faster (+180%). The recession delayed retirement for many, as record numbers of persons 60 and older remained in the paid workforce. The median retirement age among men (63.2 years) rose for a third consecutive year in 2011 and was the highest since 2003. The median age of retirement among women increased to 61.4 years in 2011 and is the second highest since 1994. -- People Patterns Consulting
But the report stresses that the “hollowing out” trend in Canada has been less pronounced than in the U.S. TD attributes this to strength in construction and the jobs boom in mining, oil and gas. Many jobs in those areas are considered middle-skilled jobs.
“Construction-related trades in particular posted double-digit increases in their shares since the late 1990s and now account for almost 5 per cent of total Canadian employment,” the report stated.
Yet even a housing market that was booming until recently, and solid job growth in mining, oil and gas, was unable to keep the share of middle-skilled jobs from declining.
And with housing starts data showing a sharp slowdown in construction activity, this area may not do as much to hold up Canadian middle-skilled in the near term.
There was some good news in the report, though: While in the U.S., high-skilled workers are running away with wage gains, in Canada, TD reports, wage gains have been spread out more evenly, going even to low-wage workers."The average annual growth in wages across the 10 skills groups has run in a strikingly tight range of 2.5-3.5 per cent annually. As such, the gap in average wage levels between skilled workers and their lower-skilled counterparts has continued to increase since 1999, but not as much as one might have suspected."