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All Talent Development Centre posts for Canadian technology contractors relating to the Canadian job market.

How Canadian Developers Can Remain Competitive

Brendhan Malone By Brendhan Malone,
Vice-President, Central Canada at Eagle

How Canadian Developers Can Remain CompetitiveLooking for new development skills to remain competitive in your field?  Perhaps Rapid Application Development and Front-End Design are in your future.

An interesting question in mapping out your career and determining what skills are most important for you involves both an evaluation, through research and data analysis, of the current market as well as what is coming next.  None of us have a crystal ball, but there are certain trends and information out there that can give us a better understanding of what is coming.

As the majority of consumers shift to their mobile devices to browse and purchase, so will employers’ demands in the skills they seek. Mobile development is one of the fastest growing environments in IT.  Skills such as Android app development, HTML5, iOS, CSS, JavaScript, and Angular are in such an incredible demand that there is simply not enough people to do the work that is already funded.

Over the last decade we have seen an incredible amount of development work move overseas.  Heavy development lifts are being completed in countries where labour costs are a fraction of what it would cost to do it here. Employers in Canada are no longer looking for consultants to sit behind a desk and code, that work has predominantly left the country.

As the Agile Methodology grows in popularity and consumers move to the mobile space, having the technical skills combined with an understanding of marketing and brand objectives of the end client will make you in high demand. What employers want now are collaborative, creative developers with an acute understanding of marketing and sales objectives who can work in a team environment.

Do you have the skills required to stay competitive and relevant in Canada’s fast-paced development space? If not, it may be time to take an inventory of your skills — hard and soft — and refresh or upgrade those that are lacking.

Quarterly Job Market Update for Q3 2016

Kevin Dee By Kevin Dee,
Chairman of the Board at Eagle

This post was originally published on the Eagle Blog

General Observations:

The third quarter of 2016 continued the “new normal” for Canada’s economy, which was not a positive thing!  Until oil prices get up into the $70+ range, consistently, we are unlikely to see a recovery in the very important oil sector.  Interest rates remain low but need to edge up in anticipation of the next recession, but the mere suggestion of interest rate increases causes a weakening in the markets.  The US economy continues to improve, but we are not seeing the expected “pull through” that we have seen in the past.  The Canadian dollar hovers around the 75c US mark which makes it more expensive for imports and Canada imports more than it exports.

The unemployment rate at the end of the third quarter was 7% which was a 0.2% worse than the 6.8% of Q2, but slightly better than the Q1 rate of 7.1%.  During the previous 12 months Canada added 139,000 jobs which was 21,000 more than the 12 months up to last quarter.  In a sign of our changing times, the majority of these were part time jobs.

The stock market continues to be volatile, and is one of the sources of concern for the Bank of Canada.  For the purposes of this report I focus on the TSX and it has enjoyed a reasonable period of growth, currently at around 15,000 points as opposed to 14,100 points at the end of the 2nd quarter.

As already mentioned, the oil patch continues to take a pounding and we don’t anticipate much positive change before 2018.  With oil starting to settle at around $50 a barrel we are not likely to see the start of any major projects.  The reality is that many companies in the oil patch are considering even more cost saving initiatives including layoffs.  Many companies are looking at divesting Canadian assets and investing in other geographies with less opposition and more government support.  Many workers who migrated to the oil patch during the boom have left, which will make things even tougher when a recovery happens because it will be difficult to entice them back.

The Canadian dollar in comparison to the US dollar is a long way from the days when we flirted with, and passed parity.  At time of writing the dollar is hovering between 75c US and 76c US, which is just a couple of cents weaker than the end of Q2.  The good news is that this helps the oil patch because they sell in US dollars and most costs are in Canadian dollars.  It is also helpful to our manufacturing sector, but that sector has been severely depleted over the years and Canada is a net importer meaning that overall a weak Canadian dollar is not good for Canada.

The banking sector, while a big user of talent and one of the largest employers in Canada, is also very careful.  The banks continue to be very careful with their hiring and are being careful to control their staffing levels.  Toronto and Montreal continue to demand talent, just perhaps a little more restrained than in other times.

The telecommunications companies are other big employers in Canada and are also very cost conscious.  While they demand the best talent in order to compete, they too, are also careful about keeping employment costs under control.  Some of the drivers of demand here include the highly competitive nature of the business, investment in infrastructure, technological innovation and a need to plan for a retiring “Boomer” workforce.

The US economy continues to add jobs, but at a reduced rate of about 150,000 per month.  The demand for skills in the US will lure talent from Canada which is good for the individuals but not so good for Canada in the long term.  What has not happened, and is different from previous economic times, is that Canada’s economy has not improved along with our neighbours, which is one of the indicators of a “new normal”.

The construction industry seems to be forever busy, to which anyone trying to get work done will attest.  Despite the slowdown in the big jobs like the oil sands, there appears to be a constant demand caused by infrastructure upgrades in many of our cities and we have the promise of more such work funded by our growing national debt (was that my out loud voice?).

The Liberal government has been in place for about a year and are continuing to both spend and raise taxes.  One example is their forced carbon tax, which is really just a money grab (does anyone really think this money won’t go into regular government coffers?) and is going to cost Canada jobs and hurt Canada’s economy at a time when it can ill afford it.  There are some expected government projects and infrastructure spending initiatives that should benefit the private sector.  In addition, spending in some ministries will be reduced as others benefit from the new agenda.  Some opportunities will be seen in sectors such as health, environment and education.

The Canadian Staffing Index is an indicator of the strength of the largest provider of talent in any economy (the staffing industry) and an excellent barometer of the health of Canada’s economy. The latest score for the Index was 108 in September, which was up 2 basis points from the end of Q2.

Here at Eagle the big impact on our business continues to be the oil patch, but other clients are taking advantage of a tough economy to look at their cost base.  This has led to layoffs and slower hiring patterns.  Year-over-year the number of people applying for jobs has increased by about 11.75%.  Demand from our clients was down more than 8% year-over-year.  This suggests to us that the people affected by the layoffs are now active in their job searches.  We also believe that demand is very patchy, with no sectors booming in demand for professionals.

More Specifically:

Toronto is one of the largest cities in North America with a population exceeding 6 million and the GTA (Greater Toronto Area) is home to the most head offices (almost 700) and most head office staff (around 75,000) in Canada.  Consequently it is also the hottest job market in Canada and generates about 60% of Eagle’s business.  While it remains a busy market we have seen some impact from downsizing in large companies that has increased the availability of senior people in the market.  Having said all that, if I were looking for work this is where I would like to be.  The sectors that are always looking for people include the financial, insurance, government and telecommunications sectors in addition to the retail sector and the construction industry.  There is also a fair amount of demand in the engineering and manufacturing space.

Western Canada and more specifically Calgary as the “oil capital” of Canada, has taken the brunt of the hit from the drop in oil prices.  There have been multiple rounds of layoffs, and more are projected, with the possibility that it may be 2018 before we see a recovery.  When the big oil companies are hurting there is a trickle-down effect to all of the services companies that serve them and the local economy is affected in retail and housing specifically.  The NDP government has done nothing to help boost confidence in Alberta for investors.  It should not be forgotten that both Saskatchewan and British Columbia have an oil sector too, and while they have been equally hit, those provinces seem to be doing better because their economies are less dependent on one sector and certainly Saskatchewan is a better managed province.  We have seen reasonable, but not strong, demand for talent in Vancouver, Regina, Winnipeg and Edmonton but remain cautious about the longer term impact of the loss of oil revenues.  This could affect everyone as provincial tax coffers suffer and the ancillary businesses are hit.

Eagle’s Eastern Canada region covers Ottawa, Montreal & the “Maritimes”. There is a better mood in Ottawa and within the Federal Government (other than the morale issues caused by a non-functioning pay system) but that has not translated into a bunch of work, as we know the contracting process is long and arduous.   There is an expectation that the Liberal government will get some projects back on the books, and there is optimism that a new agenda will lead to more business in the National Capital Region specifically.  Montreal is relatively unchanged, not booming but a steady demand for resources, particularly in the financial and telecommunications sectors.  The Maritime Provinces have traditionally had higher rates of unemployment and this continues to be the case.

The Hot Client Demand

At Eagle our focus in on professional staffing and the people in demand from our clients have been fairly consistent for some time.  Program Managers, Project Managers and Business Analysts  always seem to be in demand. It might just be our focus, but Change Management and Organizational Excellence resources are in relatively high demand too. Big data, analytics, CRM, web (portal and self-serve) and mobile expertise (especially developers) are specializations that we are seeing more and more. On the Finance and Accounting side, we see a consistent need for Financial Analysts, Accountants with designations and public accounting experience plus Controllers as a fairly consistent talent request. Expertise in the Capital markets, both technical and functional, tends to be a constant ask in the GTA.  Technology experts with functional expertise in Health Care is another skill set that also sees plenty of demand.  This demand fluctuates based on geography and industry sectors, so we advise candidates to watch our website and apply for the roles for which they are best suited.

Summary:

Canada’s economy continues to languish, and since the last recession we have been caught in a continual low interest rate, stimulus focused cycle that has never quite taken off.  The more recent “oil recession” has hit Canada hard, given that we are a resource rich country and there is no near end in sight.  Statistics show there are jobs being added in Canada, but the numbers are not impressive particularly when you see how the US is doing and most of those jobs are part time.

Federal and provincial governments are talking about stimulus spending and infrastructure projects, so there is an expectation this will create some boost to the economy, although I have not seen it.  If interest rates remain low, as expected, and the dollar remains fairly low, then we might also see some further growth in Canada’s relatively small manufacturing base.

Given that investment portfolios have recovered from the 2008 recession, we are seeing a rise in the Boomer retiree population which will create demand for highly skilled resources.  With Canada’s overall unemployment rate at 7%, we can deduce that the unemployment rate for trades and skilled workers to be much lower, perhaps even approaching skill shortage levels.  Even in these uncertain times, we see shortages in many niche skill areas.

There are definitely still opportunities created because of those retiring Boomers and the need for companies to remain competitive.  We see opportunity in the construction industry, the financial sector, the telecommunications sector and the insurance sector.  We see the markets with the greatest demand as being Toronto, Vancouver and perhaps Montreal.  Ottawa is showing promise and could pick up if new projects are initiated by the federal government.  Government spending will also provide a temporary boost to employment as the stimulus money becomes available.

That was my look at the Canadian job market for the third quarter in 2016 and some of its influences.

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!

The Future of Work: Technology and Automation

David O'Brien By David O’Brien,
Vice President, East Region & Government Services at Eagle

The Future of Work: Technology and AutomationAs the summer of 2016 rolls in, it would certainly appear that a phenomena that has been 30 years in the making is beginning to come to light. Rapid changes in technology and the job market are affecting the ways we live and work. For one example of major change, have a look at our neighbours to the south where an idea has seemingly and inexplicably risen to a level not yet fathomed other than as a joke mere months ago; the rise of The Donald, as in Trump, looks as though it may be here to stay… a scary thought indeed.

As a Canadian observer on the sidelines, there are some issues we certainly need to be aware of as the Trump vs Clinton presidential contest takes over our airwaves and party talk in the months ahead. For instance, Mr. Trump has made huge grounds on the backs of being anti-trade, anti-NAFTA in particular, claiming that trade is the mechanism with which Americans have lost thousands of manufacturing jobs to China, Mexico etc. Ours here is not to debate free trade but let’s look a little closer at what was the real change, the role technology has played, and crystal ball the perhaps forthcoming for IT jobs.

We do know for sure that both Canada and the US have lost manufacturing jobs over the last decade or more, Canada in particular has suffered deeper declines. The US’s lost jobs, though, in terms of productivity or manufacturing output, has increased dramatically, and manufacturers make on average more than twice the “stuff” they did in 1977. Therefore, it is safe to say the disruptive force at play affecting manufacturing jobs dramatically has not been trade, trade agreements, immigration or globalization. The disruptive force is technology and automation. And, while manufacturing jobs have disappeared, the business services sector grew over the same time and is now three times the size of the manufacturing sector.

So now what? The future of work stands to be disrupted like nothing we have seen in history. The pace of change in the way we work and work itself will be exponential in the coming years.

Artificial Intelligence (AI) and robotics are changing the way we work and live. Google, Facebook, Amazon, and IBM are all working very hard at monetizing their AI portfolio. The likely early leader will be Google and its DeepMind AI, an example of AI capable of deep learning, yes learning. In addition, Amelia is an AI created by IPsoft that has learned how to do the job of call center employees and in 20 languages. And of course, we all are aware of the pending arrival of the self-driving car.

The game changer is that AI is becoming good for more than routine and non-cognitive tasks and beginning to take over the cognitive or learning tasks. The new frontier is any job that humans can do is no longer safe. The so called “Fourth Industrial Revolution” is soon upon us and will undoubtedly change us all. Jobs will disappear BUT new jobs and perhaps new definitions of work itself will emerge, that much we know… I think.

First Quarter 2016 Canadian Job Market Review

Kevin Dee By Kevin Dee,
CEO at Eagle

This post first appeared on Eagle’s CEO Blog on April 15, 2016

General Observations:

Canadian Job MarketThe first quarter of 2016 in Canada has been more of the same from last year.  The economic hit in the oil patch has meant more layoffs, high paying jobs being replaced by lower paying jobs and a hit to the general economy.  Changes in government have not had much impact on spending yet, although proposed “stimulus spending” is supposed to help (no commentary about our increased debt burden). We have also felt the lowered demand from foreign markets such as China as they have had their own economic issues to deal with.  It has not all been doom and gloom as a weak dollar has helped some sectors such as manufacturing, plus it is still business as usual for other sectors like the services sector, retail, banking, construction and telecommunications.

The unemployment rate at the end of the first quarter was unchanged from year end 2015, at 7.1%.  During the previous 12 months, Canada added 130,000 jobs which was 28,000 less than the 12 months up to last quarter.  When you consider the US is adding 200,000 jobs every month, we should expect to be adding 20,000 a month to keep pace.

TSXThe stock market continues to be volatile.  I focus on the TSX for this report and it hit a low of around 11,500 mid-January but has trended upwards since then, finishing the quarter at around 13,500.  This was 500 points higher than it finished last quarter.

The oil patch continues to take a pounding, with sentiment pessimistic about a near term recovery.  Many of our Calgary-based clients are now talking about 2018 as their expected recovery time, with the impact of layoffs still being felt.  We enjoyed the highs of $100+ per barrel, followed by lows below $30.  Currently we are seeing low $40 a barrel pricing with predictions suggesting high $40s by year end.  The impact on the Calgary economy has been significant and will get worse as severance packages dry up, and the same can be said for other areas with heavy dependence upon the oil industry.

Canadian dollar the LoonieTo be expected with our economy struggling, the Canadian dollar has also suffered.  Since the beginning of 2015 we have seen highs around 85c US, and lows at 69c US.  Currently the dollar sits at 78c US, which is not terrible but as always the currency is at the mercy of world events.  The good news is that this helps the oil patch because they sell in US dollars and most costs are in Canadian dollars.  It is also helpful to our manufacturing sector.  Exporters will enjoy favorable pricing too; however, exports have been adversely affected by the economic woes of our trading partners like China.

The banking sector continues to be a big user of talent and one of the largest employers in Canada.  The primary demand for talent is in Toronto and to a lesser degree Montreal.  While the competitive nature of the industry requires investment in innovation, technology and responsiveness to regulatory change there is also a need to control costs.  We have seen some fluctuation in demand as certain parts of the financial sector have been reducing staff while others have been hiring.  The banks have taken advantage of the economy to restructure and become more efficient, which is prudent business practice but again tough for the economy right now.

Mobile antena. Communication conceptThe telecommunications companies are big employers in Canada and are also very cost conscious.  While they demand the best talent in order to compete, they are also careful about keeping employment costs under control.  Some of the drivers of demand here include the highly competitive nature of the business, investment in infrastructure, technological innovation and a need to plan for a retiring “Boomer” workforce.  The recent purchase of Wind by Shaw might increase competition and potentially open up opportunities should all of the regulatory approvals go through.

The US economy has been adding more than 200,000 jobs a month and in 2015 added 2.65 million jobs.  This, in spite of the impact of a low oil price in their oil sector, has resulted in some skill shortages in certain areas.  This may result in more Canadian skilled workers being lost from the Canadian economy but is an opportunity for individuals needing to find jobs.

ConstructionThe construction industry in Canada appears to remain healthy and despite the slowdown in the big jobs like the oil sands, there appears to be a constant demand caused by infrastructure upgrades in many of our cities.  From cranes dotting the landscapes of our cities, through infrastructure work on our highways and home improvement projects everywhere the signs of an in-demand industry are plain to see.  We hear that companies have benefitted from labour that was “freed up” due to lay-offs in the oil patch.

The Liberal government has been in place for about six months now and are beginning to make their presence known.  We have seen tax increases and associated the benefit to the accounting firms as companies and high net worth individuals get more creative about reducing their tax burden.  There are some expected government projects and infrastructure spending initiatives that should benefit the private sector.  In addition, spending in some ministries will be reduced as others benefit from the new agenda.  Some opportunities will be seen in sectors such as health, environment and education.

The Canadian Staffing Index is an indicator of the strength of the largest provider of talent in any economy (the staffing industry) and an excellent barometer of the health of Canada’s economy. The latest score is for January and indicates a slight increase in demand for labour over December, and a similar increase over January in 2015.  This indicator is an aggregate of hours for all classes of labour and so it is my expectation that the impact has been greater on unskilled labour and that skilled talent has a much lower unemployment rate.

Eagle LogoHere at Eagle the big impact on our business has been the oil patch.    Year-over-year the number of people applying for jobs has increased by about 7% and there was a 32% increase in job applicants over last quarter.  Demand from our clients was down year-over-year, with 10% less orders in the first quarter of 2016.  That demand was, however, 18.5% higher than the last quarter.  This suggests to us that the people affected by the layoffs are now active in their job searches.  We also believe that demand is recovering, although that seems to be happening in sectors outside of the oil patch.

More Specifically:

cn towerToronto is the 5th largest city in North America with a population exceeding 6 million.  The GTA (Greater Toronto Area) is home to the most head offices (almost 700) in Canada and most head office staff (around 75,000).  Consequently it is also the hottest job market in Canada and generates about 60% of Eagle’s business.  While it remains a busy market we have seen some impact from downsizing in large companies that has increased the availability of senior people in the market.  Having said all that, if I were looking for work this is where I would like to be.  The sectors that are always looking for people include the financial, insurance, government and telecommunications sectors in addition to the retail sector and the construction industry.  There is also a fair amount of demand in the engineering and manufacturing space.

The Saddledome in CalgaryAs already mentioned several times, in Western Canada it is Alberta, and more specifically Calgary as the “oil capital” of Canada, that has taken the brunt of the hit from the drop in oil prices.  There have been numerous layoffs, and more are projected, with possibly another year before we see a recovery.  These layoffs affect not just the oil companies but also the industries that serve them and the local economy gets affected in retail and housing specifically.  The NDP government has done nothing to help boost confidence in Alberta for investors.  It should not be forgotten that both Saskatchewan and British Columbia have an oil sector too, and while they have been equally hit those provinces, seem to be doing better because their economies are less dependent on one sector.  We have seen reasonable, but not strong, demand for talent in Vancouver, Regina, Winnipeg and Edmonton but remain cautious about the longer term impact of the loss of oil revenues.  This could affect everyone as provincial tax coffers suffer and the ancillary businesses are hit.

Parliament building in OttawaEagle’s Eastern Canada region covers Ottawa, Montreal & the “Maritimes”. With the still relatively new Liberal government in place some projects that had been stalled have begun to move again, and there is optimism that a new agenda will lead to more business in the National Capital Region specifically.  Montreal is relatively unchanged, not booming but a steady demand for resources, particularly in the financial and telecommunications sectors.  The Maritime Provinces have traditionally had higher rates of unemployment and this is not changing much so work is tough to find.

The Hot Client Demand.

At Eagle our focus in on professional staffing and the people in demand from our clients have been fairly consistent for some time. That would include Program Managers, Project Managers and Business Analysts who always seem to be in demand. It might just be our focus, but Change Management and Organizational Excellence resources are in relatively high demand too. Big data, analytics, CRM, web (portal and self-serve) and mobile expertise (especially developers) are specializations that we are seeing more and more. On the Finance and Accounting side, we see a consistent need for financial analysts, accountants with designations and public accounting experience plus controllers as a fairly consistent talent request. Expertise in the Capital markets, both technical and functional, tends to be a constant ask in the GTA.  Technology experts with functional expertise in Health Care is another skill set that also sees plenty of demand.  This demand fluctuates based on geography and industry sectors, so we advise candidates to watch our website and apply for the roles for which they are best suited.

Summary:

There had been hope that 2016 would see the start of a turnaround in the oil patch, but that seems to be a moving target, with 2018 seeming like a more realistic time line.  The country is adding jobs, but the concern is that we have lost so many high paying jobs in the oil sector it is likely we are replacing them with lower skilled and lower salaried jobs.

Federal and provincial governments are talking about stimulus spending and infrastructure projects, so there is an expectation this will create some boost to the economy.  If interest rates remain low, as expected, and the dollar remains fairly low, then we might also see some further growth in Canada’s relatively small manufacturing base.

With Canada’s unemployment rate at 7.1%, we expect the unemployment rate for trades and skilled workers to be much lower.  Even in these uncertain times we see shortages in niche skill areas.

There are definitely still opportunities created because of the demographic pressures (retiring Boomers) and the need for companies to remain competitive.  We see opportunity in the construction industry, the financial sector, the telecommunications sector and the insurance sector.  We see the markets with the greatest demand as being Toronto, Vancouver and perhaps Montreal.  Ottawa is showing promise and could pick up if new projects are initiated by the new government.  Edmonton is anxious because a large part of its business is tied to the provincial government and tax revenues are down significantly due to the oil crisis.  The Conference Board, however, is suggesting that even Alberta will see GDP growth in 2016, with all provinces experiencing some modest growth.  Government spending will also provide a boost to employment as the stimulus money becomes available.

That was my look at the Canadian job market for the first quarter in 2016 and some of its influences.

Quarterly Job Market Update – January 2016

Kevin Dee By Kevin Dee,
CEO at Eagle

This post first appeared on Eagle’s CEO Blog on January 25th, 2016

Canadian Job Market

General Observations:
2015 was a tough year in Canada, with GDP contracting for each of the first two quarters, Canada suffered a “technical recession”, and many businesses felt it!  The primary reason for the malaise was the impact on the oil sector caused by a low price per barrel.  Other impacts through the year have been the economic meltdown in China, which is a large consumer of Canadian raw materials, and of late the low Canadian dollar although that does help our beleaguered oil sector.

The unemployment rate at year end was 7.1%, which was 0.4% worse than 12months ago.  Over the course of 2015 Canada added about 158,000 jobs with about 18,010,000 employed.

TSXThe stock market was extremely volatile in 2015 experiencing a steady decline since about April.  One indicator that I follow for this report is the TSX which was at a high of about 15,500 in April and ended the year at around 13,000 but has actually declined another 1,000 since then.

As already mentioned the price of a barrel of oil has been a big factor in our tough economy and it does not look like it is getting better in the short term.  From its highs of well over $100 a barrel we are currently seeing sub $30 prices.  The impact in the oil patch has been layoffs, and more are expected with rates at this level.

Canadian dollar the LoonieTo be expected with our economy struggling, the Canadian dollar has also been suffered.  The 2015 high saw the Canadian dollar fetch about 83c US, and by the end of the year we were around 70c US.  Since then we have dipped below 70c!  The good news is that this helps the oil patch because they sell in US dollars and most costs are in Canadian dollars.  It is also helpful to our manufacturing sector, however that sector has been severely depleted over the years when the dollar was stronger so I don’t expect that much impact for Canada.  Given that our exporters have also been hit by the slowdown in China another expected area of benefit is reduced.

The banking sector continues to be a big user of talent and one of the largest employers in Canada.  The primary demand for talent is in Toronto, but there is also demand in Montreal.  While the competitive nature of the industry requires investment in innovation, technology and responsiveness to regulatory change there is also a need to control costs.  We have seen some fluctuation in demand as certain parts of the financial sector have been reducing staff while others have been hiring.  The banks have taken advantage of the economy to restructure and become more efficient, which is prudent business practice but again tough for the economy right now.
cell towerThe telecommunications companies are big employers in Canada and are also very cost conscious.  While they demand the best talent in order to compete, they are also careful about keeping employment costs under control.  Some of the drivers of demand here include the highly competitive nature of the business, investment in infrastructure, technological innovation and a need to plan for a retiring “Boomer” workforce.  The recent purchase of Wind by Shaw might increase competition and potentially open up opportunities should all of the regulatory approvals go through.

The US economy has been adding more than 200,000 jobs a month and in 2015 added 2.65 million jobs.  This, in spite of the impact of a low oil price in their oil sector, has resulted in some skill shortages in certain areas.  This may result in more Canadian skilled workers being lost from the Canadian economy but is an opportunity for individuals needing to find jobs.

ConstructionThe construction industry in Canada appears to remain healthy and despite the slowdown in the big jobs like the oil sands, there appears to be a constant demand caused by infrastructure upgrades in many of our cities.  From cranes dotting the landscapes of our cities, through infrastructure work on our highways and home improvement projects everywhere the signs of an in-demand industry are plain to see.

The Federal election saw a change in government which will have an impact on Canada’s economy.  In the short term, tax increases and rhetoric from a left leaning government has caused some loss in confidence and willingness to invest.  In the longer term I expect that as the government begins to implement its agenda it will create opportunities in various sectors such as Health, environment and education.

The Canadian Staffing Index is an indicator of the strength of the largest provider of talent in any economy (the staffing industry) and an excellent barometer of the health of Canada’s economy. The latest score suggests a continued slowdown in demand for labor in 2015, ending the year down slightly over 2014.  This indicator is an aggregate of hours for all classes of labor and so it is my expectation that the impact has been greater on unskilled labor and that skilled talent has a much lower unemployment rate.

Eagle logoHere at Eagle the big impact on our business has been the impact on the oil patch.    Year over year the number of people applying for jobs has been relatively consistent, but there was a decline of 22.5% in demand from our clients in 2015, almost exclusively attributed to the Calgary market

More Specifically:

cn towerThe GTA (Greater Toronto Area) is the hottest job market in Canada and generates about 60% of Eagle’s business.  While it remains a busy market we have seen some impact from downsizing in large companies that has increased the availability of senior people in the market.  Having said all that, if I were looking for work this is where I would like to be.  The sectors that are always looking for people include the financial, insurance, government and telecommunications sectors in addition to the retail sector and the construction industry.  There is also a fair amount of demand in the engineering and manufacturing space.

oil rigsAs already mentioned several times, in Western Canada it is Alberta, and more specifically Calgary as the “oil capital” of Canada, that has taken the brunt of the hit from the drop in oil prices.  All of the major oil companies are headquartered in Calgary and cost cutting has resulted in many layoffs, with many more projected in the first half of 2016.  These layoffs affect not just the oil companies but also the industries that serve them such as technology, services, engineering and transportation companies.  The uncertainty facing the oil patch from the relatively new NDP government has reduced confidence and future investment is also at risk.  The “oil sector bust” will pass but it remains to be seen whether investment will remain in Alberta bringing back the jobs that have been lost to date.  Elsewhere the impact has not been as bad, with Vancouver, Regina and Edmonton still in need of talent but nervous about the longer term impact of the loss of oil revenues.  This could affect everyone as provincial tax coffers suffer and the ancillary businesses are hit.

Parliament building in OttawaEagle’s Eastern Canada region covers Ottawa, Montreal & the “Maritimes”. With a new federal government in place some projects that had been stalled have begun to move again, and there is optimism that a new agenda will lead to more business in the National Capital Region specifically.  Montreal is relatively unchanged, not booming but a steady demand for resources particularly in the financial and telecommunications sectors.  The Maritime Provinces have traditionally had higher rates of unemployment and this is not changing much so work is tough to find.

The Hot Client Demand.
At Eagle our focus in on professional staffing and the people in demand from our clients have been fairly consistent for some time. That would include Program Managers, Project Managers and Business Analysts who always seem to be in demand. It might just be our focus, but Change Management and Organizational Excellence resources are in relatively high demand too. Big data, analytics, CRM, web (portal and self-serve) and mobile expertise (especially developers) are specializations that we are seeing more and more. On the Finance and Accounting, side we see a consistent need for financial analysts, accountants with designations and public accounting experience plus controllers as a fairly consistent talent request. Expertise in the Capital markets, both technical and functional, tends to be a constant ask in the GTA.  Technology experts with functional expertise in Health Care is another skill set that also sees plenty of demand  This demand fluctuates based on geography and industry sectors, so we advise candidates to watch our website and apply for the roles for which they are best suited.

Summary:

Canada has been weathering somewhat of a storm, and if the oil industry picks up through 2016 then we should be in reasonable shape.  We are adding jobs, and the bigger impact of the downturn have been very regionalised, which has been bad news for Alberta but certainly some people are finding jobs in other geographies and sectors.  Relatively new governments in Alberta and at the Federal level could mean new policies that will create opportunities.  One question will be how much business confidence is affected by the new agendas of these governments.

While Alberta has suffered most, with recession-like symptoms, the rest of Canada endured a technical recession for the first half of the year but the second half saw some growth, and 2016 is expected to be better.  Canada’s unemployment rate is at 7.1% which is not great, but the unemployment rate for skilled workers will be far lower.  Even in these uncertain times we see shortages in niche skill areas.

There are definitely still opportunities created because of the demographic pressures (retiring Boomers) and the need for companies to remain competitive.  We see opportunity in the construction industry, the financial sector, the telecommunications sector and the Insurance sector.  We see the markets with the greatest demand as being Toronto, Vancouver and perhaps Montreal.  Ottawa is showing promise and could pick up if new projects are initiated by the new government.  Edmonton is anxious because a large part of its business is tied to the provincial government and tax revenues are down significantly due to the oil crisis.  The Conference Board however is suggesting that even Alberta will see GDP growth in 2016, with all provinces experiencing some modest growth.

The unemployment rate at 7.1% could be easily reduced with some positive news on the oil front and some positive moves by the governments (Federal and Provincial) in power.  If that happens we could quickly move back to a full employment situation and start to run up against the different issue of finding enough people!  Of course my crystal ball is about as good as anyone else’s, so we will wait and see how the economy unfolds over the balance of the year.

That was my look at the Canadian job market for 2015 and some of its influences, with a view to how it might affect employment in 2016.

Island in a Storm: Outlook for Edmonton in 2016

Cameron McCallum By Cameron McCallum,
Branch Manager at Eagle

Island in a Storm: Outlook for Edmonton in 2016I recently attended a presentation given by John Rose, Chief Economist for the City of Edmonton, where he offered an analysis of what the future — short and medium term — held for Alberta’s capital city. While the province’s struggles in the wake of an excruciatingly low-priced barrel of oil is well documented, he offered a cautious but mildly optimistic outlook for the city itself. The following are the salient points as I saw it:

  1. Rose predicted modest growth for Edmonton in 2016, likely somewhere around 1%, which is a slowdown from past years when growth hovered closer to 3% and higher.
  2. Construction, Public Administration, and growth in the Retail sector in Edmonton have offset losses connected to stagnation in the resource sector and he felt Edmonton will be much quicker than the rest of the province to return to more robust growth in late 2016 or early 2017.
  3. Growth in Edmonton will be dependent on government investment. Should resource revenues and oil prices continue to remain unusually low and government decides to drastically reign in spending as a result, all bets are off and further recessionary pressures would be forthcoming.
  4. Unemployment in the province will increase by as much as 3.5 to 4.0% in the North (Wood Buffalo) and South (Lethbridge/Medicine Hat) and Fort McMurray, Red Deer and Calgary are seeing a surge in job losses. Edmonton is likely to see this key indicator grow as well, but only by 1.0%.
  5. Low oil prices will continue into 2017 when a potential slowdown in US production helps firm up the cost of a barrel. However, Mr. Rose was quick to point out that he doesn’t see the price of oil returning to the $100 mark and that the new normal would be between $50 and $80.
  6. While a slowdown is not typically ideal for any economy, Mr. Rose did point out that continued low interest rates and modest inflation pressures would contain cost escalation for capital projects and gives the city a chance to address infrastructure and services deficits and that now is perhaps as good as any time for investment in our future.

While I’m unqualified to make these types of predictions, I can say that what I am seeing in the Edmonton market and from conversation with our clients, these observations are accurate for now. A downturn in some sectors has been offset by activity in others and Edmonton remains, at least for now, a viable and prosperous city with excellent opportunities for professional contractors.

Quarterly Job Market Update – July 2015

Kevin Dee By Kevin Dee,
CEO at Eagle

jobsGeneral Observations:

The first half of the year has been a challenge here in Canada, driven largely by the struggling oil sector, which tends to ripple through the economy.  The general feeling is that Statistics Canada will announce a recession, given that Canada will have experienced two consecutive quarters of contraction.

Target LogoFollowing a tough first quarter of low oil prices, mid-$40 range, and layoffs in the retail sector (Target, Sony, Mexxx) the second quarter has continued to see the effects of a depressed energy sector.

The employment rate at the end of Q2 is unchanged from the end of Q1, sitting at 6.8%.  There has been a loss of about 11,000 jobs in the oil sector however Canada has actually added 33,000 jobs in Q2, and 176,000 jobs over the last 12 months.

TSXAs another economic indicator the TSX has been fairly steady, despite other volatility in the markets.  At the end of Q2 the TSX was at about 14,500 which was down about 500 points from the 15,000 reading at the end of Q1.

As already mentioned the price of a barrel of oil has plummeted and is currently sitting around $55 a barrel, but at the end of Q1 was below $50.  This had a significant impact in the oil patch, resulting in cut backsOil can, reduction in spending and layoffs.  When coupled with a low Canadian dollar however it is not ALL bad news, and Canadian manufacturers and exporters are benefiting.

The financial sector is one of the largest employers in Canada and continues to be a busy user of talent.  This sector is centered primarily in Toronto, but with a significant presence in Montreal. There are many reasons why this sector remains busy including its highly competitive nature, evolving technologies, regulatory change and volatile markets.

Mobile antena. Communication conceptThe telecommunications sector is another big employer in Canada in a very competitive world.  Differentiation is achieved through infrastructure, technology advancements and new offerings.  In addition they are dealing with the effects of an aging workforce and the retiring baby boomers.

ConstructionThe construction industry is a large consumer of labor and remains a great place to find work, both in the trades and in the head offices of the large companies. You can see cranes dotting the landscape in most major cities with infrastructure projects, office towers and condo developments. The drop in oil prices has cost jobs in the oil sands and other large projects but in general, if people are willing to travel there is work to be had.  There continues to be high demand for “trades” in the home renovation and small scale construction world.

Despite the need for governments to contain costs we have seen a fairly steady demand in Federal, Provincial and Municipal Governments.  They are huge employers, and people with the right skills are always in demand. The required downsizing is generally achieved through attrition and there is always work to be done. Regulatory change, policy development and general administrative needs dictate the need for a large and skilled workforce that receives competitive incomes and very attractive pensions and benefits. As we get closer to Federal and Provincial elections the projects are slowing down and funding is harder to get.  I would expect to see a slowdown in this sector over the next six months At least.  It is difficult to say what will happen in Alberta with an NDP government that has no experience governing.  The general consensus seems to suggest a steep but fairly long learning curve that will cost jobs.

The Canadian Staffing Index is an indicator of the strength of the largest provider of talent in any economy (the staffing industry) and an excellent barometer of the health of Canada’s economy. The index suggests that the slowdown in the demand for talent we saw in Q1, continued into Q2.  Increased demand for staff augmentation resources is often the first sign of recovery, and we are not yet seeing that.

Here at Eagle we have seen significant impact on our Western Canada business however other markets remain fairly steady.  Following a first quarter drop of 30% in orders, we saw a further dip of almost 10% in Q2.  The impact has been almost exclusively in Alberta and Saskatchewan.  While other markets have been fairly stable there has been no offsetting increase in demand.

More Specifically:
cn towerWith more than 6 million people, and the largest number of head offices in Canada, the GTA (Greater Toronto Area) is by far Canada’s, and Eagle’s, largest market.  This market accounts for approximately 60% of Eagle’s business which comes from the major industries here, which include the financial, insurance, government and telecommunications sectors.  The retail sector and the construction industry also generate significant demand, in addition to the engineering space.  Despite a technical recession the GTA continues to demand talent.

The Saddledome in CalgaryIn Western Canada Alberta, and more specifically Calgary has taken the brunt of the hit from the drop in oil prices, and it has been a significant hit.  In addition to the hit in oil prices has been the uncertainty of an NDP government coming to power, who have already raised corporate taxes and have an environmental agenda that will impact big oil.  Companies are still evaluating whether their investment dollars should be redirected outside of Alberta!  It remains to be seen whether confidence can be restored to the business sector, and what affect that will have on jobs and the Canadian economy.

Parliament building in OttawaEagle’s Eastern Canada region covers Ottawa, Montreal & the “Maritimes”. Ottawa is essentially a “government market” and as such will rise and fall based on Federal projects and spending.  As an election nears we are seeing the typical slowdown in demand which will continue until well after the election.  Montreal is relatively steady but not booming, with demand coming from the financial sector, the telcos and the construction industry. There will be some impact from the oil price felt particularly in Newfoundland.  This region is typically slower for job creation at the best of times, so I expect it to be even slower than normal until we see an uptick in oil prices

At Eagle our focus in on professional staffing and the people in demand from our clients have been fairly consistent for some time. That would include Program Managers, Project Managers and Business Analysts who always seem to be in demand. It might just be our focus, but Change Management and Organizational Excellence resources are in relatively high demand too. Big data, analytics, CRM and mobile expertise are specializations that we are seeing more and more. On the Finance and Accounting, side we see a consistent need for financial analysts, accountants with designations and public accounting experience plus controllers as a fairly consistent talent request. Technology experts with functional expertise in Health Care is another skill set that sees plenty of demand

Summary:

The first half of 2015 has seen a wide difference in the economies of the East versus the West.  The West has suffered through the predictable fallout from a dropping price of a barrel of oil, the East has continued somewhat unabated.  The general consensus appears to be that oil prices will not recover to their recent highs, and will not increase significantly in the near term.  This outlook has companies taking a conservative approach to investment and growth plans.  The impact in Calgary has been most significant, and now we are seeing impact on other markets, including Edmonton and Saskatchewan, which was expected.

The other big verticals such as Financial, Insurance, Telecommunications and Construction have not been greatly affected by the price of oil. Demand for talent appears to be strong and we are seeing these sectors benefit from newly available talent, previously employed in the oil sector.

The recent lowering of the overnight interest rate was a sign that the Feds want to get the economy moving again.  With a Fall election coming they will hope things will improve, although the signs are that we are unlikely to see a much improved economy in the near term.

Despite the current crunch, we expect continued skills shortages in our knowledge economy, partly fueled by the boomers retiring, but also caused by our education system not turning out the right skill sets and the advancements in technology creating a shortage as the skills catch up.

The unemployment rate at 6.8% is not great but it is also not terrible.  Professionals are probably seeing an unemployment rate more like 4%, so companies are still having trouble finding the right talent, at the right time for the right price!

That was my quarterly look at the Canadian job market and some of its influences.

Contractor Quick Poll: Your 12 Month Outlook

What’s Your Outlook on Contract Opportunities in Your Field Over the Next 12 Months?

The last few years have seen some ups and downs in different economies across Canada. Depending on your region, your industry or even your specialization, some days are better than others for finding new contract opportunities. This month, we’re asking our readers how you feel about your potential contract opportunities over the next 12 months:

Surviving a Downturn (in Alberta?)

Kevin Dee By Kevin Dee,
CEO at Eagle

This article first appeared on the Eagle Blog on January 25, 2015.

Here in Canada, where the resource sector plays such a big role in our economy there isOil Patch some concern about what kind of economy we are going to see in 2015.  The price of oil is unlikely to recover quickly and the conference board is suggesting that Alberta will head into recession.

This will have people wringing their hands and concerned for their future.  The most pragmatic will already be making plans for the new realities and those who have not yet done that will either throw your hands in the air and hope for the best … or better yet will knuckle down and do what is needed!

The following is advice that I remember reading from Tom Peters at the start of the last recession … it was sobering, but reality.  It seemed like a good time to pull it out again.

I am constantly asked for “strategies/’secrets’ for surviving the recession.” I try to appear wise and informed—and parade original, sophisticated thoughts. But if you want to know what’s going through my head, read the list below:

  • You work longer. 
  • You work harder. 
  • You may well work for less; and, if so, you adapt to the untoward circumstances with a smile—even if it kills you inside. 
  • You volunteer to do more. 
  • You always bring a good attitude to work. 
  • You fake it if your good attitude flags. 
  • You literally practice your “game face” in the mirror in the morning, and in the loo mid-morning.
  • You shrug off shit that flows downhill in your direction—buy a shovel or a “pre-worn” raincoat on eBay. 
  • You get there earlier. 
  • You leave later. 
  • You forget about “the good old days”—nostalgia is for wimps. 
  • You buck yourself up with the thought that “this too shall pass”—but then remind yourself that it might not pass anytime soon, so you re-dedicate yourself to making the absolute best of what you have now. 
  • You eschew all forms of personal excess. 
  • You simplify.
  • You sweat the details as you never have before. 
  • You sweat the details as you never have before. 
  • You sweat the details as you never have before. 
  • You raise to the sky the standards of excellence by which you evaluate your own performance.
  • You thank others by the truckload if good things happen—and take the heat yourself if bad things happen.
  • You behave kindly, but you don’t sugarcoat or hide the truth—humans are startlingly resilient.
  • You treat small successes as if they were Superbowl victories—and celebrate and commend accordingly.
  • You shrug off the losses (ignoring what’s going on inside your tummy), and get back on the horse and try again.
  • You avoid negative people to the extent you can—pollution kills. 
  • You eventually read the gloom-sprayers the riot act. 
  • You learn new tricks of your trade.
  • You network like a demon.
  • You help others with their issues. 
  • You give new meaning to the word “thoughtful.” 
  • You redouble, re-triple your efforts to “walk in your customer’s shoes.” (Especially if the shoes smell.)
  • You mind your manners—and accept others’ lack of manners in the face of their strains.
  • You are kind to all mankind.
  • You leave the blame game at the office door. 
  • You become a paragon of accountability. 
  • And then you pray.

Thanks Tom!