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Calgary Job Market Outlook: The New Normal

Morley Surcon By Morley Surcon,
Vice-President, Western Canada at Eagle

Calgary Job Market Outlook: The New Normal The New Normal” is a phrase that has been used to describe the aftermath of a paradigm-changing event.  As recently as 2014, Calgary’s economy/job market/opportunity outlook was very robust, then the floor fell out of the oil market.  Since then, over 40,000 knowledge worker jobs were lost and the city is sitting at 8.6% unemployment, 1.7% higher than the Canadian average of 6.9%.  Economists are predicting a continued contraction, but at a slowing rate, as Calgary find its new equilibrium.

Over the next 12 months, economic conditions will continue to improve, but few believe that the economic spin-off from the Oil industry can or will reach the pre-oil-crash highs.  Some companies are gone completely — whole industries have been shipped off to be served by the global labour force.  These are unlikely to come back.  Hence, talk of “the new normal”.

As the Calgary economy does begin turning around, it is anticipated that independent contractors (contingent labour) will be leveraged prior to direct, permanent job openings seeing a recovery.  New expectations with respect to lower contract rates and salaries will need to be adopted by the labour market, which is happening already. The premiums that Calgary workers have enjoyed for close to a decade will be brought in line, nearer to those of the rest of Canada. Companies will do their best to stick to the cost-cutting plans that they’ve put in place, resulting in limited opportunity to raise rates and build larger teams; and we may see stronger interest in “generalists” vs. “specialists” as the need to wear multiple hats will likely exist.

In the vacuum created by Calgary’s imploded Oil and Gas industry, we are seeing this city’s entrepreneurial spirit sparking to life.  Calgary has one of the youngest and best educated labour markets in North America.  Prairie values of strong work ethic and the ability to tighten belts are resulting in people making the needed adaptations to take transferable skills to other new and existing industries.  Organizations such as Calgary Economic Development are actively pursuing companies/industries remote to the city, encouraging them to re-locate or open new offices to take advantage of the surplus of knowledge workers, including many IT professionals, now available.  Some nay-sayers are beginning to draw parallels between Calgary and Detroit; however, the skills, education and entrepreneurial spirit truly set Calgarians apart.  A good article discussing Calgary’s favourable outlook can be found in this Globe and Mail article.

So, what is the “new normal” for the labour market in Calgary?  Well for the short to medium term, it is certainly going to mean continued pressure on independent contractor rates and employee salaries; and many Oil and Gas positions have left, never to return again.  However, in the medium-long term, Calgary’s prospects are still very bright — there will be a period of transition, re-building and re-tooling but the raw energy, enthusiasm and talent that exists in Calgary’s working population will help the City to re-invent itself.  The hurdles will be great, but our collective determination will be greater.  Calgary’s potential remains unmatched and it will, again, be the pearl of Canada’s labour market; Calgary’s economy will re-emerge, more diversified and, in this way, stronger than before.

My city’s new normal is coming and I, for one, am looking forward to our bright future!

3 thoughts on “Calgary Job Market Outlook: The New Normal

  1. Great article Morley! “The new normal” is a right term to define the employment situation in Calgary. Despite all the efforts made by the government and the community, the unemployment figures are rising at alarming rate.
    I, a recent graduate from UofC and an active job-seeker meet with a lot of people and have found mixed views especially for the new graduates and would like to chip in my 2 cents in the discussion.
    At one hand the new grads offer an affordable and trained workforce for companies. Employers can attract these great minds to work for them and retain them by challenging and interesting work. On the other hand, the “surplus knowledge workforce” are also looking for employment with almost no expectations. However, employers need to understand that this workforce which may stick with them for this short period of time cannot be relied upon. As the industry picks up the pace, they will be the first to leave the smaller ships.
    The discussion boils down to the short-term and long-term vision of employers. Are they looking for a great short-term outlook for the firm or a slow yet perfect future of the firm.

    1. Deepak, Thanks for your comment!
      I recently participated in a “round table” discussion that had as its topic, the Calgary economy. Several participants stated that their biggest concern was for the new grads coming out of our local Universities, Colleges and Tech Schools. They are worried that Calgary could lose an entire generation of “bright minds” to other provinces. This will bite us later as people, more senior in their career, wish to retire and there will be a need to back-fill with experienced workers. The round table participants felt that the worker-gap created now will become an experience gap in the future.

  2. I have been following all the news regarding job market in Calgary and this article describes pretty well the current situation. Really hope to read more about the general trend of the market.
    I would also like to point out one more category of workers that haven`t been discussed: foreign trained professionals (the category i`ll be in). Although i just got my permanent resident status and i`ll be arriving in Canada next year, i followed the news and i`m trying to decide where to settle.
    I believe that the experience gained in other countries combined with the experience that will be gained in Canada leads to overall progress (in every aspect). However the prospects for hiring in Calgary (where i wanted to settle in the first place ) seem low and even if i work in an all-around good market (structural engineer), i am tempted to choose another province just because i might find a job easier.
    On the idea that “worker-gap created now will become an experience gap in the future“, and that retirement will cause the need for new professionals, it seems odd that companies still require “canadian experience “. If you worked somewhere for years before coming to Canada, then you can probably fit in.
    These were just a few thoughts i thought about after reading the article.

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