Winds of change have been blowing in the Canadian economy since the beginning of the year as the country adapts and modifies COVID-related restrictions. Senior Economist Brendon Bernard from the Indeed Hiring Lab has been keeping a close eye on the Canadian labour market as it reacts to those changes and signs are encouraging. Here are main highlights of the market trends in Canada:

February and March more than make up for January’s decline

The Canadian labour market got off to a rough start to 2022, amid surging COVID-19 cases and new public health restrictions. However the dip was short lived: employment in February more than recouped previous losses, and strong gains continued in March. Construction as well as professional and technical services have led recent growth, with employment in the latter now up 14% since February 2020. The overall progress has sent the share of the adults with a job now to above its pre-pandemic level, which is particularly impressive given ongoing population ageing. 

Helping drive this job growth has been ongoing strength in employer demand. Canadian job postings on Indeed continued to rise through mid-March, standing 69% above their pre-pandemic level as of March 18, 2022. With the easing of restrictions across the country, hiring appetite is elevated across almost all sectors, with demand particularly high in fields like human resources and software development, while postings in food services have shown momentum recently, rebounding after a slow start to the year.

Attention turns to salaries  

At this point, the number of jobs is no longer the most pressing issue in the Canadian labour market. Rather, focus is shifting to how far paychecks are going in today’s high inflation environment. Average hourly wage growth ticked up from 3.1% to 3.4% year-over-year in March, but still trail the pace of price growth.

Low unemployment rates and higher number of job postings suggest conditions should facilitate faster wage growth, but Canadian paychecks aren’t rising as fast as prices in the global economy. How employers respond and job seekers respond to these developments will be key trends to watch in the months ahead.