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Looking-Ahead: A 10-Year Outlook for the Canadian Labour Market (2006-2015) 

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Ten-Year Outlook for the Canadian Labour Market (2006-2015)

The Canadian Labour Market Outlook

The Canadian labour market is expected to perform well over the next decade, with no widespread labour shortages emerging

Total employment is expected to grow from 16.2 million in 2005 to 18.1 million in 2015 — an average annual growth rate of 1.1%. Although this represents a slowdown relative to the 2001-05 period (when the rate of growth was 1.8%), the Canadian economy should still create about 1.9 million new jobs over the next 10 years. Employment growth will be much stronger in the first five-year period:

• Employment is expected to grow at an annual average rate of 1.4% over the next five years (2006-10), leading to the creation of about 1.2 million new jobs. Given that the labour force is expected to increase by 1.3%, the unemployment rate will decrease gradually to reach 6.0% in 2010, down from 6.8% in 2005.
• Over the 2011-15 period, employment growth (0.8%) is expected to slightly outpace labour force growth (0.7%), resulting in the unemployment rate reaching 5.6% by the end of the period. Another 700,000 new jobs will be created in this second period.

This employment forecast is affected by projected changes in economic activity and productivity. Over the next five years, Canada's real GDP is expected to advance at an average annual rate of 2.9% before slowing down somewhat to reach 2.6% a year over the following five-year period. The major factor behind this deceleration is a slowdown in the underlying growth potential of the economy, as slow overall population growth will constrain labour force gains. The aging of the population will have an additional dampening effect on labour force growth as a result of retirements. As inflation has largely remained within the Bank of Canada's target band (between 1% and 3%) for many years now, it is expected that the Bank will be able to set monetary conditions that allow demand to grow in line with this slower growth in potential. Accordingly, a sustained generalized shortage of workers is not expected to materialize in the Canadian labour market. For more details on macroeconomic, demographic and labour force projections (methodology and results), click here

Growth in labour productivity (as measured by output per worker) is expected to average 1.6% over the next 10 years, exceeding the average rate of 1.1% experienced over the 1976-2005 period. The main factors driving this strong rate of labour productivity gains include the growing proportion of highly educated workers in the labour force and a rising capital-to-labour ratio that is being fuelled by both strong machinery and equipment investment and slower overall labour force growth.

Employment Growth by Industry

Employment growth is expected to be fastest in service-producing industries

Demographic and macroeconomic developments will lead to changes in Canada's industrial structure. First, slower population growth is expected to reduce output and employment growth for most industries, while changes in the age structure of the population will have an impact on the industrial structure by favouring service-providing industries, particularly in the health sector.

Other structural trends will also have an impact on Canada's industrial mix, including the continuing shift towards a more knowledge-based economy, globalization and reduced accessibility to some natural resources. Finally, cyclical events such as the pick-up in demand for aeronautical equipment, higher oil prices and the improved fiscal outlook of governments will significantly impact growth in several industries.

Over the next 10 years, employment growth in the service sector will outpace that in the goods-producing industries, continuing a trend that began in the late 1980s. Employment in the service sector is expected to rise at an annual average rate of 1.2% (an increase of nearly 1.6 million jobs during the 2006-15 period). In the goods-producing industries, the average annual rate of new job creation, at only 0.8% (slightly more than 0.3 million jobs), will be less than the average of 1.1%.

This employment growth gap in favour of the service sector can be attributed to the expected strength of labour productivity in the goods-producing industries. Manufacturers are expected to continue to enhance productivity in order to remain competitive in the face of the strong Canadian dollar and intense international competition. In fact, GDP growth in the goods-producing industries (annual rate of 3.0%) is forecast to outpace that in the service sector (2.7%). This is in contrast to the 1987-2005 period, when the reverse was true.

Among the service industries, employment growth is expected to be strongest in computer system design, health and professional services. These industries will benefit from increases in public spending in health care made possible through improvements in the fiscal position of governments, the continuing movement towards a knowledge-based economy and increased investment in research and development (R&D). However, some industries are expected to experience below-average employment growth — public administration, as larger quantities of public funds are directed towards health and education; the finance, insurance, real estate and leasing sector, given the anticipated slowdown in real estate and mortgage lending and stronger productivity; and the education sector, as a result of the expected slowdown in population growth.

Among the goods-producing industries, employment growth in the oil patch is expected to be above the economy-wide average during the 2006-15 period. High energy prices will stimulate investment spending in this sector, thereby contributing to employment growth in oil and gas extraction (average annual growth rate of 2.0%), support activities for mining and oil and gas extraction (1.9%) and construction (1.3%). In the other primary industries, employment growth will be below average, including forestry (-0.6%), mining (0.2%) and agriculture (0.3%). Finally, in manufacturing, the employment growth outlook is limited: for the sector as a whole, the annual average rate should be 0.6%. However, there will be marked differences within this large sector. Employment growth should be strong in computer and electronic products, some categories of transportation equipment (aerospace products and parts) and metal products and machinery, while in pulp and paper, wood product manufacturing, printing, other manufacturing industries (mainly textiles, clothing and furniture) and motor vehicle and parts manufacturing employment is expected to decline.

For GDP and employment projections by industry (methodology and results),click here

Employment Growth by Occupation (expansion demand)

More than two thirds of all new jobs are expected to be in occupations usually requiring postsecondary education or in management

New job creation¹³ within occupations is influenced by two main factors:

• how the industry employing people in a particular occupation evolves; for example, job creation among carpenters, masons and plumbers is dependent on the outlook for the construction industry;
• how a particular occupation is affected by structural factors; for example, employment for general office clerks has dropped because of the development of office automation (computers, email, voice messaging systems, etc.) in favour of more specialized employees such as administrative clerks or information officers.

Over the next 10 years, more than two thirds of the 1.7 million new non-student jobs created (69.2%) are expected to be in occupations usually requiring postsecondary education (university or college) or in management.¹⁴ In 2005, approximately 60% of all non-student workers had jobs in these categories.

Expansion Demand by Skill Level, 2006-2015

	Non-student employment (000s)		Growth (AAGR1)	Change (000s)	Share of change
	2005	2015	2006-2015
Total	14,566.8	16,263.8	1.1%	1,697.0	100.0%
Skill level2
Management	1,376.7	1,547.0	1.2%	170.3	10.0%
Occupations usually requiring:
- university education	2,525.8	2,971.2	1.6%	445.4	26.2%
- college education or apprenticeship training	4,843.2	5,402.6	1.1%	559.4	33.0%
- high school diploma	4,353.3	4,778.2	0.9%	424.9	25.0%
- only on-the-job training	1,467.5	1,564.8	0.6%	97.3	5.7%
Source: HRSDC - SPRD, Labour Market and Skills Forecasting and Analysis, 2006 Reference Scenario. 1AAGR: average annual growth rate. 2Skill levels are based on the 2001 NOC Matrix, in which occupations are grouped according to the education level and training normally required.

Among the occupations that generally require postsecondary education or that are in the management group, demand will be particularly high for those usually requiring a university degree: employment in this category is projected to increase by an average of 1.6% annually between 2006 and 2015. This rapid growth is explained in part by the continued shift to a knowledge-based economy and by increased public spending in the health care sector.

Employment growth will be somewhat lower in the other occupations within the high-skilled occupational category. However, growth in new job creation for management occupations (annual average rate of 1.2%) and occupations generally requiring college education or apprenticeship training (average rate of 1.1%) will be nonetheless greater than or equal to the economy-wide average.

Job creation will be weaker in lower-skilled occupations. For those usually requiring only on-the-job training, the average growth rate will be only 0.6% annually, whereas in occupations usually requiring a high school diploma, the average will be 0.9%. For employment projections by occupation (methodology and results), click here

The above results used the National Occupational Classification (NOC) to identify the skill levels where new job openings will emerge. An alternate methodology is to use data on educational attainment.¹⁵ Within each occupation, workers aged 25-44 are classified among four levels of education (less than high school, high school, college and university), based on the last three years of available data (2003-05 period). These educational proportions by occupation are then used to estimate the educational requirements of the new jobs. Results using this alternate method also show that more than two thirds (69.3%) of new jobs will require postsecondary education (either college or university).

Labour Force by Educational Level

The level of educational attainment of Canada's labour force will continue to rise, albeit at a slower pace than in the past

The labour force with postsecondary education (university and college) is projected to continue to be the fastest-growing component of supply.¹⁶ The major cause of the increase is the continued impact of the large proportion of young people with postsecondary education (PSE) — 65.5% of the labour force aged 25 to 29 had PSE in 2005 — as they replace less educated, older workers (about 55% of those aged 55 to 64 had PSE in 2005).

More specifically, the cohort of individuals with a university degree, which accounted for 13.8% of the labour force in 1990 and 21.8% in 2005, is expected to rise by 2.2% on average over the next 10 years to reach 24.4% of the labour force in 2015. On the other hand, the labour force with less than high school education is expected to continue to decline by an average of 1.0% a year. Accordingly, its share of the whole labour force is expected to drop from 14.6% in 2005 to 11.8% in 2015 — less than half what it was in 1990 (28%). The shares of the labour force with a college or high school education are expected to remain fairly constant — at 34% and 30%, respectively.

Although the educational attainment of the labour force will continue to advance, the rate at which it does so will slow down. The baby-boomers were much more educated than their parents; their own children are also more educated than their parents, but by a narrower margin.

Labour Force by Skill Level

The fastest labour force growth will take place in occupations usually requiring university education

One might want to compare directly employment creation by occupation (skill level) to increases in the labour force by education level in order to assess future imbalances. This could be done, for example, by comparing the number of new jobs in occupations usually requiring university education to the new university-educated labour force. However, as the chart illustrates, the fit between educational attainment and the skill level required for an occupation is far from perfect. For information on the reasons why there is not a perfect correspondence between the educational attainment of a worker and the skill level of its occupation, click here.

Within low-skilled occupations, the proportion of workers with postsecondary education is important. Conversely, within high-skilled occupations, and most particularly, in management and in occupations usually requiring college education or apprenticeship training, there are also significant proportions of workers with lower educational attainment. In 2005, for example, 65% of those in occupations usually requiring university education actually had university education, 25% had college education and the remaining 10% only had high school or less.

This demonstrates that it is important to avoid confusing educational attainment with skill levels and to convert labour force by educational level to labour force by skill level. One way to make this conversion is to review the past labour market experience of individuals with given levels of education. What can be observed is that the probability that an individual with a given level of education will fill an occupation requiring a given level of skills has remained fairly constant for most categories over the 1990-2005 period. This is somewhat surprising, given both the pronounced business cycles and major structural changes in the economy and in the labour force that occurred during this period.

By forecasting these probabilities into the future and applying the results to labour force projections by educational attainment, a forecast of the labour force by skill level can be derived. Looking ahead, as the population ages, upward occupational mobility, which includes movements to management ranks as workers gain labour force experience, and downward occupational mobility, where workers choose to enter lower-skilled occupations as they transition towards retirement, will become of increasing importance in determining future labour supply by broad skill level. For information on the methodology used to forecast these probabilities and to view results, click here.

Over the next 10 years, the labour force in occupations usually requiring university education is expected to be the fastest-growing component of labour supply, advancing at an average rate of 1.6% per year. In contrast, the labour force in occupations usually requiring less than high school is expected to be growing at the slowest rate, averaging 0.6% over the 2006-15 period. This is not surprising, given that the growth of the labour force is expected to be strongest among those with university education and weakest among those with less than high school education — the primary feeding groups of these occupational skill levels.

The management labour force is expected to record only average growth over the next 10 years (1.0%) despite the above-average growth of its largest component, the labour force with postsecondary education. This is the result of two factors: (1) slowing growth in the core age groups, which are the largest suppliers of workers for management occupations; and (2) the tendency of older workers, as they begin their transition towards retirement, to leave management positions and take lower-skilled occupations, such as those in sales and service that have flexible work arrangements (e.g. flexible hours, for example). In fact, this latter factor is expected to lead occupations usually requiring high school to register an average growth rate of 0.9% over the next 10 years, despite below-average growth in their main feeder group, the labour force with high school education.

Future Labour Market Imbalances by Broad Skill Level

Imbalances between the skill levels usually required by employers and the qualified labour available may emerge over the next decade

At the aggregate level, employment growth is expected to outpace labour force growth slightly over the next 10 years. The resulting decline in the unemployment rate from 6.8% in 2005 to 5.6% in 2015 is consistent with a well-balanced labour market, in which unemployment returns to its "structural" level. A long-term structural unemployment rate of between 5.5% and 6.0% is consistent with forecasts carried out by the Conference Board of Canada,¹⁷ largely reflecting the impact of population aging and increased educational attainment, as older and more educated workers tend to display lower-than-average unemployment rates.¹⁸

Future labour market imbalances by broad skill level can be assessed by projecting changes in employment and in the labour force in order to calculate relative unemployment rates. This method can be used given that these projections of employment and the labour force were made independently of each other, allowing for the possibility of imbalances among skill levels to arise.

In the following chart, average annual growth rates in the labour force and employment are plotted along a 45° line to provide an insight into the future balance between labour demand and supply among broad skill levels. Overall, the points fall close to the 45° line, which implies that the growth in the broad skills usually required by employers and in the qualified labour available should be roughly in balance over the next 10 years. By also looking at movements in relative unemployment rates, however, one can gain a better picture of potential future imbalances among broad skill levels.

Growth in employment is expected to slightly outpace growth in the labour force across all skill levels, resulting in unemployment rate declines (see table below). Although unemployment rates for all skill levels are expected to decline, movements in unemployment rates relative to the economy-wide average are expected to diverge somewhat over the 2006-15 period, indicating potential imbalances among some broad skill levels over the next 10 years.

Managers and occupations requiring college education or apprenticeship training are expected to experience relative unemployment rate declines as employment growth is expected to be significantly stronger than labour force growth. The aging of the population could put pressure on those two skill levels. In contrast, in occupations usually requiring at least high school education and those requiring on-the-job training, employment gains are expected to outpace labour force gains at a lower-than-average rate, resulting in a lower decline in their unemployment rates. In occupations requiring at least a university education, the unemployment rate is expected to decline in line with the economy-wide average.

Relative Unemployment Rates by Skill Level, 2006-2015

	Unemployment rate in 2005		Growth 2006-15 (AAGR1)		Unemployment rate in 2015
	Level	Relative	Employment	Labour Force	Level	Relative
Total	6.8%	1.0	1.1%	1.0%	5.6%	1.0
Skill level
Management	3.3%	0.5	1.2%	1.0%	1.6%	0.3
Occupations usually requiring:
- university education	3.3%	0.5	1.6%	1.6%	2.9%	0.5
- college education or apprenticeship training	5.6%	0.8	1.1%	0.9%	3.2%	0.6
- high school education	8.2%	1.2	0.9%	0.9%	8.0%	1.5
- only on-the-job training	13.3%	2.0	0.7%	0.6%	12.3%	2.1
Source: Statistics Canada, Labour Force Survey & HRSDC, SPRD, Labour Market and Skills Forecasting and Analysis Unit, 2006 Reference Scenario. 1 AAGR : average annual growth rate

Future Labour Market Imbalances by Occupation

It was shown previously that labour market imbalances among some of the broad skill levels are foreseen over the next 10 years, given expected trends in employment and the labour force. Managers and occupations usually requiring college education or apprenticeship training could be facing some labour market pressures. However, this does not preclude the possibility of considerable labour market imbalances when looking at detailed occupations within each of the five skill levels, with excess supply in some occupations coexisting with excess demand in others.

This section highlights the occupations that are expected to be in labour shortage or surplus over the next 10 years. This is accomplished by comparing projections of the number of new job seekers emerging from the school system and from immigration to the number of job openings resulting from expansion demand and from retirements.¹⁹ Upward labour market pressures will occur if the number of job openings is expected to exceed the number of new job seekers. Alternatively, if the number of new job seekers is expected to be higher than the number of job openings, there will be downward labour market pressures.

In addition, one must also take into consideration the current balance between labour supply and demand within an occupation (see Current imbalances by occupation). For example, an occupation currently in excess demand will see its situation worsen if the number of job openings is projected to be greater than the number of new job seekers over the next 10 years. If this occupation is currently in excess supply, larger increases in the number of job openings than in the number of new job seekers over the projection period will contribute to reduce or eliminate the initial excess supply situation. To see a diagram of the methodology for assessing potential pressures by occupation, click here

Other considerations such as labour mobility are also taken into account when identifying the occupations that are expected to be in labour shortage or surplus over the next 10 years. Labour mobility takes two forms: vertical labour mobility, in which experienced workers move to the management ranks, and horizontal labour mobility, in which workers move between occupations that require similar skill sets. By not taking labour mobility into account, an approach that looks only at new job seekers when assessing future labour market pressures tends to overestimate situations of excess demand and supply among occupations. For example, new job seekers are mainly comprised of young individuals emerging from the school system without extensive labour market experience. Accordingly, very few of these young individuals will enter management or supervisory occupations after leaving school. On the other hand, workers already in the labour market (and who are not included in new job seekers) can move into management or supervisory occupations. Their supply is considered when assessing the labour market situation of these occupations.

Before highlighting the occupations that are expected to be in labour shortage or surplus over the next 10 years, projections of the components of job openings and new job seekers will be presented. Results supplied are mainly restricted to broad occupational groupings. For projections by detailed occupation, the reader can refer to the annexes.

Future job openings and new job seekers

Retirements will account for a growing share of job openings

Two main sources of job openings are assessed for all three-digit NOC occupations. Employment growth due to expansion demand is simply the result of new jobs being created through increased economic activity, as discussed in the section on "Employment Growth by Occupation." The second source of job openings comes from workers leaving their jobs because of retirements.

Over the past 10 years, expansion demand has accounted for about half of all job openings. Over the next 10 years, however, this pattern will change significantly. Expansion demand is expected to grow at an annual average rate of 1.1% over the period, creating 1.7 million non-student jobs. On the other hand, approximately 3.8 million people are expected to retire — an average of 2.4% of the workforce each year. In other words, over twice as many jobs will open up due to the retirement of workers in existing jobs as from the creation of new jobs.

Accordingly, retirements as a share of job openings will rise steadily over the forecast period, reaching almost 80% by 2015. This development will be driven by the aging of the population and the overall slowdown in employment growth.

For information on retirement projections (methodology and detailed results), click here

Two thirds of all jobs openings, from both expansion demand and retirements, will be in occupations usually requiring postsecondary education or in management

Future occupational demand (excluding students²⁰ will vary across skill levels. In fact, demand will be strongest in terms of both expansion demand and retirements in occupations usually requiring postsecondary education (university and college) and in management. Over the next 10 years, approximately 66% of the demand will be in these occupations, which represented 60% of employment in 2005.²¹

Among occupations usually requiring postsecondary education, demand will be particularly strong in occupations usually requiring a university degree, as employment is expected to grow by an average of 1.6% annually, while an average of 2.5% of the workforce will have to be replaced each year due to retirements. Although occupational demand will be slightly less in the other occupations requiring postsecondary education, it will nonetheless be greater than or equal to the economy-wide average. Occupations in management and in those usually requiring a college education or apprenticeship training are expected to register an average annual expansion demand rate of 1.2% and 1.1% respectively and a retirement rate of 2.8% and 2.4% respectively.

New job creation and retirements will be weakest in low-skilled occupations. Those requiring only on-the-job training will have the lowest demand (average annual expansion demand of 0.6% and a retirement rate of 2.1%). For occupations requiring only a high school diploma, employment growth will be about average and retirements will be below average (average annual expansion demand of 0.9% and a retirement rate of 2.2%).

Job Openings by Skill Level, 2006-2015

	Expansion demand (non-student)		Retirements		Share
	Level (000s)	Rate (AAGR1)	Level (000s )	Rate (AAR2)
Total	1,697	1.1%	3,801	2.4%	100.0%
Skill level3
Management	170	1.2%	433	2.8%	11.0%
Occupations usually requiring:
- university education	445	1.6%	726	2.5%	21.3%
- college education or apprenticeship training	560	1.1%	1,288	2.4%	33.6%
- high school diploma	425	0.9%	1,035	2.2%	26.5%
- only on-the-job training	97	0.6%	320	2.1%	7.6%
Source: HRSDC, Strategic Policy Research Directorate, 2006 Reference Scenario. 1AAGR: average annual growth rate. 2AAR: annual average retirement rates, which correspond to the ratio of retirement level to employment level for each forecast year. 3Skill levels are based on the 2001 NOC Matrix, in which occupations are grouped according to the education and training normally required.

In terms of levels, occupations usually requiring college education or apprenticeship training will account for one third of job openings (approximately 1.8 million). These occupations also represented one third (33%) of jobs in 2005. Although occupations requiring only high school education will account for a significant share of job openings (26.5%), this share will be lower than their proportion of total employment in 2005 (30%). In contrast, occupations requiring a university education, which accounted for 17% of employment in 2005, will represent 21.3% of job openings over the next 10 years. Similarly, management occupations will account for a more significant share of job openings (11%) than their share of total employment in 2005 (9.5%).

School leavers will remain by far the main source of new job seekers

The number of potential new job seekers is estimated from the flows of students emerging from the formal education system every year (school leavers) and of recent immigrants. New job seekers are assessed for all three-digit NOC occupations.

Over the next 10 years, approximately six million people will enter the Canadian labour market, with four fifths of them emerging from the education system. In 2005, an estimated 536,000 graduates and dropouts left Canadian educational institutions and entered the labour market. The number of school leavers in 2015 is expected to be 572,000. Annual growth (0.7%) should outpace demographic growth in the 17-to-29 age group, which is estimated to be 0.2% a year over the next decade. For information on school-leaver projections (methodology and results), click here

Although immigrants are a significant source of labour supply, they represent only one fifth of new job seekers. It is estimated that 121,000 immigrants admitted to Canada in 2005 looked for work. This number is expected to increase annually by 0.8% and to reach 131,000 in 2015. For information on immigration projections (methodology and results), click here.

Assessment of future labour market imbalances by occupation

Given current trends in supply and demand, occupations in the health sector and in management are expected to remain in shortage

Given these projections of future job openings and new job seekers, as well as the assessment of current labour market situations, numerous occupations are expected to continue to face imbalances between demand and supply over the medium term.

Most of the management occupations currently facing pressures are expected to continue to do so over the next 10 years, as the projected number of new job openings is expected to be greater than the projected number of new job seekers. The growing need to replace retiring workers will open up positions in many occupations, including legislators and senior management, human resources managers, as well as supervisors in trades, facility operation, oil and gas drilling and service, and processing. Shortage pressures are also expected to emerge in two other managerial occupations: managers in health, education, social and community services, and managers in public administration.

Increased health care needs resulting from the aging of the population will result in demand outpacing supply for several health care occupations. Occupations such as physicians, optometrists, health diagnosing and treating professionals, head nurses and supervisors, nurse aides and orderlies are expected to continue to face shortage pressures over the next decade. At the same time, other occupations in the health field — therapy and assessment professionals and medical radiation technologists — are likely to continue to display signs of pressure even though projections point to a relative balance between new job openings and new job seekers. This result stems from the fact that future supply would have to outpace future demand in order to alleviate the current pressures.

Table

Category	Occupations expected to face excess demand pressures over the next 10 years
Business, finance and administration occupations	Legislators and senior management (NOC 001)
	Human resources managers (NOC 0112)
	Human resources and business service professionals (NOC 112)
Natural and applied sciences and related occupations	Civil engineers (NOC 2131)
	Industrial engineering and manufacturing technologists and technicians (NOC 2233)
Health occupations	Managers in health, education, social and community services (NOC 031) Physicians, dentists and veterinarians (NOC 311)
	Physicians, dentists and veterinarians (NOC 311)
	Optometrists, chiropractors and other health diagnosing and treating professionals (NOC 312)
	Therapy and assessment professionals (NOC 314)
	Head nurses and supervisors (NOC 3151)
	Other technical occupations in health care (except dental) (NOC 323), such as registered nursing assistants, audiology technicians and physiotherapy technicians
	Medical radiation technologists (NOC 3215)
	Nurse aides and orderlies (NOC 3413)
	Other aides and assistants in support of health services (NOC 3414)
Occupations in social science, education, government service and religion	Managers in public administration (NOC 041)
Trades, transport and equipment operators and related occupations
	Residential home builders and renovators (NOC 0712)
	Facility operation and maintenance managers (NOC 0720)
	Contractors and supervisors, trades and related workers (NOC 721), such as in pipefitting trades and carpentry trades
Occupations specific to the primary industry
	Supervisors, oil and gas drilling and service (NOC 8222)
	Oil and gas well drillers, servicers, testers and related workers (NOC 8232)
Occupations specific to processing, manufacturing and utilities
	Supervisors, processing occupations (NOC 921), such as in petroleum, gas and chemical processing and utilities, and plastic and rubber products manufacturing

Shortage pressures among human resources and business service professionals are expected to remain as employers continue to place greater emphasis on recruiting and retaining quality employees to handle the increasingly complex jobs of our economy.

Pressures are also expected to persist over the next decade among oil and gas well drillers, servicers, testers and related workers as a result of an increase in demand associated with large capital spending projects, such as the tar sands development projects in Alberta. Finally, strength in non-residential construction (e.g. for the 2010 Olympics in British Columbia) and in renovation will benefit civil engineers and residential home builders and renovators.

However, some occupations currently facing shortage pressures should move in the coming years towards a better balance between labour demand and supply. These include occupations in the residential construction and real estate sectors, as a result of an anticipated slowdown in residential investment after the recent boom. Pressures among university professors are also expected to lessen, as more people complete their doctoral studies, though some shortage may subsist in specific disciplines. The same can be said for geologists, geochemists and geophysicists, mainly thanks to the high number of people enrolled in fields of study related to physical science. Computer and software engineers should also have enough labour supply to satisfy the demand for labour.

All the occupations currently in excess supply are expected to remain in this situation over the next 10 years. These occupations are mainly in low-skilled categories.

For information on the assessment of future labour market imbalances by occupation (methodology and detailed results), click here

The assessment of future labour market situations assumes that current trends in labour demand and supply will persist. Imbalances in occupational sectors of the labour market may actually diminish and disappear over the long term as firms and individuals respond to market signals (e.g. higher earnings in occupations facing excess demand) or to information about prospective imbalances. For example, young people may decide to enrol in fields of study that lead to occupations that are in excess demand or job holders may decide to move into occupations where demand is stronger. Firms may decide to use more machinery and equipment and less labour if the relative price of labour increases. Over time, such supply and demand adjustments will contribute to lessening labour market pressures in occupations currently in an excess-demand situation.

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¹³This is referred to as "required employment" — that is, the number of people needed to reach a certain level of production, given a specific level of productivity. It is not the number of people who will in fact be hired, which will be affected, among other things, by the number of people available for specific jobs. In other words, if there are shortages, the number of people working is constrained by supply.

¹⁴The occupational analysis reported in this section pertains to non-student employment only (90.1% of employment in 2005) because our focus is on the permanent labour market and excludes young people who are employed while studying and who tend to be concentrated in the sales and service sector.

¹⁵This methodology is adapted from the one used by the U.S. Bureau of Labor Statistics (BLS). For more information, see U.S. Bureau of Labor Statistics, Occupational Projections and Training Data, 2004-05 Edition, chapter 1. Washington, D.C.

¹⁶Projections of the labour force by educational level are obtained by: (1) projecting the population by educational level, which takes into account the continuing rise in educational attainment (through a cohort approach) and assumes that the youth of the future will be as educated as the youth of today; and (2) applying age-specific labour market participation rate assumptions by educational level.

¹⁷Conference Board of Canada, Canadian Outlook 2006: Long-term Economic Forecast, Ottawa, 2006.

¹⁸In fact, in May 2006 the unemployment rate reached 6.1%, indicating that it is already not far off the estimates of its long-term structural rate.

¹⁹This approach was adopted as it allows for deriving a potential labour supply independent of labour demand, thereby allowing for an evaluation of the degree of imbalances among detailed occupations. The potential labour supply is obtained by mapping out in which occupations school leavers (by field of study) and immigrants will offer their services. For school leavers, an "ex ante" approach is used, i.e. school leavers are assumed to offer their services in occupations related to their field of study, although in reality they might work in other unrelated occupations (for example, due to cyclical downturns).

²⁰As in the sections on employment growth by occupation, the occupational analysis presented here pertains to non-student employment only.

²¹In fact, 69.2% of jobs created by economic expansion will be in occupations generally requiring postsecondary education or in management, whereas 64.4% of job openings due to retirements will be in these occupational groups, for a combined average of 65.9%.

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Date Modified:

2007-05-28