High job vacancies and an aging population define B.C.'s labour force

More people in B.C. are retiring at the same time as educated workers are choosing to hold out for better job offers. This could mean trouble for B.C.'s outstandingly high job vacancy rate

B.C.'s job vacancy rate is higher than the national average | Photo: Halfpoint Images/Moment/Getty Images

B.C. has the highest job vacancy rate in Canada while also having lower-than-average long-term unemployment rates.

A recent Statistics Canada report found that long-term unemployment in Canada accounted for a fifth of total unemployment in April, up five per cent from pre-pandemic levels. Over one in four of those individuals, defined as being out of work for almost seven months, hold a bachelor’s degree or higher.

In April 2022, 1.8 per cent of B.C.’s labour force, aged 15 or older, had been unemployed for three months or more, according to StatsCan. This was lower than the country’s average of 2.2 per cent. 

Despite B.C.'s lower-than-average long-term unemployment, it has still followed the national trend of rising from pre-pandemic levels. In February 2020, only 1.6 per cent of B.C.’s labour force and 2 per cent of Canada’s labour force had been unemployed for three months or more.

Giovanni Gallipoli, assistant professor at UBC’s Vancouver School of Economics, said these long-term unemployment rates are higher post-pandemic because workers have become more comfortable rejecting job offers.

“One of the problems that you are facing after the pandemic... is that in order for somebody to accept a job, it must be better than whatever the alternative is,” Gallipoli said. “It seems to me that what we call the ‘outside option,’ the alternative to accepting the job, has suddenly gone up.”

Gallipoli said there could be a number of different reasons people in the labour force are choosing not to return to work, such as salaries not being high enough or people searching for more flexible working arrangements. 

According to Gallipoli, the pandemic changed both the demand and supply sides of the market.

“On the demand side, the employer side, it allowed employers to figure out that they can perhaps do certain things differently, with workers or without workers,” he said. “On the side of the workers, it’s somewhat proven to them that life can be different.”

B.C.’s aging workforce

While more of Canada’s labour force becomes picky with how they spend their working hours, the number of Canadians nearing retirement is at an all-time high. Another StatsCan report from 2021 stated that more than one in five people are close to retirement age.

This is especially relevant in B.C., where almost a quarter of B.C.’s population is aged 65 or older — an all-time high for provinces west of Quebec.

With its population aging at record-setting rates and so many Canadians nearing retirement age, B.C.’s outstandingly high job vacancy rate could get even higher.

In March 2022, B.C. had a job vacancy rate of 7.3 per cent. That’s about two per cent higher than the national average.

Gallipoli said it’s a difference in the distribution of jobs that is setting B.C. apart from other provinces. More forestry jobs, fewer manufacturing jobs, an aging population and only two large urban centres are all factors he said could be contributing to job vacancies.

The educated and unemployed

With StatsCan reporting that nearly a quarter of all unemployed Canadians in 2021 held a university degree, Gallipoli said the pandemic has shown educated workers that they have the “upper hand.” He said in the future, he can imagine a labour force controlled entirely by the employee.

“I would not be surprised to see in a few years, the balance of bargaining power shifted towards the employee,” Gallipoli said. “I don't know when, but I think we are in for some turbulence going [forward].”