Seasonal employment adds to a tight job market that may not last: Don Pittis
A need for workers is starting to push wages higher, but economists worry jobs boom will end
Amid glittering piles of treats at the Lindt chocolate shop at Toronto's Eaton Centre, a potential customer entering the store is welcomed by two smiling employees dressed in black.
On a midweek morning employees outnumber customers because at this time of year — as at so many Canadian retailers and the companies that serve them — the shop has been on a seasonal holiday hiring binge.
"It's about double," says store manager Paul Bullen of the number of holiday staff.
Seasonal bulge
The retail employment bulge means a predicted decline in Canadian employment growth may be pushed forward at least a few more months. And those seasonal jobs, although not the high-tech, high-pay employment our economic leaders say is so important, are boosting the quality of Canada's future workforce.
Those jobs numbers perform a dual function. Collected only weeks before their release, they vie with auto sales as one of the freshest indicators of how the wider economy has been doing in the recent past.
But the number and quality of the jobs created in any month are also the foundation for future economic strength in the public and private sectors because a well employed population has money to spend and incomes to tax.
Jobs prevent a slump
Not only that, but according to traditional economics, as indicated by the Phillips Curve, stronger employment is key to pushing inflation from its current low up to healthy levels.
In Canada's biggest cities, jobs growth is helping prevent a slump in real estate prices, said Bank of Canada governor Stephen Poloz this week.
The Organization for Economic Co-Operation and Development, the rich countries' think-tank, also weighed in on jobs this week. It described how, after a long period of stagnation, a rise in wages has begun.
"The unemployment rate is down by three-quarters of a percentage point from a year earlier, and more people are coming into the labour force," observes the OECD's latest report on Canada released Tuesday. "Wage increases are still weak but are beginning to pick up, reaching around two per cent over the past 12 months."
Moderate increases in wages are a good sign. Not only do they help to redistribute wealth in the economy, but they signal that the deep reserves of available workers are gradually being used up.
Stepping-stone jobs
While seasonal retail jobs may not be the kind of work that a high-tech industrial economy would prefer, they are not all bad-paying, and the season seems to be getting longer, says Jodi Kasten, Canadian managing director for the job search company Indeed.
"We're looking at data from September, which is early, but all indications are that 2017 seasonal hiring has actually beat previous years," says Kasten. She says wages for the jobs her site posts run from $13 to $17 an hour with truck delivery jobs for online sales some of the best paying. Training for those more technical jobs may be a reason for earlier hires, she said.
One of the sources for seasonal workers is Canada's universities and colleges, where classes often end in time for the seasonal rush, says Gail Langlais, director of career services for the University of Manitoba.
While they may not be the kinds of jobs the students imagine for their careers, Langlais says short-term, relatively low-paying jobs are crucial for building the kind of high-level workforce Canada needs.
She says that while students are taking courses in high technology and academics, a retail job demonstrates someone has learned skills they might not have picked up in class.
Transferable skills
"They're the skills employers are looking for," said Langlais, pointing to things as simple as showing up on time and smiling when you don't especially feel like it, to higher level universal skills such as dealing with money and selling a product or idea.
"We really look for those transferable skills in individuals," she says.
It's well known that a short supply of entry-level positions as people join the job market during recessions can plague someone's entire career, as a lack of experience blocks advancement.
So far, the Canadian economy's job-creation engine has been outpacing the supply of new workers, but the OECD and the Bank of Canada warn that could change in the coming year, especially if high consumer borrowing and an overheated property market turn to bust.
"Growth has been led by household consumption, which should slow as rapid job growth and wealth effects from house price appreciation abate," said the OECD.
But the OECD has been wrong before, and the extra jobs created by the season of retail consumption will likely keep the gloom at bay for at least a few more months.
Follow Don on Twitter @don_pittis
More analysis from Don Pittis
ABOUT THE AUTHOR
