What causes unemployment in Canada?

Unemployment generally arises from macroeconomic and microeconomic factors. At the national and global levels, shifts in economic conditions, trade dynamics, and industry trends can significantly influence job markets. Regionally, local economic conditions, demographic changes, and mismatches between labour supply and demand can affect unemployment rates.

According to Statistics Canada, individuals aged 15 to 24 typically experience higher unemployment rates. In 2024, employment rates for this age bracket were lower than in the previous year. While the rate increased in April compared to March, it was still 3.7 percentage points lower than in April 2023. This disparity often reflects challenges like fewer opportunities for entry-level roles, limited access to training, and unmatched skill sets. Addressing these issues frequently requires collaboration between governments, educational institutions, and employers to create opportunities and align workforce skills with market needs.

How employers can attract top talent

When individuals face involuntary unemployment, they’re often willing to accept most opportunities within their field. Much of this unemployment stems from how many people enter the job market simultaneously, leading to more candidates than available positions. In many industries, the competition is intense. Employers can attract top emerging talent in the following ways:

Focusing on skills-based hiring

Relying on skills over traditional qualifications can give you more access to talent. Instead of focusing solely on degrees or years of experience, look for candidates with proven abilities and a strong portfolio. This approach allows you to tap into hidden talent, including those who may have transferable skills or non-traditional backgrounds. By prioritizing what candidates can actually do, you can attract creative problem-solvers who can bring fresh perspectives to your team.

Offering competitive benefits and perks

Work-life balance and flexibility remain top priorities for many employees. Hybrid work options, professional development allowances, and a strong benefits package can help attract motivated workers. Beyond standard perks, consider offering wellness programs, mental health support, and additional paid time off for personal development or volunteering. These perks can help you create a healthier work environment and show potential employees that you care about their well-being.

Highlighting purpose-driven work

Many individuals between 15 and 24 choose organizations that demonstrate a clear purpose, whether through the nature of their work or the causes they support. You can appeal to this desire by incorporating social responsibility into your brand. Support charitable initiatives, such as a pet supply company donating a portion of profits to animal shelters or partner with non-profit organizations, like a luxury home builder contributing to affordable housing projects. Candidates who align with your company’s values are more likely to stay engaged and motivated, knowing their work is making a difference.

Creating an inclusive workplace

Create a welcoming environment where employees from diverse backgrounds feel their value. Celebrate inclusivity through internal policies and company culture to boost team relationships and performance. Consider offering office perks, such as allowing pets, supplying complimentary coffee, tea, and snacks, or hosting social events and team-building activities. These small, thoughtful gestures can make employees feel more connected and appreciated, helping you foster a workplace where everyone feels at home.

Highlighting ways to grow

Career progression and training programs can appeal to individuals looking for professional development. Showcase opportunities for growth during recruitment by explaining how employees can expand their skills, take on new challenges, and move up within your company. You could also offer mentorship, regular performance reviews, and access to learning resources or certifications. By positioning your company as one where employees can grow personally and professionally, you demonstrate that you’re invested in their future, which can be a strong pull for top talent looking for long-term opportunities.

How talent can benefit your company

Investing in new talent can give you measurable advantages, such as:

• Adaptability and innovation: New hires often have fresh ideas and a willingness to learn, boosting your team’s creativity and problem-solving.
• Technological proficiency: Many are skilled in new technologies, giving your company an advantage over competitors.
• Diverse perspectives: New employees often offer different viewpoints, helping improve processes and strategies.
• Increased productivity: Motivation can be contagious, leading to better performance and results.
• Stronger talent pipeline: By hiring and developing talent early, you create a pool of skilled employees ready for leadership roles in the future.
• Enhanced customer satisfaction: Employees with current knowledge and skills are frequently better at meeting customer needs, improving relationships, and adding value.
• Fostering collaboration: New hires can help unite teams and encourage better communication.
• Brand advocacy: Talented employees are more likely to speak highly of your company, improving your reputation and attracting other top candidates.

How to retain employees

The following insights can help you turn retention challenges into opportunities:

Build strong onboarding programs

A great onboarding experience helps new employees feel welcome and ready to succeed. Be transparent about their role and what you expect of them. Introduce them to their team and connect them with a mentor or buddy. Make sure they have access to everything they need—tools, training, and resources—right away. When people feel supported from the start, they’re more likely to stay.

Invest in development opportunities

Help employees grow by offering ways to build their skills and competencies. This strategy could include mentorship, workshops, or letting them work on projects outside their usual tasks. Show them a clear path to advance in your company. From paying for certifications to giving access to courses, these opportunities can make employees feel valued and more likely to stick around.

Provide regular feedback and recognition

Let employees know when they’re doing a great job and give feedback to help them improve. A simple “thank you” or shout-out for their work can go a long way in keeping them motivated. You can also offer helpful advice so they can keep growing.

Empower employees through ownership

Give employees the freedom to take charge of their work and make decisions. Trusting them with responsibility can make them feel more connected to your company’s goals. People who think they have control over their work and can make a difference are generally more engaged. Empowered employees are typically more confident, motivated, and ready to contribute.

Offer competitive compensation and benefits

Pay employees fairly and provide great benefits to show you value their work. Go beyond just salary by offering perks like flexible hours, wellness programs, and extra time off to show your support and appreciation.

Support work-life balance

Offer flexible hours, remote work options, or generous paid time off to help employees balance their work and personal lives. Encourage them to take breaks and avoid burnout. Employees who feel they can manage work and life are typically happier and stay more committed.

Encourage team building and social connection

Plan team events, lunches, or virtual hangouts to help employees build strong relationships with each other. Work often becomes more enjoyable when teams enjoy spending time with their colleagues.

Listen to employee feedback

Ask employees for their thoughts through surveys, one-on-one meetings, or suggestion boxes. Show you care by acting on their ideas. Employees who feel heard typically have higher job satisfaction rates.

Address workplace issues quickly

Take care of problems or conflicts right away to keep your work environment positive and fair. Employees who see management handle issues fairly are likelier to trust and stay loyal to your company.

Celebrate diversity and inclusion

Make everyone feel welcome and valued, no matter their background. Focus on diversity in hiring, create inclusive policies, and teach your teams about the benefits of different perspectives. A diverse and inclusive workplace attracts and keeps a wider talent pool.

Using skills-based hiring and fostering an inclusive, growth-oriented workplace can help employers reduce unemployment rates while improving your organization’s success. Businesses and communities can create a more equitable and productive workforce when they work together to reduce Canada’s unemployment rate.