Calgary & Area Labour Market Report Third Quarter 2007 Alberta Employment, Immigration and Industry
TABLE OF CONTENTS Introduction...4 Organization of the Report...4 Executive Summary...5 The Economy...13 Global Economy...13 U.S. Economy...14 Canadian Economy...15 Contributory Influences... 16 Alberta Economy...20 Contributory Influences... 20 Calgary Region Economy...24 Contributory Influences... 24 Trends in the Labour Market...28 Canada...28 Q3 2007... 28 Alberta...31 Q3 2007... 31 Calgary Census Metropolitan Area (CMA)...34 Q3 2007... 34 Community Profiles...35 Towns of Turner Valley and Black Diamond...35 Population... 35 Employment... 37 Other Communities in the Calgary Region...38 Housing... 38 Inventory of Projects... 40 Community News... 42 Industry Profiles...45 Offices of Physicians, Dentists and Other Health Practitioners...45 Industry Overview... 45 Survey Results... 47 High Demand Occupations Descriptions... 53 Summary of Recruitment and Retention Issues and Additional Comments... 55 Personal Care Services...59 Industry Overview... 59 Survey Results... 61 High Demand Occupations Descriptions... 66 Summary of Recruitment and Retention Issues and Additional Comments... 67 Accounting, Tax Preparation, Bookkeeping and Payroll Services...71 Industry Overview... 71 Survey Results... 73 High Demand Occupations Descriptions... 78 Summary of Recruitment and Retention Issues and Additional Comments... 79 Labour Market Information Review...83 Labour Market News Highlights...83 Alberta Employment, Immigration and Industry 2
Volume 9. Issue 7. July 2007... 83 Volume 9. Issue 8. August 2007... 83 Volume 9. Issue 9. September 2007... 83 Employer Labour Market News Highlights...84 Volume 2. Issue 4. July 2007... 84 Volume 2. Issue 5. September 2007... 84 Job Ad Analysis...85 Summary of Job Postings... 85 Appendix A Survey Methodology...89 Selection of Survey Sample...89 Survey Process...89 Disclaimer Alberta Employment, Immigration and Industry has made every effort to ensure that the information contained in this report is reliable, but makes no guarantee of its accuracy or completeness. The user of any information in this report accepts full responsibility and risk of loss resulting from decisions made by the user. Statistics Canada information is used with the permission of Statistics Canada. Users are forbidden to copy the data and redisseminate them, in an original or modified form, for commercial purposes, without permission from Statistics Canada. Information on the availability of the wide range of data from Statistics Canada can be obtained from Statistics Canada's Regional Offices, its World Wide Web site at www.statcan.ca, and its toll-free access number 1-800-263-1136. Alberta Employment, Immigration and Industry 3
INTRODUCTION Alberta Employment, Immigration and Industry provides career and labour market information products and resources, with both a provincial and local/regional focus, in order that Albertans have the skills, supports and information they need to succeed in the labour market. This report provides labour market information and analysis for use by Albertans in learning about the labour market and career planning; by employers and industry for use in understanding and addressing labour market issues; and by the Alberta Employment, Immigration and Industry Calgary Region for use in strategic planning for programs and services. ORGANIZATION OF THE REPORT This report contains the following information: Economic Overview The Calgary region s economy is influenced by global economic conditions, and by economic drivers in the Canadian economy and elsewhere in Alberta. This section provides information on economic activity in the third quarter of 2007, as well as outlooks (where available) for the international, U.S., Canada, Alberta and Calgary region economies. Trends in the Labour Market This section examines labour market information for Canada, Alberta and the Calgary Census Metropolitan Area (CMA). The information provided in this section is based upon Statistics Canada s Labour Force Survey. Community Profiles This section highlights some of the happenings in the third quarter of 2007 in the communities surrounding Calgary, along with a more detailed profile of the Towns of Turner Valley and Black Diamond. Industry Profiles This section highlights findings from surveys conducted of Calgary and area businesses in the following three industries: offices of physicians, dentists and other health practitioners; personal care services; and accounting, tax preparation, bookkeeping and payroll services. Labour Market Information Review The Calgary & Area Labour Market News, published monthly, provides current labour market information and analysis geared toward job seekers. The Calgary & Area Employer Labour Market News, published bi-monthly, is geared toward employers, business and industry. This section highlights the content in the July, August and September 2007 issues. Alberta Employment, Immigration and Industry 4
EXECUTIVE SUMMARY The Economy Global Economy The global economy is predicted to perform strongly in 2007, with real Gross Domestic Product (GDP) expanding by 5 per cent. Although the crisis in the U.S. sub-prime mortgage market (that extends credit to high-risk borrowers) in August produced aftershocks in global financial markets, the resulting tighter credit conditions is expected to slow the pace of expansion only marginally in Japan, the UK and the Euro-zone. A more severe slowdown is projected for the U.S. economy. Diminished growth prospects in developed countries are likely to dampen exports from Latin America and Asia. However, the largest regional economies of Latin America are expected to withstand the impact through solid growth in domestic spending and the diversion of trade flows towards fastergrowing foreign markets. Asia and emerging markets are predicted to continue to experience robust output growth as a result of strong demand for commodities from China, growing intra-regional trade and production in global supply chains. During the first half of 2007, China s share of global GDP growth exceeded that of the U.S. for the first time. Over the period January to August 2007, China recorded a trade surplus totaling $160 billion, up 70 per cent from the same period in 2006. The U.S. Energy Information Administration projects that world oil consumption in the fourth quarter of 2007 will exceed fourth quarter 2006 levels by 1.8 million barrels per day. West Texas Intermediate (WTI) oil prices are predicted to remain above U.S. $70 per barrel in 2008, barring markedly weaker global economic growth. As a result of the decline in the value of the U.S. dollar against other currencies, many countries will not experience the full effect of the rise in dollardenominated oil prices. U.S. Economy The U.S. economy grew at an annualized rate of 3.8 per cent in the second quarter of 2007, up substantially from the 0.6 per cent annualized rate in the first quarter. The faster pace of real GDP growth in the second quarter primarily reflected a downturn in imports, and an increase in federal government spending, business investment, and exports. Amid concerns over the prospective slowdown tipping the U.S. economy into a recession, the U.S. Federal Reserve responded with a reduction in the federal funds target rate by 50 basis points to 4.75 per cent in September. In August 2007, housing starts in the U.S. reached their lowest level since August 1995 as a result of depressed demand, high inventories of existing homes and increased contract cancellations. During the final quarter of 2007, it is expected that the tightening mortgage market will further reduce housing starts. The U.S. economy is projected to grow at a slow pace for the remainder of the year. Falling home values (which reduce the available home equity that can be used to finance purchases) and tighter credit conditions will pose constraints to consumer spending increases. The most recent forecasts of real GDP growth in the U.S. range between 1.8 per cent and 2.0 per cent in 2007, and 1.6 per cent and 2.4 per cent in 2008. Alberta Employment, Immigration and Industry 5
Canadian Economy Real GDP in Canada expanded at a 3.9 per cent annualized rate in the first quarter of 2007, and 3.4 per cent in the second quarter. Consumer spending fueled growth during the first half of the year, supported by a strong labour market, rising wages and greater than anticipated increases in housing sales and prices. Business investment and exports (except autos) were the other major contributors to economic growth. Real GDP growth in Canada is projected to range between 2.5 per cent and 2.6 per cent in 2007, and 2.2 per cent and 2.5 per cent in 2008, with consumer demand and business investment driving output expansion. Net exports are projected to act as a drag on the national economy. The Canadian dollar averaged 95.73 cents U.S. during the third quarter of 2007. In September, the Canadian dollar returned to parity with the U.S. dollar for the first time in 31 years. The all-items Consumer Price Index (CPI) increased 1.7 per cent in August 2007, compared to August 2006, the lowest increase in the past eight months. The slower increase in the inflation rate was largely attributable to the weakening of gasoline prices in each province. On July 10, 2007, the Bank of Canada raised the target for the overnight rate to 4.50 per cent as a result of inflationary pressures in the economy over the first six months of 2007, and the robust growth of household and business credit. The central bank maintained the target for the overnight rate at 4.50 per cent in its October 16th, 2007 announcement as a result of the dampening impacts on inflation of the strong Canadian dollar and tighter credit conditions stemming from the summer turbulence in financial markets. Canada s population increased by 105,300 in the second quarter of 2007, and reached an estimated total of 32,976,026. An estimated 61,700 immigrants were admitted to Canada during the second quarter of 2007, down from 67,900 in the second quarter of 2006. Alberta Economy While workers continue to migrate to Alberta, rising living costs have begun to moderate the pace of inflows. BMO Capital Markets is forecasting house price growth, employment, and retail sales will all moderate in 2007. The most recent available forecasts of real GDP growth in Alberta range between 3.9 per cent and 5.0 per cent in 2007, and 2.8 per cent and 4.7 per cent in 2008. From January to August 2007, the price of WTI crude oil averaged $64.81 U.S. per barrel down 6 per cent from an average of $68.77 U.S. per barrel in the first eight months of 2006. From January to June 2007, natural gas prices averaged $6.60 C$ per gigajoule (GJ) down 2.4 per cent from an average $6.76 C$ per GJ in the first six months of 2006. On average, there were 244 active drilling rigs from January to August 2007, a 37 per cent decrease from the first eight months of 2006. On September 18, 2007, the Government of Alberta released a report of an independent panel of experts entitled Our Fair Share, which outlined recommendations on how the government can modify the existing provincial royalty structure. The Government is expected to provide a formal response to the report by mid-october 2007. In August 2007, Alberta recorded a year over year inflation rate of 4.7 per cent, compared to the national average of 1.7 per cent. Alberta Employment, Immigration and Industry 6
In 2006, average re-sale prices in Alberta increased 31 per cent to $285,383, compared to 2005. The Canadian Real Estate Association (CREA) is forecasting average re-sale prices in Alberta will increase 25 per cent to $355,600 in 2007, and 6.6 per cent to $379,000 in 2008. Year over year, retail sales in Alberta were up 9.2 per cent to an estimated $5.21 billion in July 2007. Alberta recorded the second highest provincial year over year increase in July 2007 more than double the national increase of 4.5 per cent. From January to July 2007, average weekly earnings of Alberta payroll employees increased 4.8 per cent compared to the first seven months of 2006, while the national increase was 3.2 per cent over the same period. From April 1 to June 30, 2007, Alberta s population grew by 0.7 per cent to a total of 3,474,000, a rate of growth of more than twice the national increase of 0.3 per cent. Although Alberta continues to lead the provinces in population growth, Alberta s gains from net interprovincial migration are easing. Calgary Regional Economy The Conference Board of Canada has estimated that real GDP in the Calgary CMA increased 7.7 per cent in 2006, led by strong growth in the service-producing industries. In 2007, real GDP growth is forecast to reach 4.4 per cent. In August 2007, consumer prices in Calgary rose 4.3 per cent year over year. Total housing starts in the Calgary CMA declined 4 per cent on a year over year basis in August 2007. While single-detached starts decreased 31 per cent year over year in August 2007, multifamily starts increased an incredible 50 per cent. New housing price increases cooled significantly in the Calgary CMA in August 2007. On a month over month basis, the new housing price index (1997 = 100) remained unchanged compared to the previous month. Year over year, the Calgary CMA recorded an increase in prices of 6.1 per cent in August 2007. The average price of a single-family metro home in Calgary in August 2007 was $485,914, up 13 per cent from the average price of $429,855 in August 2006. The average price of a metro condo in Calgary in August 2007 was $320,790, up 13 per cent from the average price of $283,547 in August 2006. The total value of building permits in the Calgary CMA amounted to $4.4 billion from January to August 2007, a 29 per cent increase compared to the first eight months of 2006. In the third quarter of 2007, investment in non-residential building construction (industrial, commercial and institutional) rose significantly in the Calgary CMA to $1.26 billion, a 10 per cent increase from the second quarter of 2007. As a result of a slowdown in energy sector activity due in part to low natural gas prices and increased production costs, demand for office space in Downtown Calgary cooled slightly in the first half of 2007. Trends in the Labour Market Canada Employment in Canada was estimated at 16,881,200 in the third quarter of 2007, an increase of 70,200 from the second quarter of 2007. Year over year, employment has increased by 384,000. Alberta Employment, Immigration and Industry 7
Alberta The seasonally adjusted unemployment rate in the third quarter of 2007 decreased to 6.0 per cent, down from 6.1 per cent in the second quarter of 2007, and 6.4 per cent in the third quarter of 2006. On a quarter over quarter basis, the employment gain in the third quarter of 2007 was entirely a result of an increase in full-time work. On a year over year basis, however, part-time employment increased 3 per cent in the third quarter of 2007, while full-time employment increased 2 per cent. Women accounted for 57 per cent of the employment increase in the third quarter of 2007 (39,700) compared to the second quarter of 2007. Year over year, employment growth for women (2.7 per cent) exceeded that for men (2.0 per cent) in the third quarter of 2007. In the third quarter of 2007, employment growth for adults (0.5 per cent) was slightly higher than that of youth aged 15 24 (0.2 per cent) compared to the previous quarter, as a result of a slight decline in youth employment in September 2007. On a year over year basis, however, employment growth for youth aged 15 24 (2.9 per cent) was higher than that of adults (2.2 per cent) in the third quarter of 2007. Strong employment growth occurred year over year in the third quarter of 2007 in a number of industries including utilities (17.9 per cent), construction (7.4 per cent), accommodation and food services (5.5 per cent), and professional, scientific and technical services (5.2 per cent). Employment in Alberta in the third quarter of 2007 increased by 20,600 from the second quarter of 2007, and by 94,500 year over year. Alberta s seasonally adjusted unemployment rate decreased to 3.5 per cent in the third quarter of 2007, down from 3.7 per cent in the second quarter of 2007, and 3.8 per cent in the third quarter of 2006. On a year over year basis, there were increases in both full-time and part-time employment in the third quarter of 2007, with full-time employment accounting for 90 per cent of the total employment gain. Employment growth for women (5.3 per cent) exceeded that for men (4.6 per cent), while employment growth for adults aged 25 to 64 (5.2 per cent) exceeded that for youth aged 15 to 24 (3.6 per cent). On a year over year basis, there was strong employment growth in the third quarter of 2007 in a number of industries in Alberta including wholesale trade (26.4 per cent), utilities (17.4 per cent), business, building and other support services (17.2 per cent), and construction (13.9 per cent). In the third quarter of 2007, there was significant year over year employment growth across a number of occupations. The most significant increases occurred in art, culture, recreation and sport (38.2 per cent), trades, transport and equipment operators and related occupations (10.0 per cent), business, finance and administrative occupations (8.3 per cent), and natural and applied sciences and related occupations (8.1 per cent). Calgary Census Metropolitan Area (CMA) Total employment in the Calgary CMA in the third quarter of 2007 increased by 10,100 from the second quarter of 2007, and by 32,600 year over year. Employment gains in the Calgary CMA in the third quarter of 2007, on a year over year basis, accounted for 35 per cent of the increase in provincial employment. The unemployment rate in the Calgary CMA decreased to 3.3 per cent in the third quarter of 2007, down from 3.5 per cent in the second quarter of 2007, and 3.6 per cent in the third quarter of 2006. Alberta Employment, Immigration and Industry 8
Community Profiles Towns of Turner Valley and Black Diamond Turner Valley is located 60 km southwest of Calgary along Highway #22. Black Diamond, Turner Valley s sister town, is located 3 km east of Turner Valley. Both towns are located in the Municipal District of Foothills No. 31 along with the towns of High River and Okotoks. In 2006, the Municipal District of Foothills No. 31 had a population of approximately 19,700, a 19 per cent increase from 2001. On October 15, 2007, Turner Valley and Black Diamond residents will have the opportunity to vote on whether to amalgamate their towns, creating one municipality and uniting their administration. Although the towns of Turner Valley and Black Diamond both have a population of approximately 1,900 each, Turner Valley has grown at a much faster rate than Black Diamond since 2001. Turner Valley s population has grown almost 19 per cent from 2001 to 2006, while Black Diamond s population has grown 2 per cent over the same time period. According to the 2001 federal census, 61 per cent of Turner Valley s population and 59 per cent of Black Diamond s population aged 20 and over have some post-secondary education. In comparison, 69 per cent of Calgary s population aged 20 and over has some post-secondary education with 24 per cent holding a university degree. The majority of the workforces in both Turner Valley and Black Diamond are employed in the business and community services, retail and wholesale, and construction industries. Other Communities in the Calgary Region Alberta Employment, Immigration and Industry s Calgary Region includes the following communities surrounding the City of Calgary: Airdrie, Banff, Beiseker, Black Diamond, Canmore, Chestermere, Cochrane, Crossfield, High River, Irricana, Okotoks, and Turner Valley. Total housing starts in the Calgary CMA decreased in the first eight months of 2007 to a total of 9,418 units, a 21.5 per cent decline from the same period in 2006. Single-detached starts totaled 5,417 units year to date in August 2007, a 27 per cent decline from the same period in 2006, while multi-family starts totaled 4,001, a 12 per cent decrease from the first eight months of 2006. The total number of resale housing units sold in the towns outside Calgary in September 2007 totaled 363, a 10.4 per cent decrease from September 2006. From January to September 2007, 4,407 resale housing units were sold, representing a 2.8 per cent increase from the same period in 2006. Average combined residential sale prices in the towns outside Calgary increased 23.7 per cent in September 2007 to $400,938, compared to September 2006. From January to September 2007, average residential sale prices in the towns increased 29.8 per cent compared to the first nine months of 2006. Alberta Employment, Immigration and Industry estimates that over $2.61 billion in major capital projects are either proposed, announced, or under construction in select communities surrounding Calgary. Alberta Employment, Immigration and Industry 9
Industry Profiles In the third quarter of 2007, a survey was conducted of Calgary and area businesses from the following industries: Offices of Physicians, Dentists, and Other Health Practitioners (NAICS 6211/6212/6213); Personal Care Services (NAICS 8121); and Accounting, Tax Preparation, Bookkeeping and Payroll Services (NAICS 5412). The purpose of the survey was to gain a better understanding of current hiring issues and future hiring projections, assess if Calgary and area employers were experiencing any hiring challenges in these industries, and obtain insight on current hiring practices including training and retention strategies. Offices of Physicians, Dentists, and Other Health Practitioners A total of 100 surveys were completed for the Offices of Physicians, Dentists, and Other Health Practitioners industry. Fifty-one offices reported difficulty hiring new staff. Other significant findings included: Of the 51 offices having difficulty hiring, 19 of those reported difficulty in hiring receptionists. The next most common occupation offices reported difficulty hiring was dental assistants, followed by dental hygienists, and other assisting occupations in support of health services (medical office assistants, chiropractic assistants, optometrist assistants, optical assistants, and physiotherapy assistants). Thirty-eight per cent of the office surveyed said the labour shortage in Calgary is affecting their business. Twenty-five offices said employees have had to cover other positions, 24 offices reported employee stress has increased, and 13 said employees are working more overtime. The Calgary Herald was the most common resource used to recruit employees in this industry, followed by employee referrals/word of mouth, and the Internet. Calgaryjobshop.ca and Service Canada s JOB Bank were the Internet sites most often mentioned. Relevant work experience and education/training were the most common responses when asked, What skills or competencies are difficult to find? mentioned by 63 and 56 offices respectively. Eighty-three per cent of the offices surveyed said they provide some type of training to their employees. A good company culture was the retention strategy most often mentioned by offices, followed by a competitive salary. Twenty-three offices reported that excellent leadership/management retained their office staff. Respondents were asked to identify additional positions they expected to hire in the next three months. The highest demand occupations as indicated by the survey results are for dental assistants, medical/dental receptionists, opticians, and dental hygienists. Personal Care Services A total of 100 surveys were completed for the Personal Care Services industry. Forty-two per cent of companies reported difficulty hiring new staff. Other significant findings included: Of the 42 companies having difficulty hiring, 17 reported having difficulty hiring hairstylists and barbers. Estheticians and receptionists were the next most common occupations companies were having difficulty hiring. Forty per cent of the companies surveyed said the labour shortage in Calgary is affecting their business. Twenty-six companies said employee stress has increased, 22 said they have had to increase wages, and 17 companies reported employees are working more overtime. Alberta Employment, Immigration and Industry 10
Employee referrals/word of mouth was the most common resource used to recruit employees, reported by 62 companies, followed by walk-ins/unsolicited resumes and the Calgary Sun. When asked what skills or competencies are difficult to find when looking for new employees, education/training, relevant work experience and interpersonal skills were the top responses. Eighty-six per cent of the companies surveyed said they provide some type of training to their employees. The most effective methods reported for retaining existing employees were a good company culture, flexible work measures, and a competitive salary. Respondents were asked to identify additional positions they expected to hire in the next three months. The highest demand occupations as indicated by the survey results are for hairstylists and barbers, estheticians, and receptionists. Accounting, Tax Preparation, Bookkeeping and Payroll Services A total of 100 surveys were completed for the Accounting, Tax Preparation, Bookkeeping and Payroll Services industry. Thirty-six companies reported difficulty hiring new staff. Other significant findings included: Of the 36 companies having difficulty hiring, 11 of those reported difficulty in hiring bookkeepers and accounting technicians. The next most common occupation companies reported difficulty hiring was auditors and accounts, followed by administrative assistants, accounting clerks and income tax preparers. Thirty-seven per cent of the companies surveyed said the labour shortage in Calgary is affecting their business. Twenty-two companies said employee stress has increased, 13 reported they have had to turn down business/clients, and 12 said employees are working more overtime and employees have had to cover other positions. Employee referrals/word of mouth was the most common resource used to recruit employees in this industry, followed by the Calgary Herald, and the Internet. Service Canada s JOB Bank was the Internet site most often mentioned, followed by Calgaryjobshop.ca, Workopolis.com and Monster.ca. Relevant work experience was overwhelmingly the most common response when asked, What skills or competencies are difficult to find? reported by 75 companies. Relevant education/training and work ethic were also mentioned as difficult to find. Eighty-four per cent of the companies surveyed said they provide some type of training to their employees. A good company culture was the retention strategy most often mentioned by companies, followed by flexible work measures and a competitive salary. Respondents were asked to identify additional positions they expected to hire in the next three months. The highest demand occupations as indicated by the survey results are for bookkeepers, accounting technicians, and accountants. Labour Market Information Review Labour Market News Highlights The Calgary & Area Labour Market News, published monthly, provides current labour market information and analysis geared toward job seekers. The full articles are available on the Alberta Employment, Immigration and Industry website at http://www.employment.gov.ab.ca/cps/rde/xchg/hre/hs.xsl/2396.html Alberta Employment, Immigration and Industry 11
Employer Labour Market News Highlights The Calgary & Area Employer Labour Market News, published bi-monthly, is geared toward employers, business and industry. The full articles are available on the Alberta Employment, Immigration and Industry website at http://www.employment.gov.ab.ca/cps/rde/xchg/hre/hs.xsl/2397.html Job Ad Analysis Beginning in March 2007, the Calgary Labour Market News bulletin took a different approach to the job ad analysis. The categories for industry and occupation were changed to match the North American Industry Classification System (NAICS) and National Occupation Code (NOC). The following sources have been analyzed since March 2007: Calgary Herald Working section: job postings every Saturday in March 2007 Workopolis.com website: job postings every Thursday in April 2007 Calgary Sun Classified section: job postings every Friday in May 2007 JOB Bank website: job postings every Friday in June 2007 Calgary Herald Classified section: job postings every Friday in July 2007 Monster.ca website: job postings every Friday in August 2007 From March August 2007, close to 7,200 jobs have been included in the analysis and reported on. Job Ads by Industry The representation of job ads by industry was weighted in favour of the Construction industry, which had 18 per cent of all the job ads. The Transportation and Warehousing industry was second with 12 per cent, followed by the Retail Trade and Accommodation and Food Services industries (11 per cent each). Job Ads by Occupation Trades, Transport and Equipment Operators and related occupations, as well as Sales and Service occupations represented close to 60 per cent of all the job ads analyzed. Business, Finance and Administration occupations came in third representing 17 per cent of all the job ads. None of the other occupation categories comprised more than 8 per cent of the total number of job ads. Alberta Employment, Immigration and Industry 12
THE ECONOMY The Calgary region s economy is affected by global economic activity, economic conditions in the U.S., and economic drivers in the Canadian economy and elsewhere in Alberta. GLOBAL ECONOMY The global economy is predicted to perform strongly in 2007, with real GDP expanding by 5 per cent. Although the crisis in the U.S. sub-prime mortgage market (that extends credit to high-risk borrowers) in August produced aftershocks in global financial markets, the resulting tighter credit conditions is expected to slow the pace of expansion only marginally in Japan, the UK and the Euro-zone. A more severe slowdown is projected for the U.S. economy. Lack of adequate transparency has made it difficult to fish out the subprime, mortgagebacked debt that has been spliced and diced around the world. The resultant lack of trust in financial markets is keeping risk premiums elevated and diminishing access to credit to a modest degree. 1 Diminished growth prospects in developed countries are likely to dampen exports from Latin America and Asia. However, the largest regional economies of Latin America are expected to withstand the impact through solid growth in domestic spending and the diversion of trade flows towards faster-growing foreign markets. 2 Asia and emerging markets are predicted to continue to experience robust output growth as a result of strong demand for commodities from China, growing intra-regional trade and production in global supply chains. During the first half of 2007, China s share of global GDP growth exceeded that of the U.S. for the first time. 3 Over the period January to August 2007, China recorded a trade surplus totaling $160 billion, up 70 per cent from the same period in 2006. 4 The surging numbers of Chinese food, drugs, toys and other products that are being recalled or identified as potentially hazardous has prompted concerns over the safety of exports from China. In response, the Chinese government has announced that it will step up quality inspections of products destined for export. World Oil In China, the massive longer-term infrastructural investments now being undertaken, in conjunction with surging consumer spending, should be sufficient to keep growth from dropping below 10% - a little more than a percentage point below that country s recent break-neck pace. Similarly, the Indian economy should continue to expand by 8% or more through 2008. These global growth leaders will be expanding at more than four times the average rate experienced by developed nations. 5 Oil prices proved to be resilient to the recent turmoil experienced in financial markets, and are expected to remain strong for the remainder of 2007. West Texas Intermediate (WTI) crude oil prices averaged U.S.$75.24 per barrel in the third quarter of 2007, compared to U.S.$70.51 per barrel in the third quarter of 2006 and U.S.$64.96 per barrel in the second quarter of 2007. 6 A combination of strong worldwide demand, 1 2 3 4 5 6 TD Bank Financial Group, TD Economics, TD Quarterly Economic Forecast, October 4, 2007, page 7. Scotiabank Group, Global Economic Research, Global Outlook, Fall 2007, page 8. The Economist Intelligence Unit Ltd., Heading for the rocks: Will financial turmoil sink the world economy? EIU Special Report August 2007, page 8. National Bank Financial, Monthly Economic Monitor, October 2007, page 3. Scotiabank Group, Global Economic Research, Global Outlook, Fall 2007, page 4. www.uprr.com/customers/surcharge/wti.shtml Alberta Employment, Immigration and Industry 13
low surplus production capacity, and low petroleum inventories pushed crude oil prices above U.S.$80 per barrel near the end of the third quarter of 2007. At its September 11 th meeting, OPEC member countries agreed to increase output by 500,000 barrels per day effective November 1, 2007 in order to prevent a slowing in the pace of worldwide economic expansion. The U.S. Energy Information Administration projects that world oil consumption in the fourth quarter of 2007 will exceed fourth quarter 2006 levels by 1.8 million barrels per day. WTI oil prices are predicted to remain above U.S. $70 per barrel in 2008, barring markedly weaker global economic growth. As a result of the decline in the value of the U.S. dollar against other currencies, many countries will not experience the full effect of the rise in dollar-denominated oil prices. 7 U.S. ECONOMY The U.S. economy grew at an annualized rate of 3.8 per cent in the second quarter of 2007, up substantially from the 0.6 per cent annualized rate in the first quarter. The faster pace of real GDP growth in the second quarter primarily reflected a downturn in imports, and an increase in federal government spending, business investment, and exports. Real personal consumption expenditures slowed from an expansion of 3.7 per cent in the first quarter of 2007 to 1.4 percent in the second quarter. Pre-tax corporate profits increased by 6.4 per cent in the second quarter of 2007 compared to the first quarter, and by 4.8 percent compared to the same quarter the previous year. 8 The strong performance of the U.S. economy during the second quarter of 2007 predated the financial turmoil unleashed in the third quarter stemming from the sub-prime mortgage crisis. This summer, mortgage defaults began to soar as more and more Americans found themselves suddenly unable to keep up with rising interest payments. Investment funds heavily invested in sketchy mortgages buckled, touching off credit fears in other sectors. 9 Amid concerns over the prospective slowdown tipping the U.S. economy into a recession, the U.S. Federal Reserve responded with a reduction in the federal funds target rate by 50 basis points to 4.75 per cent in September. This rate cut bolstered equity markets, eased pressure on short-term borrowing costs, and contributed to the depreciation of the U.S. dollar. In August 2007, housing starts in the U.S. reached their lowest level since August 1995 as a result of depressed demand, high inventories of existing homes and increased contract cancellations. 10 During the final quarter of 2007, it is expected that the tightening mortgage market will further reduce housing starts. It s now a horserace between falling supply and demand in the housing market. The former may finally be falling faster than the latter, which will help clear out the glut of unsold homes on the market and eventually stem the downward slide in prices. But with tighter credit and falling prices themselves acting as a brake on demand, the downside risks loom large. 11 The U.S. economy is projected to grow at a slow pace for the remainder of the year. Falling home values (which reduce the available home equity that can be used to finance purchases) and tighter credit conditions 7 8 9 10 11 Energy Information Administration, Short-Term Energy and Winter Fuels Outlook, October 9, 2007 http://www.eia.doe.gov/emeu/steo/pub/contents.html#global_petroleum_markets U.S. Department of Commerce, Bureau of Economic Analysis, News Release: Gross Domestic Product and Corporate Profits, September 27, 2007. Colin Campbell and Jason Kirby, Can you say recession? MacLeans, October 8, 2007, page 2. Scotiabank Group, Global Economic Research, Weekly Trends, September 28, 2007, page 4. BMO Capital Markets, econofacts, U.S. Housing Starts Caving In, September 19, 2007. Alberta Employment, Immigration and Industry 14
will pose constraints to consumer spending increases. Even though it is predicted that U.S. consumers will scale back expenditures on big-ticket items such as autos, appliances, home furnishing and luxury goods, the economy will continue to expand as long as there is job growth and real earnings increase. 12 Although average monthly job growth has clearly slowed since the beginning of the year, the unemployment rate remains near a cycle low of 4.6% and incomes have been climbing at a robust 6.5% y/y for the better part of 2007 That being said, large downward revisions to June and July s jobs data, as well as a growing pile of layoff announcements in the construction and financial services sectors, point to a prolonged weakening. 13 A modest offset to the forces slowing the economy is the depreciation of the U.S. dollar against almost every major currency which is expected to provide a stimulus to exports, in particular U.S.-made capital goods. The most recent forecasts of real GDP growth in the U.S. range between 1.8 per cent and 2.0 per cent in 2007, and 1.6 per cent and 2.4 per cent in 2008. Table 1: Real Gross Domestic Product Forecast: U.S. (% change) Forecast Agency Date Released 2007 2008 Economist Intelligence Unit August 2007 1.9 2.3 BMO Capital Markets Sep 2007 1.9 2.2 TD Bank Financial Group Oct 2007 2.0 2.4 CIBC World Markets Sep 2007 1.9 2.3 Scotiabank Group Fall 2007 1.9 2.0 National Bank Oct 2007 1.8 1.6 Bank of Canada Oct 2007 1.9 2.1 CANADIAN ECONOMY Real GDP in Canada expanded at a 3.9 per cent annualized rate in the first quarter of 2007, and 3.4 per cent in the second quarter. Consumer spending fueled growth during the first half of the year, supported by a strong labour market, rising wages and greater than anticipated increases in housing sales and prices. 14 Business investment and exports (except autos) were the other major contributors to economic growth. Unlike the deteriorating housing market conditions in the U.S., the Canadian housing market is buoyant. Credit standards in Canada were never loosened as they were in the U.S. (the sub-prime mortgage market in Canada comprised approximately 5 per cent of mortgage originations in 2006 compared to 25 per cent in the U.S). 15 In contrast to the U.S. experience, the Canadian housing market remains in strong shape, with housing starts running well above the 200k mark and with resale markets delivering record activity levels in the first half of the year. In contrast to the price declines south of the border, resale home prices in Canada are on track for a 10% gain this year. 16 12 13 14 15 16 TD Bank Financial Group, TD Economics, TD Quarterly Economic Forecast, October 4, 2007, page 2. Scotiabank Group, Foreign Exchange Outlook, October 2007, page 5. Bank of Canada, Remarks by David Dodge Governor of the Bank of Canada to the Vancouver Board of Trade, Vancouver, British Columbia, 25 September 2007, page 5. TD Bank Financial Group, TD Economics, TD Quarterly Economic Forecast, October 4, 2007, page 4. Ibid, page 5. Alberta Employment, Immigration and Industry 15
Housing markets may have started to cool in Alberta, but ongoing strength nation-wide should continue to provide enormous spill-over benefits across the gamut of goods and services industries. 17 The tighter credit conditions resulting from the recent turmoil in financial markets are predicted to temper the expansion of the Canadian economy to a modest extent. Real GDP growth in Canada is projected to range between 2.5 per cent and 2.6 per cent in 2007, and 2.2 per cent and 2.5 per cent in 2008, with consumer demand and business investment driving output expansion. Net exports are projected to act as a drag on the national economy. Exports will be constrained by the weaker performance of the U.S. economy and the appreciation of the Canadian dollar, while lower prices for goods produced outside Canada will lead to increased imports. It is estimated that nearly 30 per cent of national GDP is comprised of the production of U.S. destined goods. 18 Although China displaced Canada this year as the world s largest supplier of goods to the U.S., 19 76 per cent of Canada s exports are destined to the U.S. (down from a peak of 82 per cent in 2005). 20 However, strong global demand for energy and other commodities is expected to partially insulate Canada from the effects of weaker U.S. growth. Table 2: Real Gross Domestic Product Forecast: Canada (% change) Forecast Agency Date Released 2007 2008 BMO Capital Markets Sep 2007 2.5 2.4 Scotiabank Group Fall 2007 2.5 2.2 TD Bank Financial Group Oct 2007 2.6 2.3 CIBC World Markets Sep 2007 2.5 2.5 National Bank Oct 2007 2.5 2.2 Bank of Canada Oct 2007 2.6 2.3 CONTRIBUTORY INFLUENCES A number of factors influence the Canadian economy. Canadian Dollar The Canadian dollar averaged 95.73 cents U.S. during the third quarter of 2007. 21 In September, the Canadian dollar returned to parity with the U.S. dollar for the first time in 31 years. The ascent of the loonie can be attributed to the following forces: The narrowing of U.S.-Canada interest rate spreads as a result of the recent cut in the federal funds rate, making Canada more attractive to international investors; High commodity prices - particularly for oil, wheat and gold; and Solid Canadian economic fundamentals - including a strong trade surplus, sustained employment and income growth, and a decade of federal budget surpluses. 17 18 19 20 21 TD Bank Financial Group, TD Economics, The Weekly Bottom Line, September 28, 2007, page 2. Scotiabank Group, Foreign Exchange Outlook, October 2007, page 5. CIBC World Markets, StrategEcon, September 20, 2007, page 11. TD Bank Financial Group, TD Economics, TD Quarterly Economic Forecast, October 4, 2007, page 12. Bank of Canada, Financial Markets Department, Monthly Average of Exchange Rates, www.bankofcanada.ca/en/rates/exchange.html Alberta Employment, Immigration and Industry 16
By reducing the cost of imports, the high value of the loonie could help slow inflation growth in Canada. But the forestry, tourism and manufacturing industries that rely on export demand from U.S. markets have lost the built-in competitive advantage of Canada s exchange rate. Regardless of the industry, firms that become more competitive through innovation and productivity improvements (e.g. through investment in new equipment or technology) are more likely to succeed in the high loonie environment. 22 The value of the Canadian dollar is forecast to average between 96.2 cents U.S. and 103.1 cents U.S. in the fourth quarter of 2007. By the third quarter of 2008, most forecast agencies are predicting that the Canadian dollar will slip below parity with the U.S. dollar. But another big move by the Canadian dollar cannot be ruled out. Given the fact that the U.S. dollar s downward tilt still has some distance to go, commodity prices are gathering steam again, and the Canadian economy continues to display remarkable resiliency in the face of the soaring loonie, it s tough to bet against further strength later down the line. 23 Table 3: Exchange Rate Forecast End of Quarter (US cents/canadian $) Date Released Q4 2007 Q1 2008 Q2 2008 Q3 2008 TD Bank Financial Group Oct 2007 101.0 100.0 99.0 97.0 BMO Capital Markets* Sep 2007 100.2 101.0 100.4 98.5 CIBC World Markets Sep 2007 100.0 100.0 96.2 95.2 National Bank Financial Oct 2007 96.2 98.0 100.0 100.0 RBC Financial Group Sep 2007 103.1 102.0 98.0 96.2 Scotiabank Group Oct 2007 98.0 102.0 103.0 102.0 * Average for the quarter Inflation The consumer price index (CPI) provides a broad measure of the cost of living in Canada. The Bank of Canada monitors changes in the CPI in deciding when to tighten monetary conditions to keep inflation within the range of the inflation-control target it has set (2.0 per cent). To assess the trend of inflation, the Bank of Canada monitors the core CPI measure, which excludes eight of the CPI s most volatile components (fruit, vegetables, gasoline, fuel oil, natural gas, mortgage interest, intercity transportation and tobacco products). 24 The all-items CPI increased 1.7 per cent in August 2007, compared to August 2006, the lowest increase in the past eight months. The slower increase in the inflation rate was largely attributable to the weakening of gasoline prices in each province. Following a 2.8% drop in July, average prices at the pump were 7.7% lower in August 2007 compared with the same month in 2006. This was the most pronounced decrease in this component since last January. Lower gas prices can partially be explained by the downturn in the average price of crude oil in August compared with the preceding month. With the strength of the Canadian dollar in relation to the US greenback, local refineries 22 23 24 Monte Stewart, Business Edge, Surging loonie buffeting tech sector, Vol. 7, No. 20 (Oct 5, 2007). BMO Capital Markets, Focus A Weekly Financial Digest, September 21, 2007, page 2. Bank of Canada, The Bank in Brief, The Consumer Price Index, January 2000. Alberta Employment, Immigration and Industry 17
were able to pay less for crude oil in August 2007 than they did during the same period in 2006. 25 Mortgage interest cost 26 (+6.1 per cent) and homeowner s replacement cost 27 (+6.0 per cent) were the main contributors to the increase in the 12-month all-items CPI, while in addition to weaker gasoline prices, significant downward pressure on the inflation rate resulted from lower prices for computer equipment and supplies (-17.4 per cent), video equipment (-8.6 per cent), and fresh vegetables (-4.9 per cent). The core CPI increased 2.2 per cent between August 2007 and August 2006, a modest slowdown from the 2.3 per cent increase recorded in July 2007. Most of the increase in the core CPI in August resulted from the increase in homeowners replacement cost. Figure 1: CPI All-items (Canada) % change from the same month of the previous year Consumer Spending Real (inflation-adjusted) consumer spending is projected to increase by 4 percent in 2007, according to TD Bank Financial Group, supported by robust wage growth resulting from the tight labour market. However, growth in consumer spending is predicted to moderate to 3.1 per cent in 2008 as employment growth eases. 25 26 27 Statistics Canada, The Daily, Consumer Price Index August 2007, September 29, 2007, pages 2-3. Statistics Canada. Mortgage interest cost measures changes in the amount of mortgage interest owed by consumers. Statistics Canada. This cost represents replacing the worn-out structural portion of housing and is estimated using new housing prices, excluding land. Alberta Employment, Immigration and Industry 18
Interest Rates The rate of home price appreciation is also expected to continue its moderating trend, limiting the rate by which household wealth will increase. In addition, slightly higher interest rates should take some of the zip off personal expenditure. 28 The Bank of Canada adjusts monetary policy by raising and lowering the target for the overnight rate. The overnight rate is the interest rate at which major financial institutions borrow and lend one-day (or overnight ) funds among themselves; the Bank sets a target level for that rate. This target for the overnight rate is often referred to as the Bank s key interest rate or key policy rate. Changes in the target for the overnight rate influence other interest rates, such as those for consumer loans and mortgages. They can also affect the exchange rate of the Canadian dollar. 29 On July 10, 2007, the Bank of Canada raised the target for the overnight rate to 4.50 per cent as a result of inflationary pressures in the economy over the first six months of 2007, and the robust growth of household and business credit. The central bank maintained the target for the overnight rate at 4.50 per cent in its October 16th, 2007 announcement as a result of the dampening impacts on inflation of the strong Canadian dollar and tighter credit conditions stemming from the summer turbulence in financial markets. The key policy rate is projected to range between 4.00 per cent and 5.25 per cent by the end of the third quarter, 2008. Table 4: Bank of Canada Overnight Rate End of Quarter Projections Date Released Q4 2007 Q1 2008 Q2 2008 Q3 2008 TD Bank Financial Group Oct 2007 4.75 4.75 4.75 4.75 RBC Financial Group Sep 2007 4.50 5.00 5.25 5.25 National Bank Oct 2007 4.25 4.00 4.00 4.00 BMO Capital Markets* Sep 2007 4.50 4.50 4.75 4.75 Scotiabank Group Sep 2007 4.50 4.50 4.50 4.50 * Average for the quarter Population Canada s population increased by 105,300 in the second quarter of 2007, and reached an estimated total of 32,976,026. An estimated 61,700 immigrants were admitted to Canada during the second quarter of 2007, down from 67,900 in the second quarter of 2006. Alberta accounted for 23 per cent of the nation s population growth in the second quarter of 2007, posting a gain of 24,457 people. By comparison the province s population increased by 22,925 people in the second quarter of 2006 and comprised 21.5 per cent of Canada s population increase. 28 29 TD Bank Financial Group, TD Economics, TD Quarterly Economic Forecast, October 4, 2007, page 12. www.bankofcanada.ca/en/monetary/target.html Alberta Employment, Immigration and Industry 19
Alberta s gains resulting from net interprovincial migration were smaller in the second quarter, although levels were still high. While the number of migrants entering Alberta increased marginally, the number of those leaving rose much more rapidly. 30 ALBERTA ECONOMY While workers continue to migrate to Alberta, rising living costs have begun to moderate the pace of inflows. BMO Capital Markets says house price growth, employment and retail sales will all moderate in 2007, albeit to a strong simmer from an outright boil. 31 Alberta conceded its post as Canada s leader in year-over-year retail sales growth in April, but should maintain Canada s lowest unemployment rate, averaging 3.8% in 2007, and strongest pace of employment growth. While average existing home price growth in Calgary has been shaved to 16% y/y, Edmonton prices have surged as much as 52% y/y in 2007. 32 The most recent available forecasts of real GDP growth range between 3.9 per cent and 5.0 per cent in 2007, and 2.8 per cent and 4.7 per cent in 2008. Table 5: Real Gross Domestic Product Forecast: Alberta (% change) Date Released 2007 2008 BMO Capital Markets Summer 2007 4.5 4.0 Scotiabank Group Sep 2007 4.5 3.6 TD Bank Financial Group Sep 2007 4.4 2.8 RBC Financial Group Oct 2007 5.0 4.5 Conference Board of Canada Summer 2007 3.9 4.7 CONTRIBUTORY INFLUENCES A number of factors influence the Alberta economy. Energy Industry The price of West Texas Intermediate (WTI) crude oil averaged $74.56 U.S. per barrel in August 2007, a 2 per cent increase from August 2006. From January to August 2007, the price of WTI crude oil averaged $64.81 U.S. per barrel down 6 per cent from an average of $68.77 U.S. per barrel in the first eight months of 2006. 33 30 31 32 33 Statistics Canada,The Daily, Canada s population estimates, September 27, 2007, page 3. BMO Capital Markets, Provincial Monitor, Summer 2007, p.4. Ibid. Alberta Employment, Immigration and Industry, Monthly Economic Review, September 2007, p.20. Alberta Employment, Immigration and Industry 20
Figure 2: Average Price of West Texas Intermediate Crude Oil (US$/Barrel) Natural gas prices averaged $6.21 C$ per gigajoule (GJ) in June 2007, a 17 per cent increase from June 2006. From January to June 2007, natural gas prices averaged $6.60 C$ per GJ down 2.4 per cent from an average $6.76 C$ per GJ in the first six months of 2006. 34 Figure 3: Average Price of Natural Gas (C$/GJ) The average number of active drilling rigs in Alberta decreased to 234 in August 2007, a 40 per cent drop from the 391 active rigs in August 2006. On average, there were 244 active drilling rigs from January to August 2007, a 37 per cent decrease from the first eight months of 2006. 35 Drilling activity in Alberta declined as a result of the depressing effect on natural gas prices of high inventories, high industry input costs, the soaring value of the Canadian dollar, and competition for capital from the oil sands. On September 18, 2007, the Government of Alberta released a report of an independent panel of experts entitled Our Fair Share, which outlines recommendations on how the government can modify the existing provincial royalty structure. The proposed changes would increase the provincial government s take from the oil and gas industry by about $2 billion annually. 34 35 Ibid. Ibid, p.19. Alberta Employment, Immigration and Industry 21
The Canadian Association of Petroleum Producers (CAPP) has expressed major concerns with some of the report s recommendations and plans on sharing their concerns during the consultation process and working with government throughout the process. 36 The Government is expected to provide a formal response to the report by mid-october 2007. Inflation In August 2007, Alberta recorded a year over year inflation rate of 4.7 per cent, compared to the national average of 1.7 per cent. Provincially, while prices on average were up in all provinces, only Alberta, and Saskatchewan (2.4 per cent) had prices rise faster than the national average between August 2006 and August 2007. This gap has persisted since February 2007 for Saskatchewan and since August 2005 for Alberta. 37 Figure 4: CPI All-items Index August 2007 (Canada and provinces) Percentage change from the same month of the previous year Housing Market Housing starts in Alberta declined to 3,418 in August 2007, a 2 per cent decrease from August 2006. From January to August 2007, housing starts in Alberta decreased to 26,082, a 6 per cent drop from the first eight months of 2006. The overall decrease in housing starts in Alberta from January to August 2007 was mainly a result of a decrease in starts in the Calgary CMA (-21.5 per cent). On a year over year basis, from January to August 2007, housing starts increased in the Lethbridge CA (96.5 per cent), Wood Buffalo CA (64.0 per 36 37 Canadian Association of Petroleum Producers, News Release, Royalty Panel s Report Flawed; Industry Committed to Working Constructively with Government, Calgary, Alberta, September 24, 2007. www.capp.ca Statistics Canada, The Daily, Consumer Price Index, August 2007, September 19, 2007. Alberta Employment, Immigration and Industry 22
cent), Red Deer CA (18.3 per cent), Grand Prairie CA (8.5 per cent), Medicine Hat CA (1.9 per cent), and Edmonton CMA (0.8 per cent). 38 In 2006, the number of homes sold through the Multiple Listing Service (MLS) totaled 74,350 in Alberta, a 13 per cent increase from 2005. The Canadian Real Estate Association (CREA) is forecasting more moderate home sales activity in 2007 and 2008 as a result of higher interest rates and housing price increases. In 2007, MLS re-sales in Alberta are expected to increase 5.6 per cent to 78,550, and then decline by 4.5 per cent in 2008 to 75,030. 39 In July 2007, MLS re-sales totaled 5,938 in Alberta a 7.3 per cent decrease from July 2006. 40 In 2006, average re-sale prices in Alberta increased 31 per cent to $285,383, compared to 2005. CREA is forecasting average re-sale prices in Alberta will increase 25 per cent to $355,600 in 2007, and 6.6 per cent to $379,000 in 2008. 41 Average resale prices in Alberta in July 2007 jumped to $371,817, an increase of 29 per cent from July 2006. Year over year, home prices in Edmonton rose 38 per cent in July 2007, while home prices in Calgary rose 22 per cent. 42 Building Permits From January to August 2007, Alberta builders took out $10.7 billion in building permits ($6.3 billion were residential, $4.4 billion were non-residential), up 23 per cent from the same period in 2006. The value of residential permits increased 17 per cent, while the value of non-residential permits increased 32 per cent. Nationally, builders took out $49.2 billion in building permits from January to August 2007, an increase of 16 per cent from the same period in 2006. The increase nationally was the result of strong growth in nonresidential permits (25 per cent). 43 In August 2007, Alberta builders took out $1.30 billion in building permits, which was a 6 per cent decrease from July. 2007. Residential intentions fell 4 per cent in August 2007 compared to the previous month, while non-residential intentions decreased 9.0 per cent. Non-Residential Building Construction Investment in non-residential building construction 44 in Alberta rose 4 per cent in the third quarter of 2007 compared to the previous quarter, to $2.4 billion. Alberta showed record gains in commercial investment, posting an increase of 7.8 per cent to $1.6 billion. Nationally, investment in non-residential building construction reached $10.4 billion in the third quarter of 2007, an increase of 5 per cent from the second quarter of 2007. 45 Retail and Wholesale Trade In July 2007, retail sales in Alberta declined (-0.2 per cent) following a slight gain of 0.2 per cent in June. Year over year, retail sales in Alberta were up 9.2 per cent to an estimated $5.21 billion in July 2007. Alberta recorded the second highest provincial year over year increase in July 2007 more than double the national increase of 4.5 per cent. Retail sales in Saskatchewan were up 10.8 per cent year over year in July 2007. 46 38 39 40 41 42 43 44 45 46 Canada Mortgage and Housing Corporation, Preliminary Housing Start Data, September 2007. Canadian Real Estate Association, CREA Forecast August 2007, August 20, 2007. Alberta Employment, Immigration and Industry, Weekly Economic Highlights, August 21, 2007. Canadian Real Estate Association, CREA Forecast August 2007, August 20, 2007. Alberta Employment, Immigration and Industry, Weekly Economic Highlights, August 21, 2007. Statistics Canada, The Daily, Building permits, August 2007, October 4, 2007. Includes industrial, commercial and institutional investment. Statistics Canada, The Daily, Investment in non-residential building construction, Third quarter 2007, October 12, 2007. Statistics Canada, The Daily, Retail trade July 2007, September 21, 2007. Alberta Employment, Immigration and Industry 23
Following a strong gain of 6.4 per cent in June 2007, wholesale sales in Alberta increased at a more modest pace in July 2007, increasing 0.9 per cent from the previous month to $5.5 billion. Year over year, wholesale sales in Alberta were up 7.0 per cent in July 2007. Nationally, wholesale sales increased 5.2 per cent to $44.1 billion in July 2007, compared to July 2006. 47 Average Weekly Earnings In July 2007, average weekly earnings of Alberta payroll employees increased 5.9 per cent year over year to $844.90. Over the same period, the national increase in average weekly earnings was 3.7 per cent to $773.32. From January to July 2007, average weekly earnings of Alberta payroll employees increased 4.8 per cent compared to the first seven months of 2006, while the national increase was 3.2 per cent over the same period. 48 Population From April 1 to June 30, 2007, Alberta s population grew by 0.7 per cent to a total of 3,474,000, a rate of growth of more than twice the national increase of 0.3 per cent. Although Alberta continues to lead the provinces in population growth, Alberta s gains from net interprovincial migration are easing. (During the second quarter of 2007), interprovincial migration accounted for 30% of Alberta s overall growth, down from nearly 42% during the second quarter of 2006. 49 As a result of an increase in people leaving the province, Alberta s net gains from interprovincial migration were estimated at only 7,400 people during the second quarter of 2007. The primary source of Alberta s interprovincial in-migrants during the quarter was Ontario (32 per cent or 9,500 people), followed by British Columbia (24 per cent or 7,100 people), Saskatchewan (10 per cent or 2,950 people) and Quebec (9 per cent or 2,800 people). The main destination of out-migrants from Alberta was British Columbia (38 per cent or 8,600 people), followed by Saskatchewan (20 per cent or 4,450 people), and Ontario (17 per cent or 3,850 people). 50 During the second quarter of 2007, Alberta recorded 11,900 births and 5,100 deaths resulting in a natural increase of 6,800 people. 51 CALGARY REGION ECONOMY Real GDP growth in the Calgary Census Metropolitan Area (CMA) is set to build on last year s outcome 52 in 2007, according to the Conference Board of Canada. The Conference Board has estimated that real GDP in the Calgary CMA increased 7.7 per cent in 2006, led by strong growth in the service-producing industries. In 2007, real GDP growth is forecast to reach 4.4 per cent. CONTRIBUTORY INFLUENCES A number of factors influence the Calgary economy. 47 48 49 50 51 52 Statistics Canada, The Daily, Wholesale trade July 2007, September 20, 2007. Statistics Canada, The Daily, Payroll employment, earnings and hours July 2007 (preliminary), September 25, 2007. Statistics Canada, The Daily, Canada s population estimates as of July 1, 2007 (preliminary), September 27, 2007. Alberta Finance, Alberta Population Report Second Quarter 2007, September 27, 2007. Ibid. Conference Board of Canada, Metropolitan Outlook Autumn 2007, p. 62. Alberta Employment, Immigration and Industry 24
Inflation In August 2007, consumer prices in Calgary rose 4.3 per cent year over year. Edmonton had the highest year over year inflation rate in August 2007 (5.4 per cent), followed by Calgary (4.3 per cent), and Saskatoon (3.4 per cent). All other major Canadian cities had a year over year inflation rate of 2.0 per cent or less. 53 Housing Market Total housing starts in the Calgary CMA declined 4 per cent on a year over year basis in August 2007. While single-detached starts decreased 31 per cent year over year in August 2007, multi-family starts (semidetached units, rows and apartments) increased an incredible 50 per cent. According to Canada Mortgage and Housing Corporation (CMHC), the 511 apartments that were started in August 2007 were a record high for any August since 1981. Timing has something to do with the surge, but the price advantage for apartments relative to single-detached units is supporting demand. 54 Many building permits for multi-family construction remain outstanding, so CMHC is forecasting multi-family starts will remain strong for a few months. From January to August 2007, total housing starts in the Calgary CMA decreased 21.5 per cent from 12,001 units in 2006 to 9,418 units in 2007. During the same period, total housing starts in the Edmonton CMA increased 0.8 per cent from 9,979 units in 2006 to 10,060 units in 2007. Table 6: Housing Starts - January to August Single Multiple Total % Change Area 2007 2006 2007 2006 2007 2006 2007/2006 Alberta 14,869 17,230 11,213 10,548 26,082 27,778-6.1% Calgary CMA 5,417 7,450 4,001 4,551 9,418 12,001-21.5% Calgary City 4,177 6,028 3,551 3,852 7,728 9,880-21.8% Edmonton CMA 697 784 581 425 1,278 1,209 5.7% Edmonton City 310 466 503 343 813 809 0.5% Source: Canada Mortgage and Housing Corporation New housing price increases cooled significantly in the Calgary CMA in August 2007. On a month over month basis, the new housing price index (1997 = 100) remained unchanged compared to the previous month. Regina had the largest increase in prices for new homes in Canada in August 2007 compared to the previous month (5.3 per cent and its largest one-month increase in over 20 years), followed by Saskatoon (1.4 per cent) and St. John s (1.2 per cent). Year over year, the Calgary CMA recorded an increase in prices of only 6.1 per cent in August 2007. The Saskatoon CMA had the largest gain in prices for new homes in Canada on a year-over-year basis (53.6 per cent), followed by Edmonton (30.2 per cent) and Regina (29.2 per cent). Windsor was the only metropolitan area posting a decline in new housing prices (-2.8 per cent) compared to August of last year. The number of single-family metro 55 homes sold in Calgary in August 2007 totaled 1,314, a 12 per cent decrease from July 2007, and a 2 per cent decrease from August 2006. The median price 56 of a single- 53 54 Statistics Canada, Consumer Price Index, by city (monthly), CANSIM table 326-0020, September 19, 2007. Canada Mortgage and Housing Corporation, Housing Now Calgary, September 2001, p.1. Alberta Employment, Immigration and Industry 25
family metro home in Calgary was $430,000 in August 2007, a 1.2 per cent decrease from July 2007 ($435,000), and an 11.4 per cent increase from August 2006 ($386,000). The average price 57 of a singlefamily metro home in August 2007 was $485,914, up 13 per cent from the average price of $429,855 in August 2006. 58 The number of metro condo units sold in Calgary in August 2007 totaled 598, a 0.8 per cent decrease from July 2007, and a 12 per cent decrease year over year. The median price of a Calgary metro condo was $301,000 in August 2007, a 14 per cent increase from August 2006. The average price of a metro condo in Calgary in August 2007 was $320,790, up 13 per cent from the average price of $283,547 in August 2006. 59 Building Permits The total value of building permits in the Calgary CMA amounted to $4.4 billion from January to August 2007, a 29 per cent increase compared to the first eight months of 2006. In August 2007, Calgary CMA builders took out only $367 million in building permits, a 33 per cent decrease from July 2007. Non-Residential Building Construction In the third quarter of 2007, investment in non-residential building construction (industrial, commercial and institutional) rose significantly in the Calgary CMA to $1.26 billion, a 10 per cent increase from the second quarter of 2007. Office Market Of the 34 census metropolitan areas (CMAs), 23 showed gains in the third quarter, with Toronto, Calgary, and Montreal showing the largest increases (in dollars). Calgary and Montreal both set a new quarterly high. 60 As a result of a slowdown in energy sector activity due in part to low natural gas prices and increased production costs, demand for office space in Downtown Calgary cooled slightly in the first half of 2007. However, according to Colliers International, this slowdown should not be a cause of concern. Although vacancy rates have increased to 2.23% from 1.52% at the end of the first quarter (2007) and from 0.32% at the end of 2006, landlords remain in a very strong position. 61 For the remainder of 2007, Colliers International expects to see an increase in office leasing activity. The wait and see outlook that pervaded the market in the first half of the year seems to be giving way to an environment where tenants are generally more optimistic about the future. While leasing activity is forecast to increase, we expect leasing rates to remain high by historical terms. We also expect to be operating in a low vacancy environment for some time to come. 62 55 56 57 58 59 60 61 62 Calgary Real Estate Board all Calgary metro MLS statistics include properties listed and sold only within Calgary City limits. An equal number of homes are sold above and below the price. Calgary Real Estate Board average price information can be useful in establishing trends over time, but does not indicate actual prices in centres comprised of widely divergent neighbourhoods or account for price differentials between geographic areas. Calgary Real Estate Board, Residential Statistics, August 2007. Ibid. Statistics Canada, The Daily, Investment in non-residential building construction, Third quarter 2007, October 12, 2007. Colliers International, Calgary Commercial Real Estate Perspective, Q2 07, Downtown Office Market, July 2007, p.1. Ibid, p.2. Alberta Employment, Immigration and Industry 26
The following downtown office developments are anticipated as of July 2007 63 : Homburg-Harris Centre Phase 1 (210,000 sq. ft.) under construction anticipated completion Q4 2007. Homburg-Harris Centre Phase 2 (400,000 sq. ft.) under construction anticipated completion Q2 2009. Jamieson Place (820,000 sq. ft.) under construction anticipated completion Q4 2008. Centennial Place Phase 1 (760,000 sq. ft.) under construction anticipated completion Q4 2009. Palliser Square South (300,000 sq. ft.) under construction anticipated completion Q2 2009. Penny Lane Development Phase 1 (1,000,000 sq. ft.) construction to start in Q3 2007 anticipated completion Q1 2011. The Bow (Encana) (1,800,000 sq. ft.) under construction anticipated completion Q4 2011. 8 West (130,000 sq. ft.) under construction anticipated completion Q1 2008. 63 Ibid. Alberta Employment, Immigration and Industry 27
TRENDS IN THE LABOUR MARKET This section examines labour market information for Canada, Alberta, and the Calgary Region. The information provided in this section is based upon Statistics Canada s Labour Force Survey. CANADA Q3 2007 Employment in Canada was estimated at 16,881,200 in the third quarter of 2007, an increase of 70,200 from the second quarter of 2007. Year over year, employment has increased by 384,000. Table 7: Labour Force Survey Statistics - Canada Canada Jul-07 Aug-07 Sep-07 Q3 2007 Q2 2007 Quarterly Change Q3 2006 Annual Change Population 26,569,900 26,599,800 26,631,800 26,600,500 26,504,800 95,700 26,231,600 368,900 Labour Force 17,928,300 17,947,500 17,976,700 17,950,800 17,900,000 50,800 17,632,700 318,100 Employed 16,848,600 16,871,900 16,923,000 16,881,200 16,811,000 70,200 16,497,200 384,000 Unemployed 1,079,800 1,075,600 1,053,600 1,069,700 1,089,000-19,300 1,135,500-65,800 Participation Rate 67.5% 67.5% 67.5% 67.5% 67.5% 0.0% 67.2% 0.3% Employment Rate 63.4% 63.4% 63.5% 63.5% 63.4% 0.1% 62.9% 0.6% Unemployment Rate 6.0% 6.0% 5.9% 6.0% 6.1% -0.1% 6.4% -0.4% Source: Statistics Canada, Labour Force Survey, seasonally adjusted Figure 5: Employment in Canada Alberta Employment, Immigration and Industry 28
The seasonally adjusted unemployment rate in the third quarter of 2007 decreased to 6.0 per cent, down from 6.1 per cent in the second quarter of 2007, and 6.4 per cent in the third quarter of 2006. In September 2007, the unemployment rate in Canada fell to 5.9 per cent. This was the first time that the unemployment rate has been below 6.0 per cent since November 1974. Figure 6: Unemployment Rate in Canada Employment by Type of Work, Gender and Age On a quarter over quarter basis, the employment gain in the third quarter of 2007 was entirely a result of an increase in full-time work. On a year over year basis, however, part-time employment increased 3 per cent in the third quarter of 2007, while full-time employment increased 2 per cent. Women accounted for 57 per cent of the employment increase in the third quarter of 2007 (39,700) compared to the second quarter of 2007. Year over year, employment growth for women (2.7 per cent) exceeded that for men (2.0 per cent) in the third quarter of 2007. In the third quarter of 2007, employment growth for adults (0.5 per cent) was slightly higher than that of youth aged 15 24 (0.2 per cent) compared to the previous quarter, as a result of a slight decline in youth employment in September 2007. In September, employment among 15- to 24-year-olds edged down slightly as a decline of 31,000 youths working full time was partly offset by an increase of 20,000 working part time. 64 64 The Daily, Labour Force Survey September 2007, October 5, 2007, p.3. Alberta Employment, Immigration and Industry 29
On a year over year basis, however, employment growth for youth aged 15 24 (2.9 per cent) was higher than that of adults (2.2 per cent) in the third quarter of 2007. Table 8: Employment in Canada by Type of Work, Gender and Age Canada Jul-07 Aug-07 Sep-07 Q3 2007 Q2 2007 Quarterly Change Q3 2006 Annual Change Employment 16,848,600 16,871,900 16,923,000 16,881,200 16,811,000 70,200 16,497,200 384,000 Full-time 13,824,200 13,830,700 13,863,200 13,839,400 13,751,900 87,500 13,542,400 297,000 Part-time 3,024,400 3,041,200 3,059,900 3,041,800 3,059,100-17,300 2,954,800 87,000 Men 8,884,300 8,884,200 8,905,800 8,891,400 8,861,100 30,300 8,720,400 171,000 Women 7,964,300 7,987,600 8,017,300 7,989,700 7,950,000 39,700 7,776,800 212,900 15-24 years 2,603,300 2,593,800 2,582,500 2,593,200 2,587,100 6,100 2,521,400 71,800 25 years + 14,245,200 14,278,100 14,340,500 14,287,900 14,223,900 64,000 13,975,800 312,100 Source: Statistics Canada, Labour Force Survey, seasonally adjusted Employment by Industry Strong employment growth occurred year over year in the third quarter of 2007 in a number of industries including utilities (17.9 per cent), construction (7.4 per cent), accommodation and food services (5.5 per cent), and professional, scientific and technical services (5.2 per cent). Employment declines, on a year over year basis, were experienced in manufacturing (- 2.7 per cent) and agriculture (-2.0 per cent). Table 9: Employment in Canada by Industry Canada Q3 2007 Q2 2007 Quarterly Change Q3 2006 Annual Change All Industries 16,881,200 16,811,000 70,200 16,497,200 384,000 Agriculture 339,800 329,000 10,800 346,600-6,800 Natural resources 331,300 345,300-14,000 329,800 1,500 Utilities 145,800 135,300 10,500 123,700 22,100 Construction 1,144,100 1,128,000 16,100 1,065,200 78,900 Manufacturing 2,038,300 2,046,700-8,400 2,095,200-56,900 Trade 2,700,800 2,682,400 18,400 2,633,300 67,500 Transportation & warehousing 814,800 821,900-7,100 791,400 23,400 Finance, insurance, real estate and leasing 1,055,100 1,061,300-6,200 1,040,000 15,100 Professional, scientific & technical services 1,152,800 1,118,400 34,400 1,095,600 57,200 Business, building & other support services 711,300 690,200 21,100 696,500 14,800 Educational services 1,168,700 1,186,700-18,000 1,154,200 14,500 Health care and social assistance 1,837,800 1,842,700-4,900 1,804,200 33,600 Information, culture & recreation 782,500 784,600-2,100 753,000 29,500 Accommodation & food services 1,077,700 1,077,000 700 1,021,700 56,000 Other services 713,700 713,500 200 705,200 8,500 Public administration 866,600 847,900 18,700 841,600 25,000 Source: Statistics Canada, Labour Force Survey, seasonally adjusted Alberta Employment, Immigration and Industry 30
ALBERTA Q3 2007 Employment in Alberta in the third quarter of 2007 increased by 20,600 from the second quarter of 2007, and by 94,500 year over year. Alberta accounted for approximately 30 per cent of the employment gain in Canada in the third quarter of 2007, compared to the previous quarter. Alberta s seasonally adjusted unemployment rate decreased to 3.5 per cent in the third quarter of 2007, down from 3.7 per cent in the second quarter of 2007, and 3.8 per cent in the third quarter of 2006. In July and August 2007, Alberta was the only province with an unemployment rate below 4.0 per cent. Table 10: Labour Force Statistics - Alberta Alberta Jul-07 Aug-07 Sep-07 Q3 2007 Q2 2007 Quarterly Change Q3 2006 Annual Change Population 2,748,800 2,754,500 2,759,900 2,754,400 2,732,300 22,100 2,651,600 102,800 Labour Force 2,037,000 2,040,800 2,046,200 2,041,300 2,023,700 17,600 1,948,900 92,400 Employed 1,968,900 1,968,700 1,973,300 1,970,300 1,949,700 20,600 1,875,800 94,500 Unemployed 68,100 72,000 72,900 71,000 74,000-3,000 73,200-2,200 Participation Rate 74.1% 74.1% 74.1% 74.1% 74.1% 0.0% 73.5% 0.6% Employment Rate 71.6% 71.5% 71.5% 71.5% 71.4% 0.1% 70.7% 0.8% Unemployment Rate 3.3% 3.5% 3.6% 3.5% 3.7% -0.2% 3.8% -0.3% Source: Statistics Canada, Labour Force Survey, seasonally adjusted Figure 7: Unemployment Rates Q3 2007 (Canada and Provinces) Source: Statistics Canada, Labour Force Survey, seasonally adjusted Alberta Employment, Immigration and Industry 31
Employment by Type of Work, Gender and Age On a year over year basis, there were increases in both full-time and part-time employment in the third quarter of 2007, with full-time employment accounting for 90 per cent of the total employment gain. Employment growth for women (5.3 per cent) exceeded that for men (4.6 per cent), while employment growth for adults aged 25 to 64 (5.2 per cent) exceeded that for youth aged 15 to 24 (3.6 per cent). Employment among adults aged 65 and over increased 6.3 per cent from the same period a year ago. Table 11: Employment in Alberta by Type of Work, Gender, and Age (unadjusted) Alberta Jul-07 Aug-07 Sep-07 Q3 2007 Q3 2006 Annual Change Employment 2,000,400 1,995,000 1,974,000 1,989,800 1,896,700 93,100 Full-time 1,733,300 1,734,800 1,664,700 1,710,900 1,627,500 83,400 Part-time 267,200 260,200 309,300 278,900 269,200 9,700 Men 1,105,400 1,106,800 1,084,900 1,099,000 1,050,800 48,200 Women 895,000 888,200 889,100 890,800 845,900 44,900 15-24 years 380,600 374,200 327,500 360,800 348,400 12,400 25-64 years 1,578,000 1,577,400 1,599,400 1,584,900 1,506,900 78,000 65 years + 41,800 43,400 47,100 44,100 41,500 2,600 Source: Alberta Employment, Immigration and Industry, Labour Force Statistics, Alberta Employment by Industry On a year over year basis, there was strong employment growth in the third quarter of 2007 in a number of industries in Alberta including wholesale trade (26.4 per cent), utilities (17.4 per cent), business, building and other support services (17.2 per cent), and construction (13.9 per cent). Employment declined in educational services (-4.0 per cent), transportation and warehousing (-2.8 per cent), public administration (-2.6 per cent), accommodation and food services (-1.0 per cent) and retail trade (-0.8 per cent). Alberta Employment, Immigration and Industry 32
Table 12: Employment in Alberta by Industry (unadjusted) Alberta Jul-07 Aug-07 Sep-07 Q3 2007 Q3 2006 Annual Change All Industries 2,000,400 1,995,000 1,974,000 1,989,800 1,896,700 93,100 Agriculture 51,200 54,900 60,700 55,600 53,400 2,200 Forestry and logging with support activities 4,900 6,000 3,700 4,900 4,300 600 Mining and oil and gas extraction 148,500 152,300 150,700 150,500 138,400 12,100 Utilities 21,400 21,500 19,900 20,900 17,800 3,100 Construction 207,400 208,300 197,900 204,500 179,600 24,900 Manufacturing 138,000 144,300 138,400 140,200 138,800 1,400 Wholesale trade 83,700 89,200 85,800 86,200 68,200 18,000 Retail trade 219,700 206,600 206,400 210,900 212,700-1,800 Transportation & warehousing 108,000 98,300 106,500 104,300 107,300-3,000 Finance, insurance, real estate and leasing 100,300 97,500 100,900 99,600 93,800 5,800 Professional, scientific & technical services 147,300 148,200 140,300 145,300 144,500 800 Business, building & other support services 81,300 80,300 75,200 78,900 67,300 11,600 Educational services 108,600 109,100 118,400 112,000 116,700-4,700 Health care and social assistance 195,000 201,700 193,700 196,800 185,500 11,300 Information, culture & recreation 85,100 77,500 80,700 81,100 74,200 6,900 Accommodation & food services 120,600 118,600 112,300 117,200 118,400-1,200 Other services 97,100 95,800 97,500 96,800 89,600 7,200 Public administration 82,300 84,700 84,900 84,000 86,200-2,200 Source: Alberta Employment, Immigration and Industry, Labour Force Statistics, Alberta Employment by Occupation In the third quarter of 2007, there was significant year over year employment growth across a number of occupations. The most significant increases occurred in art, culture, recreation and sport (38.2 per cent), trades, transport and equipment operators and related occupations (10.0 per cent), business, finance and administrative occupations (8.3 per cent), and natural and applied sciences and related occupations (8.1 per cent). Employment dropped in occupations unique to processing, manufacturing and utilities (-6.6 per cent), social science, education, government and religion (-3.1 per cent), and management (-2.8 per cent). Table 13: Employment in Alberta by Occupation (unadjusted) Alberta Jul-07 Aug-07 Sep-07 Q3 2007 Q3 2006 Annual Change All Occupations 2,000,400 1,995,000 1,974,000 1,989,800 1,896,700 93,100 Management 155,000 152,200 161,700 156,300 160,800-4,500 Business, finance and administrative 359,300 361,700 361,800 360,900 333,100 27,800 Natural & applied sciences & related 156,000 157,100 157,900 157,000 145,300 11,700 Health 103,300 112,500 113,100 109,600 107,700 1,900 Social science, education, government & religion 133,900 132,700 134,700 133,800 138,100-4,300 Art, culture, recreation & sport 56,900 55,800 52,300 55,000 39,800 15,200 Sales & service 456,100 430,200 423,300 436,500 429,200 7,300 Trades, transport & equipment operators & related 381,100 386,700 374,000 380,600 345,900 34,700 Unique to primary industry 124,400 133,300 127,600 128,400 120,100 8,300 Unique to processing, manufacturing & utilities 74,300 72,800 67,600 71,600 76,700-5,100 Source: Alberta Employment, Immigration and Industry, Labour Force Statistics, Alberta Alberta Employment, Immigration and Industry 33
CALGARY CENSUS METROPOLITAN AREA (CMA) Q3 2007 Total employment in the Calgary CMA in the third quarter of 2007 increased by 10,100 from the second quarter of 2007, and by 32,600 year over year. Employment gains in the Calgary CMA in the third quarter of 2007, on a year over year basis, accounted for 35 per cent of the increase in provincial employment. The unemployment rate in the Calgary CMA decreased to 3.3 per cent in the third quarter of 2007, down from 3.5 per cent in the second quarter of 2007, and 3.6 per cent in the third quarter of 2006. The Calgary CMA had the lowest unemployment rate among metropolitan areas in September 2007 at 3.1 per cent, followed by Vancouver (3.7 per cent), and Victoria (3.8 per cent). Windsor had the highest unemployment rate among metropolitan areas at 9.9 per cent in September 2007. Table 14: Labour Force Statistics - Calgary CMA Calgary CMA Jul-07 Aug-07 Sep-07 Q3 2007 Q2 2007 Quarterly Change Q3 2006 Annual Change Population 923,400 926,300 929,000 926,200 917,400 8,800 888,000 38,200 Labour Force 706,800 710,300 708,900 708,700 699,900 8,800 677,400 31,300 Employed 682,600 687,100 686,900 685,500 675,400 10,100 652,900 32,600 Unemployed 24,200 23,200 22,000 23,100 24,400-1,300 24,400-1,300 Participation Rate 76.5% 76.7% 76.3% 76.5% 76.3% 0.2% 76.3% 0.2% Employment Rate 73.9% 74.2% 73.9% 74.0% 73.6% 0.4% 73.5% 0.5% Unemployment Rate 3.4% 3.3% 3.1% 3.3% 3.5% -0.2% 3.6% -0.3% Source: Statistics Canada, Labour Force Survey, seasonally adjusted (3 month moving average) Figure 8: Unemployment Rates of Canadian Cities (CMAs) September 2007 Alberta Employment, Immigration and Industry 34
COMMUNITY PROFILES This section provides a detailed profile of the Towns of Turner Valley and Black Diamond and highlights some of the happenings in the third quarter of 2007 in the communities surrounding Calgary. TOWNS OF TURNER VALLEY AND BLACK DIAMOND Turner Valley is located 60 km southwest of Calgary along Highway #22. Black Diamond, Turner Valley s sister town, is located 3 km east of Turner Valley. Both towns are located in the Municipal District of Foothills No. 31 along with the towns of High River and Okotoks. Turner Valley is the birthplace of Alberta s oil and gas industry. On October 15, 2007, Turner Valley and Black Diamond residents will have the opportunity to vote on whether to amalgamate their towns, creating one municipality and uniting their administration. In June 2007, an online survey of just over 60 locals found 55 per cent were in favour of the amalgamation, while 40 per cent were not in favour. Turner Valley and Black Diamond would remain distinct and separate towns within one municipality should locals vote to merge, and Diamond Valley is one of the names that has been suggested for the new municipality. 65 Both town councils began discussing the possibility of amalgamation in late 2005 as a way to reduce administrative duplication. In June 2007, Austrom Consulting Ltd. presented an amalgamation study to the councils of Turner Valley and Black Diamond outlining the pros and cons of amalgamation, and the potential impacts, including impacts on staffing, community services, taxation, and transportation. The report identified several benefits that could come from the amalgamation of the towns including a stronger unified voice when negotiating with the Provincial and Federal governments, industry, and neighbouring municipalities; economies of scale, efficiencies and improvements in the services provided; and improved marketing of the business and commercial opportunities of the municipality. 66 POPULATION In 2006, the Municipal District of Foothills No. 31 had a population of approximately 19,700, a 19 per cent increase from 2001. The municipal district has a land area of 3,644 square kilometers and a population density of 5.4 per square kilometre. Although the towns of Turner Valley and Black Diamond both have a population of approximately 1,900 each, Turner Valley has grown at a much faster rate than Black Diamond since 2001. Turner Valley s population has grown almost 19 per cent from 2001 to 2006, while Black Diamond s population has grown 2 per cent over the same time period. On average, the populations of Turner Valley and Black Diamond are older when compared to the Calgary CMA and Alberta. According to the 2006 federal census, the median age of residents in Turner Valley was 41.7 years, while the median age of residents in Black Diamond was 42.6 years. This compares to a median age of 35.7 in the Calgary CMA and 36.0 in Alberta. Black Diamond has a higher proportion of people aged 65 years and over (17 per cent) when compared to Turner Valley (11 per cent). According to the 2001 federal census, 61 per cent of Turner Valley s population and 59 per cent of Black Diamond s population aged 20 and over have some post-secondary education. In comparison, 69 per cent of Calgary s population aged 20 and over has some post-secondary education with 24 per cent holding a university degree. 65 Calgary Herald, Black Diamond, Turner Valley to vote on merger, Paula Beauchamp, August 4, 2007. 66 Austrom Consulting Ltd., Town of Black Diamond and Town of Turner Valley Amalgamation Study, June 2007. Alberta Employment, Immigration and Industry 35
Forty-three per cent of the population in Black Diamond with post-secondary qualifications have qualifications in engineering and applied science technologies and trades. Fifteen per cent have qualifications in commerce, management and business administration and an additional 15 per cent are health professionals. In comparison, 26 per cent of the population in Turner Valley with post-secondary qualifications have qualifications in engineering and applied science technologies and trades, 16 per cent have qualifications in commerce, management and business administration, and 13 per cent are educated in the social sciences and related fields. Table 15: Towns of Turner Valley and Black Diamond Population and Education Statistics Statistic Turner Valley Black Diamond Description Population 1,908 1,900 2006 federal census 1,608 1,866 2001 federal census 18.7% 1.8% % change Age Distribution 18.4% 16.8% 0-14 years 2006 federal census 11.8% 11.6% 15-24 years 26.2% 25.3% 25-44 years 32.3% 29.7% 45-64 years 11.0% 16.8% 65 years+ 41.7 42.6 Median age 81.4 83.2 % of population aged 15+ Gender Distribution 49.9% 48.7% Male 2006 federal census 50.1% 51.3% Female Education 24.0% 30.2% No high school cert. 2001 federal census 15.0% 11.3% High school cert. Highest level attained (20 yrs. and older) 36.1% 37.1% Trades or non-university cert./dipl. 13.3% 14.1% Post-secondary (not completed) 1.3% 0.8% University dipl./cert. 10.7% 6.9% University degree 61.4% 58.9% % of pop. aged 20+ with some post-secondary Post-secondary Qualifications 8.1% 2.7% Agriculture & biological sciences 2001 federal census 16.2% 15.2% Commerce, management & bus. admin. 5.4% 7.1% Education, recreation & counseling services 26.1% 42.9% Engineering & applied science tech. & trades 6.3% 3.6% Engineering & applied sciences 9.0% 4.5% Fine & applied arts 9.9% 15.2% Health professionals, science & technologies 1.8% 3.6% Humanities & related fields 1.8% 1.8% Mathematics & physical sciences 12.6% 4.5% Social sciences & related fields Alberta Employment, Immigration and Industry 36
EMPLOYMENT According to the 2001 federal census, the majority of the workforces in both Turner Valley and Black Diamond were employed in the business and community services, retail and wholesale, and construction industries. In terms of employment by occupation, 64 per cent of Turner Valley s workforce and 69 per cent of Black Diamond s workforce were employed in trades, transport and equipment operator occupations, sales and service occupations, and business, finance and administrative occupations. Table 16: Towns of Turner Valley and Black Diamond Employment Statistics Statistic Turner Valley Black Diamond Description Employment by Industry 40.8% 38.0% Business & Community Services 2001 federal census 11.5% 16.4% Retail & Wholesale 10.9% 14.9% Construction 9.8% 9.7% Transportation & Utilities 8.6% 9.2% Manufacturing 6.3% 4.6% Mining 5.8% 2.6% Public Administration 5.8% 2.6% Agriculture 1.2% 3.1% Finance Employment by Occupation 23.7% 28.4% Trades, Transport & Equip Operators 2001 federal census 22.5% 29.4% Sales & Service 17.9% 11.3% Business, Finance & Administrative 6.9% 6.7% Natural & Applied Sciences 6.9% 5.7% Unique to Primary Industry 5.8% 7.7% Management 5.2% 3.6% Processing, Manufacturing & Utilities 4.6% 3.1% Social Science, Education, Gov, Religion 3.5% 3.6% Health 3.5% 1.0% Art, Culture, Recreation & Sport 1.2% 1.0% Not Classified Alberta Employment, Immigration and Industry 37
OTHER COMMUNITIES IN THE CALGARY REGION Alberta Employment, Immigration and Industry s Calgary Region includes the following communities surrounding the City of Calgary: Airdrie, Banff, Beiseker, Black Diamond, Canmore, Chestermere, Cochrane, Crossfield, High River, Irricana, Okotoks, and Turner Valley. This section highlights current information on housing, capital projects and noteworthy news items for each of these communities, where available. HOUSING Total housing starts in the Calgary CMA decreased in the first eight months of 2007 to a total of 9,418 units, a 21.5 per cent decline from the same period in 2006. Single-detached starts totaled 5,417 units year to date in August 2007, a 27 per cent decline from the same period in 2006, while multi-family starts totaled 4,001, a 12 per cent decrease from the first eight months of 2006. Single-detached starts last August were the highest on record for any August, so any comparison to this month will likely show a decrease. There are also a lot of single-family homes for sale in the resale market and this is competing with new home sales. 67 Although single-detached starts have declined year over year in the first eight months of 2007 in the Calgary CMA as a whole, single-detached starts in Cochrane and the MD of Rockyview have increased. 68 The MD of Rockyview was the only area in the Calgary CMA that experienced a year over year increase in total housing starts in the first eight months of 2007. Table 17: Housing Starts in the Calgary CMA - January to August Single Multiple Total % Change Area 2007 2006 2007 2006 2007 2006 2007/2006 Airdrie 562 669 362 478 924 1,147-19.4% Beiseker 1 1 0 0 1 1 0.0% Calgary City 4,177 6,028 3,551 3,852 7,728 9,880-21.8% Chestermere Lake 178 417 40 93 218 510-57.3% Cochrane 158 105 18 98 176 203-13.3% Crossfield 16 29 0 20 16 49-67.3% Irricana 4 8 4 4 8 12-33.3% MD Rockyview 321 193 26 6 347 199 74.4% Total 5,417 7,450 4,001 4,551 9,418 12,001-21.5% Source: Canada Mortgage and Housing Corporation 67 68 Canada Mortgage and Housing Corporation, Housing Now Calgary, September 2007, p.2. Ibid. Alberta Employment, Immigration and Industry 38
The total number of resale housing units sold in the towns outside Calgary 69 in September 2007 totaled 363, a 10.4 per cent decrease from September 2006. From January to September 2007, 4,407 resale housing units were sold, representing a 2.8 per cent increase from the same period in 2006. Average combined residential sale prices in the towns outside Calgary increased 23.7 per cent in September 2007 to $400,938, compared to September 2006. From January to September 2007, average residential sale prices in the towns increased 29.8 per cent compared to the first nine months of 2006. Table 18: Total Housing Sales, Average Sale Price, and Median Sale Price for Towns (outside Calgary) Towns (outside Calgary) September 2007 September 2006 % Change Jan - Sep 2007 Jan - Sep 2006 % Change Sales 363 405-10.4% 4,407 4,285 2.8% Avg. Sale Price $ 400,938 $ 324,215 23.7% $ 373,641 $ 287,866 29.8% Median Sale Price $ 370,000 $ 302,000 22.5% $ 346,000 $ 261,500 32.3% Source: Calgary Real Estate Board Table 19: Total Housing Sales, Average Sale Price, and Median Sale Price by Area for Q3 2007 Area Sales (#) Avg. Sale Price ($) Median Sale Price ($) Airdrie 299 361,375 363,000 Banff 3 751,333 760,000 Beiseker 2 222,500 146,000 Black Diamond 14 251,550 246,000 Canmore 83 716,325 619,000 Chestermere 78 517,837 480,000 Cochrane 116 428,473 419,900 Crossfield 25 310,150 316,000 High River 120 308,976 310,000 Irricana 12 288,079 273,250 Okotoks 156 393,021 395,000 Turner Valley 15 351,960 320,000 Source: Calgary Real Estate Board 69 See www.creb.com for a list of towns. Alberta Employment, Immigration and Industry 39
INVENTORY OF PROJECTS Alberta Employment, Immigration and Industry estimates that over $2.61 billion in major capital projects are either proposed (P), announced (A), or under construction (UC) in select communities surrounding Calgary. Location Table 20: Summary - Inventory of Major Projects in Select Communities (> $5 million) Total Projects Proposed Announced Under Construction Cost ($mill) Airdrie 8 4 3 1 90.0 Banff 6 2 1 3 300.8 Beiseker 1 1 7.0 Canmore 4 1 1 2 452.7 Chestermere 2 1 1 23.9 Cochrane 5 5 195.4 Crossfield 1 1 5.0 High River 2 2 22.7 Okotoks 3 2 1 24.4 Turner Valley 1 1 6.0 MD of Foothills 10 3 2 5 464.0 MD of Rocky View 17 8 2 7 1024.8 Total 60 30 10 20 2,616.7 Source: Alberta Employment, Immigration and Industry, Inventory of Alberta Major Projects, Aug 2007 Alberta Employment, Immigration and Industry 40
Table 21: Inventory of Major Projects in Select Communities (> $5 million) Area Company Project Cost ($mill) AIRDRIE City of Airdrie East Lake Aquatic and Fitness Centre - phase 2 22.0 A FortisAlberta Office building 20.0 UC Wal-Mart Canada Ltd. Store expansion 5.0 P Integrated Life Care Inc. Luxstone Manor' supported living units 5.4 P City of Airdrie Sanitary Force Main - Airdrie to Calgary 8.0 A Alberta Infrastructure and Transportation New Elementary School (K to grade 6) 14.5 P Home Depot New store 10.0 A Sustainable Housing Working Group Affordable housing project 5.1 P Sub Total 90.0 BANFF Public Works and Government Services Canada New Bow River CPR overpass bridge 8.0 A Town of Banff Joint recreation and community centre 34.0 P Town of Banff Downtown parkade 10.0 P Banff National Park Twinning a section of Highway 1 94.0 UC Town of Banff Infrastructure and streetscape improvements 22.8 UC The Banff Centre Campus redevelopment plan 132.0 UC Sub Total 300.8 BEISEKER Alberta 2005 Centennial Railway Museum Society Railway Museum 7.0 UC Sub Total 7.0 CANMORE Alberta Infrastructure and Transportation Joint English and French School (K to grade 12) 20.0 A Alberta Infrastructure and Transportation Replacement School - Lawrence Grassi Middle School 12.7 UC Destination Resorts Inc. Three Sisters Resort 150.0 UC Stone Creek Properties Silver Tip Hotel/Resort Village 270.0 P Sub Total 452.7 CHESTERMERE Alberta Infrastructure and Transportation New elementary school (K to grade 6) 14.5 P Alberta Infrastructure and Transportation New elementary school (K to grade 6) 9.4 A Sub Total 23.9 CROSSFIELD Kirollos Development 'The Arches' mixed use building 5.0 P Sub Total 5.0 COCHRANE Springwood Development Commercial development 75.0 P Calgary Health Region Community health centre 6.0 P Town of Cochrane New water treatment plant - phase 1 23.4 P Inter Pipeline Fund Ethane recovery project 80.0 P Spray Lake Sawmill Recreation Park Society Phase 3 of sports centre development 11.0 P Sub Total 195.4 HIGH RIVER Town of High River Library expansion 16.7 P Continuum Health Care Supportive housing complex 6.0 P Sub Total 22.7 OKOTOKS Calvanna Developments Calvanna Village phase 3 12.0 P Alberta Infrastructure and Transportation Modernization Percy Pegler School 6.9 P Town of Okotoks Redevelopment of Scotia Bank building into new town hall 5.5 UC Sub Total 24.4 TURNER VALLEY Turner Valley Legion Community Centre 6.0 P Sub Total 6.0 MD FOOTHILLS MD of Foothills/City of Calgary Pine Creek Wastewater Treatment Plant 375.0 UC Alberta Infrastructure and Transportation Highway 2/SH 547 interchange 26.1 UC Alberta Infrastructure and Transportation Highway 2 pave, intersection improvement 5.6 UC Alberta Infrastructure and Transportation Highway 2 interchange conversion at CPR overpass 7.0 P MD of Foothills Joint facility for fire and EMS services 7.0 P MD of Foothills SH 773 upgrades 5.6 A Western Biodiesel Inc. Bio-diesel processing facility 7.5 A MD of Foothills SH 540 paving and improvements 10.1 P Alberta Infrastructure and Transportation New school (K to 9) Red Deer Lake Community School 11.8 UC Foothills Foundation Supportive living facility 8.3 UC Sub Total 464.0 MD ROCKY VIEW MD of Rocky View Recreation facility Bow North Recreation District- Langdon 20.0 P Tsuu T'ina Nation Grey Eagle Casino 40.0 UC Alberta Infrastructure and Transportation Highway 2 & 2A grade, base and pave 30.0 P Alberta Infrastructure and Transportation SH 560 grade, base and pave 8.0 P Alberta Infrastructure and Transportation Highway 8 grade, base and pave 8.0 UC Alberta Infrastructure and Transportation Highway 8/22 intersection improvements 6.5 UC Alberta Infrastructure and Transportation Highway 1 interchange at JCT HWY 9 and SH 797 40.0 UC Calgary Airport Authority Canadian Centre for Aircraft Certification 11.0 A MD of Rocky View East Rocky View wastewater transmission line upgrades 11.0 P MD of Rocky View Langdon regional wastewater treatment plant 23.0 P MD of Rocky View Langdon water treatment plant upgrades and pipeline 70.0 P United Horsemen of Alberta Calgary Race Track & Racing Entertainment Centre 200.0 UC Avenue Commercial Development Development of Wagon Wheel Industrial Park 50.0 UC Ivanhoe Cambridge CrossIron Mills regional shopping centre 434.0 UC Edge School New school campus 30.0 P Town of Bragg Creek Water and wastewater treatment facility 26.0 P EnCharis Community Housing and Services 'Prince of Peace' dementia and assisted living care 17.3 A Sub Total 1,024.8 TOTAL 2,616.7 Status Alberta Employment, Immigration and Industry 41
COMMUNITY NEWS Canmore attracts buyers Calgary Herald, July 21, 2007 The price of housing in Canmore continues to surge as buyers pick up recreational property in the mountain landscape. The cost of housing rose by about 22 per cent this last year according to numbers from Century 21, and the starting price for a single family home is now about $650,000 which buys an older home or a small new home. More commonly, homes are now priced in seven digits. All work, all play Calgary Herald, July 26, 2007 The summer months are the busy months for restaurants in the Bow Valley and the labour crunch has only increased the pressures on business owners. But at least one entrepreneur thinks he s found a solution. Terry Jensen a restaurant owner in the Bow Valley is running a summer camp for teens from Quebec. The camp is a mixture of work and vacation, plus a large dose of language learning as teens immerse themselves in an English environment. The one limit on the program according to Jensen is a lack of housing, but the 15 students helped fully staff Jensen s restaurants. In the meantime, the students have been enjoying summer visiting Calgary s Stampede and the Columbia Icefields. Age creeps up on High River High River Times, July 31, 2007 The latest numbers from Statistics Canada show High River s population is rising and getting a little older at the same time. The overall population of High River grew by 14.7 per cent between 2001 and 2006, while the senior population grew by 20 per cent. The numbers may be partly explained by High River s attraction as a retirement destination, with a local hospital and mix of high and low cost housing. Cochrane approved for 700 new lots Cochrane Eagle, August 1, 2007 The town of Cochrane is going full steam ahead with the development of 700 new homes, which were approved this year. New lots have been approved in the communities of Sunset Ridge, South Ridge, Heritage Hills and West Point. The town has approved the homes in response to double-digit growth in the past few years in fact, it has grown by 14.3 per cent since 2001 and since the early 1970s, it has averaged an eight per cent growth rate. It is predicted the growth will continue to be steady. Province annexes land Calgary Sun, August 1, 2007 Calgary s boundaries grew by even more as the Alberta government approved an annexation between the City of Calgary and the Municipal District of Rocky View. The new agreement will add 103 sq. km to the city s boundaries and 600 more residents who currently reside in the annexed land. This will give the city an additional 14 years of residential land, and up the total of industrial lands to a 32-year build out in the southeast corridor. First employment agency enters Airdrie Airdrie Echo, August 1, 2007 A new employment agency in Airdrie will now help people looking for jobs. International Staffing Consulting Services (ISCS) opened its doors on Main Street in April. ISCS helps employers find permanent, temporary and international placements in industries such as construction, administration, manufacturing and warehousing. Airdrie is growing and we know there s going to be lots of opportunities for people to look at different jobs, said one owner of the employment agency. A lot of people live here, but don t know there are jobs here. Those aged 16 and over looking for work can simply walk into the ICSC office at 126 Main Street Alberta Employment, Immigration and Industry 42
and fill out an application. The agency also offers prospective employees some basic health and safety training. Low rents needed in High River High River Times, August 7, 2007 Social planners in High River are alarmed over the number of people walking into Family and Community and Support Services unable to find a rental suite. Officials say the Town of High River could be on the verge of a homelessness problem without new supplies of affordable rental properties, a concern reflected in a United Way survey that found affordable housing to be a top-priority social issue. Airdrie transit to upgrade Airdrie Echo, August 8, 2007 The future of Airdrie's transit system may be considerably different than the past if plans to link into Calgary s LRT system can be made to work. Airdrie mayor Linda Bruce says an LRT link with Calgary probably won t happen in ten years, but could be a possibility in the next 20. One obstacle to linking the cities is funding. The City of Calgary is expecting Airdrie to contribute towards a project that would cost $25 million for every kilometre of track. In the short term, Airdrie officials are looking at plans to start a bus, or shuttle service to Calgary in an effort to alleviate traffic congestion caused by growth. Patients flock to country Calgary Herald, August 11, 2007 Patients in Calgary are hitting the road more often in search of care outside the city s cramped health system. Medical centres in places like Canmore say they are seeing more and more Calgary patients willing to drive an hour to get faster treatment in small towns. For many, the trip is better than waiting six or eight hours in an urban health centre, and often patients don t have family doctors in Calgary or they can t get an appointment. Most facilities outside Calgary are feeling the same pressures as the Calgary Health Region. Many rural medical centres, with the exception of Canmore and Banff, are closing the door to new patients because of doctor shortages. To alleviate some of the pressure, hard-pressed areas can apply for under serviced status which allows clinics to hire international graduates. Canmore dodges the doctor shortage Canmore Leader, August 15, 2007 Bow Valley patients are a rare breed in Alberta. Unlike nearly every other region, the Bow Valley has plenty of doctors. Currently the Canmore Hospital has 64 physicians available on call a high number for a community the size of Canmore. A mountain lifestyle may be attracting doctors to the region, but there is a shortage of temporary and part-time nurses in Canmore. In Calgary, about 250,000 residents do not have a family doctor. Canmore a manly town Canmore Leader, August 15, 2007 According to the Town of Canmore 2006 census, 49 per cent of the population were men and 47 per cent were female, while four per cent were unknown. The largest group of men were found in the 25-34 age group. This has resulted in more men than women seeking employment in the general labour and construction industry, in which the town has an abundance of employment opportunities, according to a local staffing service. New campaign to attract workers The Banff Crag & Canyon, August 21, 2007 Banff and Lake Louise hotels are now promoting the area as opposed to jobs as a new way to attract employees. The new campaign, which launched August 21, encourages people to enjoy the surroundings by Alberta Employment, Immigration and Industry 43
living in the area. Ads promoting the travel hot spots will appear in publications throughout the country and in certain international locations where people can obtain work visas. It s about selling a destination, said a spokesperson for the Banff Hotel & Motel Association. Clearly it s about trying to put the location on the map and no one else is doing this as a resort destination. Banff hits over 8,700 The Banff Crag & Canyon, August 21, 2007 The population of Banff has hit over 8,700, according to the latest municipal census. This number differs greatly from the 6,700 reported in the 2006 federal census which showed a sharp decline in residents. The federal numbers determine grant figures for upper levels of government, which would have resulted in a huge funding loss to Banff. Of the 8,770 recorded residents, 1,196 are non-permanent. Targeting youth Cochrane Times, August 22, 2007 The Service Canada Centre for Youth (SCCY) has been targeting rural youth for summer employment. The organization went out to rural areas and handed out job order forms to employers during their hire a student week. Time spent at local high schools also provided feedback on what students were looking for. There s a lot of jobs but not much supply, said one youth service officer for SSCY. So the average wage fluctuated around $12 to $15 an hour this year. That is the highest that we ve ever experienced. It s actually about a 10 per cent increase from last year. The Calgary youth centre posted approximately 13,000 job vacancies, including those in the Cochrane area. Stoney Nakoda Resort hunts for hundreds of new workers Banff Crag and Canyon, September 4, 2007 The Nakoda Resort and Casino is hunting for 240 new staff as it gears up to open the casino portion of the resort in January 2008. So far the Stoney Tribal administration has 175 résumés on hand after it held a job fair in the Morley gym. The Stoney Nation will be conducting a pre-employment program and then stream candidates into various jobs such as servers, dealers and security personnel. Once the hotel opens in the summer of 2008, the total workforce for the resort could hit 300. Returning students leave business shorthanded Western Wheel, September 5, 2007 With students returning to classrooms, local business owners are scrambling to maintain service levels in the face of the labour shortage. The summer holidays helped ease the labour crunch for employers as students turned their attention to making some extra cash. With the first school bell of fall, students cutback on work, or quit entirely. To compensate restaurants such as the MacDonald s in Okotoks are shutting down services or closing earlier. Some operations are even looking internationally to find staff, and many are increasing wages and benefits to compete for workers. Mountain towns lure workers Banff Crag and Canyon, September 11, 2007 A media campaign to attract accommodation workers to Banff and Lake Louise is being extended after a successful initial run. The Banff Lake Louise Hotel Motel Association ran ads in weekly newspapers across the country to attract workers. The campaign, dubbed Celebrate Life. Working. promoted the region as a great place to live with plentiful relocation options. It was targeted mainly at eastern Canada and directed job hunters to a website with information on jobs and local accommodation. Alberta Employment, Immigration and Industry 44
INDUSTRY PROFILES In the third quarter of 2007, a survey was conducted of Calgary and area businesses from the following industries: Offices of Physicians, Dentists, and Other Health Practitioners (NAICS 70 6211/6212/6213) Personal Care Services (NAICS 8121) Accounting, Tax Preparation, Bookkeeping and Payroll Services (NAICS 5412) The purpose of the survey was to gain a better understanding of current hiring issues and future hiring projections, assess if Calgary and area employers were experiencing any hiring challenges in these industries, and obtain insight on current hiring practices including training and retention strategies. It should be noted that results are presented as received, with no statistical analysis. Companies were asked about past hiring and future hiring plans, difficulties experienced hiring employees with adequate skills, occupations they were having the most difficulty hiring and the reasons, resources used to hire employees, skills or competencies they were having difficulty finding, current training programs, and retention strategies. Companies were also asked if they had any comments on recruitment and retention, including any suggestions on future trends and solutions. For additional information on survey methodology, including the survey sample and survey process, see Appendix A Survey Methodology. Industry profiles are based on the results of this primary research and supplemented with environmental scanning activities. OFFICES OF PHYSICIANS, DENTISTS AND OTHER HEALTH PRACTITIONERS INDUSTRY OVERVIEW Surveys were conducted of Calgary and area business from the Offices of Physicians (NAICS 6211), Offices of Dentists (NAICS 6212), and Offices of Other Health Practitioners (NAICS 6213) industries. These industries are part of Canada s Health Care and Social Assistance sector (NAICS 62), and fall under the Ambulatory Health Care Services subsector (NAICS 621). Health Care and Social Assistance (NAICS 62) o Ambulatory Health Care Services (NAICS 621) Offices of Physicians (NAICS 6211) Offices of Dentists (NAICS 6212) Offices of Other Health Practitioners (NAICS 6213) o Hospitals (NAICS 622) o Nursing and Residential Care Facilities (NAICS 623) o Social Assistance (NAICS 624) 70 NAICS = North American Industry Classification System Alberta Employment, Immigration and Industry 45
As a whole, the Health Care and Social Assistance sector (NAICS 62) comprises approximately 8 per cent of employment in the Calgary Census Metropolitan Area (CMA), or 45,800 jobs in the 2001 federal census. The Ambulatory Health Care Services subsector (NAICS 621) comprises approximately 2.6 per cent of employment in the Calgary CMA, or 14,500 jobs in the 2001 federal census. According to Industry Canada, the Health Care and Social Assistance sector in Alberta in 2005 had approximately 11,200 establishments, of which 9,800 were classified as employers, and 1,400 were classified as non-employers/indeterminate. 71 The sector is dominated by micro- and small-sized establishments with 51 per cent of those employers classified as micro-sized (1 4 employees); 44 per cent as small-sized (5 49 employees); 5 per cent as medium-sized (50 499 employees); and less than 1 per cent as large-sized (500+ employees). 72 Based on the 2001 federal census, the occupation breakdown for the Ambulatory Health Care Services subsector in the Calgary CMA is as follows: Figure 9: Ambulatory Health Care Services - Occupation Share of Total Employment 71 72 Some establishments do not employ any individuals, and in some cases employment estimates are indeterminate. Non-employers are in effect owner operated and the owners do not pay wages or salaries to themselves as an employee of the company. Even though some establishments do not maintain employee payrolls, they may have work forces, which may consist of contracted workers, part-time employees, family members or business owners. Industry Canada, Canadian Industry Statistics, Establishments Health Care and Social Assistance (NAICS 62). Alberta Employment, Immigration and Industry 46
The occupation profile of the Ambulatory Health Care Services subsector is dominated by: Health occupations (comprises 62 per cent of all employment in this subsector). Of this total, the major occupation groups are: professional occupations in health including physicians, dentists, chiropractors, optometrists and other health care professionals (37 per cent); technical occupations in health including dental hygienists, opticians and licensed practical nurses (34 per cent); assisting occupations in support of health services including dental assistants and nurse aides (19 per cent); and nurse supervisors and registered nurses (10 per cent). Business, finance and administration occupations (comprises 25 per cent of all employment in this subsector). Approximately 83 per cent of the people employed in the Health Care and Social Assistance sector in Alberta are women, and 76 per cent of the people employed are 25 to 54 years of age. In comparison, 45 per cent of the total workers employed in Alberta are women and 69 per cent are 25 to 54 years of age. 73 According to Alberta Employment, Immigration and Industry, Alberta s Health Care and Social Assistance sector is projected to grow on average 2.7 per cent annually from 2005 to 2010. This sector is expected to provide 16.9 per cent of new jobs in Alberta between 2005 and 2010. 74 SURVEY RESULTS A total of 100 surveys were completed including offices of physicians, offices of dentists, and offices of other health practitioners (chiropractors, optometrists, speech therapists, audiologists, physical therapists, and mental health practitioners). The majority of offices surveyed had 10 employees or less, with 43 per cent employing 6 to 10 employees. The offices surveyed represent 864 employees. Of those employees, 581 were full-time, making up 67 per cent of the total. Thirty-three per cent, or 283 employees, were part-time. Offices were asked how many employees they had hired in the past three months. In total, the number of new hires reported was 110, representing 13 per cent of the total workforce. Of those new hires, 72 (or 65 per cent) were classified as full-time. Turnover is an issue in this industry, with 74 per cent of new employees hired as a result of turnover, 25 per cent hired as a result of growth, and 1 per cent hired as a result of retirement. Figure 10: Survey Respondents by Office Size 73 74 Alberta Human Resources and Employment, Health Care and Social Services Industry, Data Development and Evaluation, Revised September 2005, p.6. Ibid, p.3. Alberta Employment, Immigration and Industry 47
Table 22: Summary of Respondents Offices of Physicians, Dentists and Other Health Practitioners Number Per cent Number of surveys completed 100 Difficulty hiring 51 51% No difficulty hiring 49 49% Workforce total 864 Full-time 581 67% Part-time 283 33% Total new hires 110 Full-time 72 65% Part-time 38 35% Hires related to growth 28 25% Hires related to turnover 81 74% Hires related to retirement 1 1% Hiring Difficulties Of the 100 offices surveyed, 51 reported having difficulty hiring new staff. Table 23: Hiring Difficulties by Office Size Company Size Difficulty hiring Per cent No difficulty hiring Per cent 1-5 16 43% 21 57% 6-10 25 57% 19 43% 11-50 10 53% 9 47% Total 51 51% 49 49% Alberta Employment, Immigration and Industry 48
Table 24: "What occupations have you had the most difficulty hiring?" Position NOC Code Total # of companies reporting difficulty Length of time position unfilled < 3 months > 3 months Continually hiring Surgical Administrator 1221 1 1 Medical Secretary 1243 1 1 Receptionist 1414 19 14 4 1 Customer Service Representative 1453 1 1 Pediatrician 3111 1 1 Physician 3112 1 1 Audiologist 3141 2 1 1 Physiotherapist 3142 4 4 Registered Nurse 3152 2 2 Medical Radiation Technologist 3215 1 1 Medical Sonographer 3216 1 1 Dental Hygienist 3222 8 8 Optician 3231 2 1 1 Licensed Practical Nurse 3233 1 1 Dental Assistant 3411 9 7 2 Medical Office Assistant 3414 3 3 Chiropractic Assistant 3414 1 1 Optometrist Assistant 3414 1 1 Optical Assistant 3414 2 2 Physiotherapy Assistant 3414 1 1 TOTAL 62 50 11 1 Receptionists (NOC 1414) Of the 51 offices having difficulty hiring, 19 of those reported difficulty in hiring receptionists. The most common reason for the hiring difficulties in this occupation was a lack of experienced or qualified applicants. We don't get many resumes, and the ones that we do get don't have the qualifications we are looking for. Hardly anyone is applying, and we would like someone with at least some general experience in the medical field. Dental Assistants (NOC 3411) Nine of 51 offices reported difficulty in hiring dental assistants. The most common reason for the hiring difficulties in this occupation was a lack of applicants. Many offices reported they did not receive any resumes when they advertised for this occupation. We just aren't getting any resumes. There just aren t enough dental assistants out there! Alberta Employment, Immigration and Industry 49
Dental Hygienists (NOC 3222) Eight of 51 offices reported difficulty in hiring dental hygienists. The most common reason for the hiring difficulties in this occupation again was a lack of applicants. Many offices said that it was very important the person was the right fit. The trouble has been finding someone who is a good fit for our office. Difficulties finding hygienists is not new. This has been a problem for at least 5 years now. There just aren't enough to go around. Other Assisting Occupations in Support of Health Services (NOC 3414) Eight of 51 offices reported difficulty in hiring other assisting occupations including medical office assistants, chiropractic assistants, optometrist assistants, optical assistants, and physiotherapy assistants. Most offices reported they just don t have enough people applying for this position, and many said low wages and hours were an issue. No one wants to work evenings or Saturdays, and wages are also an issue. No one is applying for the position, probably because of the hours. We need someone who can work weekends. Figure 11: "How has your office been affected by the labour shortage in Calgary?" Thirty-eight per cent of the offices surveyed said the labour shortage in Calgary is affecting their business. When asked how their office has been affected, 25 said employees have had to cover other positions. We have audiologists coming in to work at our clinic from other clinics. The techs can do some things, but not everything, said one office manager. Twenty-four offices reported employee stress has increased and 13 said employees are working more overtime. Patients are also feeling the effects of the labour shortage. Offices reported service quality has decreased, hours of operation have had to be modified or reduced, patient wait times have increased, appointments have had to be cancelled, and patient complaints have increased. The wait times are longer than ever which is upsetting, lamented one office representative. We have people in here that want to be in yesterday, and don't want to wait. Some patients can wait, and some people do their best to make the staff miserable. Also, we are having to close every night at 7 pm instead of 9 pm because we can't find any doctors, and we were closed all day last Sunday because no one could come in! Alberta Employment, Immigration and Industry 50
Attraction and Retention Strategies A series of four questions was asked of survey respondents about recruitment and retention strategies. Figure 12: What resources does your office use to recruit employees? Sixty-three offices reported they use the Calgary Herald to recruit employees. The next most common response was employee referrals/word of mouth, followed by the Internet. I usually switch between the Herald and Calgaryjobshop.ca, said one respondent. The Herald is so expensive, and it seems as though more people are looking for jobs on the Internet now anyway. We use a lot of word of mouth, mentioned another. Employees know people they went to school with, the reps know people, and sometimes even the clients know people who are looking. Calgaryjobshop.ca and Service Canada s Job Bank were the Internet sites most often mentioned. Figure 13: What skills or competencies are difficult to find when looking for new employees? Relevant work experience and education/training were the most common responses when asked, what skills or competencies are difficult to find, mentioned by 63 and 56 offices respectively. It is not essential that they have worked in pediatrics before, but we like to have people with some sort of medical experience, said one respondent. We can't take any partially trained people unfortunately, mentioned another. You have to be trained, you have to be organized and you have to know what you're doing. Interpersonal skills were also reported by 27 offices as difficult to find. We need someone who is positive and can get along with the clients, said one office representative. Alberta Employment, Immigration and Industry 51
Figure 14: What type of training does your office provide to existing employees? Eighty-three per cent of the offices surveyed said they provide some type of training to their employees. The offices that do not provide training said all of their positions require a person to be fully educated and trained prior to hiring. Upgrading and getting the required number of points every year is required for hygienists and registered dental assistants to keep their license. These are covered, but no additional training is given, said one respondent. Figure 15: What are the most effective methods your office uses to retain existing employees? A good company culture was the retention strategy most often mentioned by offices, followed by a competitive salary. It is the people and this place, and for many of us we will never leave because this job is really a part of our lives now, said one respondent. Twenty-three offices reported that excellent leadership/management retained their office staff. We have a great boss who doesn't take us for granted and rewards us if we've put in some extra effort, mentioned one employee. We have a great boss who treats us like gold, said another. Alberta Employment, Immigration and Industry 52
Hiring Intentions Respondents were asked to identify additional positions they expected to hire in the next three months. Table 25: Hiring intentions over the next three months Position NOC code Full-time Part-time Total Surgical Administrator 1221 1 1 Receptionist 1414 9 4 13 Physician 3112 2 2 Speech Therapist 3141 1 1 Audiologist 3141 1 1 Physiotherapist 3142 2 2 Occupational Therapist 3143 1 1 Registered Nurse 3152 1 1 Medical Radiation Technologist 3215 2 2 Dental Hygienist 3222 3 2 5 Optician 3231 4 2 6 Dental Assistant 3411 12 2 14 Medical Office Assistant 3414 3 3 Occupational Therapy Assistant 3414 2 2 Optical Assistant 3414 1 1 Physiotherapy Assistant 3414 1 1 Total 41 15 56 HIGH DEMAND OCCUPATIONS DESCRIPTIONS 75 The highest demand occupations in the Offices of Physicians, Dentists and Other Health Practitioners industry as indicated by the survey results are for dental assistants, receptionists, opticians and dental hygienists. Dental Assistant (NOC 3411) Dental assistants assist dentists during the examination and treatment of patients and perform clerical functions. Their main duties include sterilizing and preparing dental instruments, processing x-rays, polishing teeth and applying fluoride, taking preliminary impressions for diagnostic casts, performing specialized orthodontic procedures, as well as other clerical duties such as coordinating appointments, and maintaining supply of inventory. Most dental assistants are employed in private practice dental offices. Employment is also available in community health agencies, hospital clinics, dental insurance companies, and dental supply companies. In dealing with the public, dental assistants require good communication and interpersonal skills as well as the ability to put patients at ease during their procedures. Other necessary skills are the ability to pay close attention to detail, applying critical thinking, remaining calm under pressure, as well as good organizational and time management skills. 75 Alberta Learning Information Service, www.alis.gov.ab.ca, OCCInfo, Alberta Occupational Profiles; Human Resources and Skills Development Canada, National Occupation Classification 2006. Alberta Employment, Immigration and Industry 53
To become a dental assistant in Alberta, a one-year dental assistant certificate program must be completed. Graduates of accredited programs are able to register for practice upon successful completion of the National Dental Assisting Examining Board (NDAEB) written exam. In Alberta, dental assistants may enroll in a dental assistant training program and then look for related work in the field. Throughout their employment period they are required to complete the certificate program through independent study as well as the NDAEB written exam. Medical/Dental Receptionist (NOC 1414) Medical and dental receptionists provide a direct link between patients and an organization s staff and services. Their main duties include greeting patients, scheduling appointments, using manual or computerized systems, receiving and recording payments and directing patients to appropriate areas. Because they work directly with the public, medical and dental receptionists must have a friendly, positive attitude towards others and strong verbal and communication skills. They need to have good organizational skills and the desire and ability to work with little supervision, which will assist them in their general office procedures. In Alberta, most employers prefer to hire candidates who have at least a high school diploma, plus related training or experience. Many institutions offer training programs both full time and part time that range from seven weeks to one year in length. Employment is available in medical and dental offices, hospitals, and other institutions. Optician (NOC 3231) Opticians are involved in providing client services related to obtaining eyeglasses or contact lenses. Their main duties include fitting clients with prescription eyeglasses or contact lenses from a prescription prepared by an optometrist or ophthalmologist, assisting clients in the selection of eyeglass frames, arranging for the production of eyeglasses or contact lenses, mounting lenses in eyeglass frames, and advising on the use and care of contact lenses. Opticians should enjoy dealing with people and operating optical devices. They regularly interact with clients and therefore should possess a pleasant manner, excellent communication skills and the ability to analyze and interpret client issues. Working with eyeglasses and contact lenses they require strong finger dexterity and the ability to pay close attention to details. To become a registered Optician in Alberta, candidates must possess a combination of practicum experience and technical courses. They must complete a two-year college program in ophthalmic dispensing. Completion of an Optician s Guild two-year contact lens technician correspondence course may also be required for contact lens technicians. Also, provincial legislation requires that all Opticians must be registered under the Alberta Opticians Association (AOA). Registered Opticians are employed in optical retail dispensaries, refractive surgery clinics, low vision practices, and teaching environments. Dental Hygienist (NOC 3222) Dental hygienists provide dental hygiene treatment and information related to the prevention of diseases and disorders of the teeth and mouth. Most dental hygienists work in clinical settings where their main duties include assessing and diagnosing oral health conditions, developing individualized treatment plans for clients, exposing and interpreting x-rays, using delicate hand instruments and precision power instruments to provide clinical therapies, and implementing preventative and health promotion programs. As a result of their direct relationship with the public, dental hygienists must have excellent verbal and nonverbal communication skills and a strong desire to work in a team environment. Since their job duties Alberta Employment, Immigration and Industry 54
sometimes require both physically assisting patients and handling large equipment, as well as diagnosing oral conditions, they must have good overall health and strong problem solving and critical thinking abilities. In Alberta, the University of Alberta offers a Dental Hygiene diploma program and a four-year Bachelor of Science Dental Hygiene specialization program. The diploma program is a three-year program, with one preprofessional year and two additional years to complete. The degree program requires successful completion of the diploma plus one year. Dental hygienists must register with the College of Registered Dental Hygienists of Alberta in order to provide professional services to the public. Once registered Dental hygienists are employed in private dental offices, independent practices, or other institutions such as hospitals or community health centers. SUMMARY OF RECRUITMENT AND RETENTION ISSUES AND ADDITIONAL COMMENTS A number of survey respondents added comments and information of interest. A summary of questions and representative comments are captured here. Thirty-eight per cent of the offices surveyed said the labour shortage in Calgary is affecting their business. Twenty-five offices reported employees have had to cover other positions and 13 said employees are working more overtime. We have all just been working extra hours to cover for people. We have been adamant that we will not cancel appointments or turn down clients. Thankfully, we had a summer student this year. She was only hired as part-time, but she ended up working for us full-time for almost the whole summer. I think everyone has been a little worried about covering all the extra shifts - especially in the summer. I am working at least 6 days a week every week and I am almost 60 years old! Twenty-four offices said employee stress has increased. We were all a little stressed out for a while about being short staffed, but we changed our hours a bit and everyone pitched in to cover. Right now we are a little stressed out because we have some of the staff taking time off for holidays and we don't have a replacement. It is always stressful when you can't get a day off. We are really busy. Many offices reported they ve had to reduce or modify their hours of operation and cancel appointments as a result of staff shortages. Patient complaints are on the rise as wait times have increased. The quality of service that we provide our clients with has really gone down. We have had to cancel appointments, people are waiting long stretches of time to get an appointment, and usually when they get here for an appointment we are already backed up. There are a lot of overtime hours being worked, but it still isn't covering all the shifts. The doctor is very upset, because we are no longer able to accept new patients. The wait list for an appointment is now over a month. We are all working extra hours and we are having to look at increasing wages just to keep the staff we have. We have had to cancel appointments, cancel whole days and it has really affected how we do things. It is unpredictable now, and it is difficult to reschedule all these appointments. Alberta Employment, Immigration and Industry 55
We have had to cancel appointments or scrap whole days because we could not find the staff. It is also very difficult to take on new clients, and it is uncomfortable thinking that we may not have the staff we require should someone come in for an emergency appointment. Some additional comments from offices that reported they have not been affected by the labour shortage included: We have been very fortunate in that we seem to have come across a really good group of people that work hard and want to be here. We have not been affected because we have decided to keep this a family business. We have not been too happy with the people we have been forced to hire in the past. When asked, What resources does your company use to recruit employees? the Calgary Herald was the most common response, followed by employee referrals/word of mouth. We usually use a combination. We ask around, and put an ad in the Herald if we need someone. We've had a lot of luck with the paper (Calgary Herald) in the past. The Herald costs lots of money, with little result. I have now decided to just ask around, and get the girls to ask around. Now, we try to rely only on word of mouth. We find this weeds out a lot of the people we don't want. Thirty-three offices said they use the Internet to recruit employees, while 13 offices reported they get many walk-ins and unsolicited resumes. We tried everything! We were hounding the reps for tips. We ended up having the best luck with Monster.ca because it advertises all over Canada. We get a lot of people coming in and dropping off their resume. The last girl we hired walked in with a resume, and I interviewed her on the spot. It just goes to show, cold calling works. A few offices mentioned they recruit from technical/trade institutes and colleges. Bow Valley is the only place in Calgary to get your MOA (Medical Office Assistant) certificate right now. I advertise locally, in BC and Ontario, and on every school website that has a dental assisting program. The dental assistant program is only 10 months long, so we have been calling the schools non-stop to try to get some grads from the next class. When asked, What skills or competencies are difficult to find when looking for new employees? relevant work experience and education/training were the top responses, mentioned by 63 and 56 offices respectively. We look for either training or experience. We like people who have their MOA (Medical Office Assistant) course. This is a surgical office, so we like to have people with training and a medical background. Alberta Employment, Immigration and Industry 56
Although we got many responses to our ad, many of them did not have the basic qualifications we were looking for. Education is a must, experience is preferred. It's hard to find an experienced part-time person. Interpersonal skills, work ethic and communication skills were the next most often reported skills or competencies that are difficult to find. To work in the office here, it is more important that you are patient and good with people. This is the kind of job where everybody is important and everybody matters. You have to be able to deal with people when they are feeling their worst. Mostly, we just want someone who is reliable and dependable. You have to have the personality for this job. With the wait times longer, people get grumpy! We really just want someone who will show up to work. You'd expect that kind of behavior from a kid in high school, but not an adult. Customer service is not what it used to be. This is not just a problem in this industry. People just don't care. Where did that attitude come from? There are very few good role models for young people, and the people who are good workers and try hard seem to get all the work dumped on them and they get frustrated. You have to be understanding and considerate of people. There are times people call here in a crisis, and you need to be able to deal with that. Eighty-three per cent of the offices surveyed said they provide some type of training to existing employees. Some additional comments related to training included: We do a lot of training here (in-house), but we do send staff out for some training every year. We have a 2-week training program for all staff. The training provided is very basic. We expect to show people around, not teach them how to do their job. We do a lot of outside courses and conferences. The staff is constantly being offered upgrades, and every year we all go to Vancouver for a conference. Also, this year some of the staff is going to Sacramento for a conference. The doctor is always offering continuing education courses. He pays for books, flights - the whole thing. You'd think more people would be interested! When asked, What are the most effective methods your company uses to retain existing employees? the most common response was a good company culture, mentioned by 68 offices. The atmosphere here is always pleasant, and it really is a good environment to work in. This is a small office, and everyone knows each other. You are not just an employee number here and there is a lot of mutual respect amongst the staff. They really make you feel appreciated here, and it is a good work environment. Alberta Employment, Immigration and Industry 57
Thirty offices said a competitive salary was an effective retention strategy. Money talks. For the receptionist position, I did not get a single applicant for $14/hour or $15/hour. When I bumped the wage up to $16/hour, I got 3 applications. You have to pay people. They pay us well, and make it a nice place to work. This company pays well, gives great bonuses and benefits and has really good people working here. The bosses try to be employers of choice. We try to pay the top wages in the city, and have one of the best benefits/compensation packages around. There are tons of perks. They are always buying lunch and coffee - you kind of have to do these kind of things now. Also, every Christmas, they take everyone up to Kananaskis for a weekend at the spa. Twenty-three offices said it was the excellent leadership and management that was retaining employees. It is the personality of the boss that makes the biggest difference! We just have a really great boss. The Doctor has proven himself to be very compassionate and will bend over backwards to make us happy. He is easy to work with and understands that we have a stressful job. He makes sure to close down the office completely for a couple of weeks a year so all of us can enjoy some time off. The Doctor is a good boss to work for, and that's why we have all been here as long as we have. The Doctor is an amazing boss. We always get a great Christmas bonus every year and the rest of the year we are always getting little perks like gift cards and treats. Also, once a month he takes us for lunch, and once every 2 or 3 months he takes us all for dinner and a movie. He really makes working here worthwhile! Finally, offices were given the opportunity to contribute any additional comments about recruitment and retention issues in their industry. Right now NAIT and SAIT are only putting out 16 graduates a year (Medical Radiation Technology). That is not nearly enough. I tried to hire a woman from the States, and it seemed like her courses were equivalent, but when I looked into it, the process of getting her out here and working was very arduous and would have probably taken over a year. It's too bad because we need these people. I can see in some instances, because some programs have courses that are 28 weeks instead of 8 months, but some seem almost identical. I hire a lot of people who were trained outside of Canada. Most were dentists in their own country and went to school for almost 10 years. The quality of their work is fine, and they are happy to work as assistants or hygienists, but they struggle with the English computer programs, charting, and communication. To me, there has to be something getting education and industry together. The government has to coordinate our growing need for people, and the number of people able to fill these spots. I have been in this business for 25 years, and I must tell you, the girls that do apply for these jobs are not aggressive enough. You have to be inquisitive and take initiative about Alberta Employment, Immigration and Industry 58
things. They will go and request a consult and not even know why or understand what they're doing. You have to ask questions. You can go far in this field if that's what you want, but it seems girls today are just applying here because they need to have a job, not because they are looking for a career. This generation seems to have a completely different attitude than we did. I will give someone a chance, but if they aren't picking it up right away, I'll have to let them go. We are getting some applications from people that are foreign-trained. We try to hire them if we can - we actually just hired a girl from Russia - but there are limits as to what they can do. There are licensing exams that you need to work in Canada, and not all training programs are equivalent. It seems like a lot of girls here are moving back to Saskatchewan, and no one is looking for a job in Calgary anymore. We have been without an Audiologist for 18 months now! Before that, we also waited 18 months. This is not a new problem. There are 30 hearing clinics in Calgary, and they are all vying for the same people. PERSONAL CARE SERVICES INDUSTRY OVERVIEW Surveys were conducted of Calgary and area business from the Personal Care Services (NAICS 8121) industry. This industry is part of Canada s Other Services sector (NAICS 81), and falls under the Personal and Laundry Services subsector (NAICS 812). Other Services (NAICS 81) o Repair and Maintenance (NAICS 811) o Personal and Laundry Services (NAICS 812) Personal Care Services (NAICS 8121) o Religious, Grant-Making, Civic and Professional and Similar Organizations (NAICS 813) o Private Households (NAICS 814) As a whole, the Other Services sector (NAICS 81) comprises approximately 4.5 per cent of employment in the Calgary Census Metropolitan Area (CMA), or 25,200 jobs in the 2001 federal census. The Personal and Laundry Services subsector (NAICS 812) comprises approximately 1.3 per cent of employment in the Calgary CMA, or 7,200 jobs in the 2001 federal census. According to Industry Canada, the Other Services sector in Alberta in 2005 had approximately 22,100 establishments, of which 12,600 were classified as employers, and 9,500 were classified as nonemployers/indeterminate. 76 The sector is dominated by micro- and small-sized establishments with 64 per 76 Some establishments do not employ any individuals, and in some cases employment estimates are indeterminate. Non-employers are in effect owner operated and the owners do not pay wages or salaries to themselves as an employee of the company. Even though some establishments do not maintain employee payrolls, they may have work forces, which may consist of contracted workers, part-time employees, family members or business owners. Alberta Employment, Immigration and Industry 59
cent of those employers classified as micro-sized (1 4 employees); and 34 per cent as small-sized (5 49 employees). 77 Based on the 2001 federal census, the occupation breakdown for the Personal and Laundry Services subsector in the Calgary CMA is as follows: Figure 16: Personal and Laundry Services - Occupation Share of Total Employment The occupation profile of the Personal and Laundry Services subsector is dominated by the following occupation group: Sales and service occupations (comprises 73 per cent of all employment in this subsector). Of this total, the major occupation groups related to the organizations surveyed are: hairstylists and barbers (52 per cent); and estheticians, electrologists and related occupations (13 per cent). Management occupations (comprises 9 per cent of all employment in this subsector). Approximately 49 per cent of the people employed in the Other Services sector in Alberta are women, and 65 per cent of the people employed are 25 to 54 years of age. In comparison, 45 per cent of the total workers employed in Alberta are women and 69 per cent are 25 to 54 years of age. 78 According to Alberta Employment, Immigration and Industry, Alberta s Other Services sector is projected to grow on average 0.7 per cent annually from 2005 to 2010. This sector is expected to provide 1.5 per cent of new jobs in Alberta between 2005 and 2010. 79 77 78 79 Industry Canada, Canadian Industry Statistics, Establishments Other Services (except Public Administration) (NAICS 81). Alberta Human Resources and Employment, Other Services Industry, Data Development and Evaluation, Revised September 2005, p.6. Ibid, p.3. Alberta Employment, Immigration and Industry 60
SURVEY RESULTS A total of 100 surveys were completed for the Personal Care Services industry including companies providing esthetic and hair care services, spa treatments, hair removal, hair replacement and scalp treatment services, diet counseling services, ear piercing services, tanning services and massage services. The majority of companies surveyed (78 per cent) had 10 employees or less. The companies surveyed represent 845 employees. Of those employees, 655 were fulltime, making up 78 per cent of the total. Twenty-two per cent, or 190 employees, were part-time. Figure 17: Survey Respondents by Company Size Companies were asked how many employees they had hired in the past three months. In total, the number of new hires reported was 194, representing 23 per cent of the total workforce. Of those new hires, 132 (or 68 per cent) were classified as full-time. When asked the reason for the new hires, companies reported 86 per cent were related to turnover, and the remaining 14 per cent, or 28 new hires were related to growth. Table 26: Summary of Respondents Personal Care Services Number Per cent Number of surveys completed 100 Difficulty hiring 42 42% No difficulty hiring 58 58% Workforce total 845 Full-time 655 78% Part-time 190 22% Total new hires 194 Full-time 132 68% Part-time 62 32% Hires related to growth 28 14% Hires related to turnover 166 86% Hires related to retirement 0 0% Alberta Employment, Immigration and Industry 61
Hiring Difficulties Of the 100 companies surveyed, 42 reported difficulty hiring new staff. Larger companies in this industry (those with 11 50 employees) had significantly more difficulty hiring employees than did the companies with 10 employees or less. Table 27: Hiring Difficulties by Company Size Company Size Difficulty hiring Per cent No difficulty hiring Per cent 1-5 17 35% 31 65% 6-10 11 37% 19 63% 11-50 14 64% 8 36% Total 42 42% 58 58% Table 28: "What occupations have you had the most difficulty hiring?" Position NOC Code Total # of companies reporting difficulty < 3 months > 3 months Continually hiring Receptionist 1414 7 3 3 1 Call Centre Agent 1453 1 1 Massage Therapist 3235 2 2 Personal Trainer 5254 3 3 Hairstylists and Barbers 1 6271 17 9 8 Health/Weight Loss Counsellor 6481 4 4 Esthetician 6482 12 9 2 1 TOTAL 46 27 13 6 1 Including: hair stylists, barbers, hairstylist apprentices, and hair braider Length of time position unfilled Hairstylists and Barbers (NOC 6271) Of the 42 companies having difficulty hiring, 17 of those reported having difficulty hiring hairstylists and barbers. A lack of experienced applicants as well as a lack of interest in these positions were the most common reasons. Some additional comments included: Nobody is interested in the job. It seems that people go through these (hairstyling) schools, and then they come out, and they don't want to work. There are a lot of hairstylists in Calgary, but very few are experienced. Alberta Employment, Immigration and Industry 62
Estheticians (NOC 6482) Twelve companies reported difficulty in hiring estheticians. Some of the comments included: It is difficult to find experienced people, and many have just not worked out. You can find bodies, but they do not necessarily make good employees. We just aren t finding anyone that will stay for more than a month. There just doesn't seem to be a lot of estheticians looking for work in Calgary. Receptionists (NOC 1414) Seven companies reported difficulty in hiring receptionists. Low wages and unsuitable applicants were the main reasons for the difficulty. We haven't been getting very many resumes, and the pay isn't that great. We just aren't getting any suitable candidates. The ones we had hired just didn't work out very well. Figure 18: "How has your company been affected by the labour shortage in Calgary?" Forty per cent of the companies surveyed said the labour shortage in Calgary is affecting their business. When asked how their company has been affected, 26 said employee stress has increased. Because of all the new receptionists, we were having some problems with bookings. People weren't getting appointments or they were double booked. This really stressed out the stylists and there were a lot of customer complaints, said one company owner. Twenty-two companies reported they have had to increase wages. A few companies said they ve had to pass those increases on to customers. As wages go up, prices go up, stated one manager. Twelve companies said they ve had to turn down business/clients and another 8 said they have not been able to expand their business. This is such a busy time of year, and I am turning down thousands of dollars worth of business because I don't have staff to take the appointments, lamented one business owner. Alberta Employment, Immigration and Industry 63
Attraction and Retention Strategies A series of four questions was asked of survey respondents about recruitment and retention strategies. Figure 19: What resources does your company use to recruit employees? Employee referrals/word of mouth was the most common resource used to recruit employees, reported by 62 companies, followed by walk-ins and unsolicited resumes. I only work with people I know personally, said one manager. We are located on a busy street, so there are always people coming in and dropping off resumes, mentioned another. When the Sun, Herald and local papers were combined, newspaper advertising was a resource mentioned by 41 respondents. Seventeen companies said they used the Internet to recruit employees including thehairline.com, jobbank.gc.ca, and calgaryjobshop.ca. Figure 20: What skills or competencies are difficult to find when looking for new employees? When asked what skills or competencies are difficult to find when looking for new employees, education/training, and relevant work experience were the top responses. You need a degree in nutrition or a degree in kinesiology to be a counselor here, mentioned one manager. People skills is the biggest thing, but we can't hire someone just because of it. We always require an educational background, but we hire very few people right out of school. We prefer our employees to have experience, said another. Twenty-five companies reported interpersonal skills were difficult to find, and another 23 said customer service skills were difficult to find. The customer service in Calgary is some of the worst I ve ever seen, lamented one manager. To succeed in this industry you have to be good with people, reported another. Alberta Employment, Immigration and Industry 64
Figure 21: What type of training does your company provide to existing employees? Eighty-six per cent of the companies surveyed said they provide some type of training to their employees. Eighty-four per cent provide internal training only and 2 per cent provide both internal and external training. The training here is very extensive. We want all our people to be very knowledgeable about our products, said one company representative. Fourteen per cent of the companies surveyed said they do not provide training. I am too small - I simply don't have time to train anyone, explained one company owner. Figure 22: What are the most effective methods your company uses to retain existing employees? Fifty-eight companies reported a good company culture was an effective method in retaining existing employees, while 25 companies said flexible work measures. This is such a fun job it's just really, really fun, mentioned one company representative. They are really good about letting us have time off, and the hours are good. We can pretty much make our own schedule, commented another. Other effective retention methods included a good location, opportunities for advancement, and lots of walk-in clients. Alberta Employment, Immigration and Industry 65
Hiring Intentions Respondents were asked to identify additional positions they expected to hire in the next three months. Table 29: Hiring Intentions Over the Next Three Months Position NOC code Full-time Part-time Total Receptionist 1414 5 3 8 Massage Therapist 3235 1 1 Surgical Assistant 3414 2 2 Personal Trainer 5254 6 6 Hairstylists and Barbers 1 6271 23 23 Sales Associate 6421 2 1 3 Health/Weight Loss Counselor 6481 7 7 Esthetician 6482 7 1 8 Total 51 7 58 1 Including hairstylists, barbers, hair dressers, assistant hairstylists, and hair braiders. HIGH DEMAND OCCUPATIONS DESCRIPTIONS 80 The highest demand occupations in the Personal Care industry as indicated by the survey results are for hairstylists and barbers, estheticians and receptionists. Hairstylist and Barber (NOC 6271) Hairstylists and barbers cut and style hair to reflect the clients needs and lifestyle. Their main duties include shampooing, cutting, trimming, coloring, and styling hair. They also consult clients on appropriate styling aids, and analyze the hair and scalp for recommended treatments. Barbers also trim beards and moustaches. They focus on providing quality hair services and thus should possess good customer service skills and an ability to understand client needs. As fashions are always changing they should have a keen interest in the hair industry and remain up to date with new hair trends, supplies and technology. To work in Alberta, a hairstylist must be one of the following: a registered apprentice, a certified journeyperson, or someone who holds a recognized trade certificate. To become a registered apprentice candidates must complete two years of apprenticeship including a minimum of 1400 hours of on-the-job training and ten weeks of technical training each year. Technical training is available at Marvel College in Edmonton and Delmar College of Hair Design in Calgary. Outside the apprenticeship program, related training is available at institutions such as Academy of Professional Hair Design and Est-Elle Academy of Hair Design. Hairstylists are mostly employed by beauty salons and can move into related positions such as estheticians, nail technicians, and salespeople for beauty supplies. 80 Alberta Learning Information Service, www.alis.gov.ab.ca, OCCInfo, Alberta Occupational Profiles and Human Resources and Skills Development Canada, National Occupation Classification 2006. Alberta Employment, Immigration and Industry 66
Esthetician (NOC 6482) Estheticians provide facial and body treatments designed to enhance the physical appearance of their clients. Their main duties include assessing each client s skin condition, advising clients about skin care, demonstrating proper care of skin, providing facials and other skin treatments and advising clients on suitable skin products. They may also offer other personal enhancement services such as make-up consultations, treatments for nails, hands and feet, hair-removal, and spa treatments. Estheticians should possess an interest in skin/personal care and be willing to continue learning about new products and services. Their related knowledge will assist them in offering informative treatment solutions to clients. While they must be able to advise clients on solutions, they should also demonstrate an attractive personal appearance. In Alberta, there are no standard education requirements for estheticians. Employers do require esthetics training that may be acquired from various schools such as the Alberta Academy of Aesthetics in Edmonton and Zeneba Academy of Esthetics in Calgary. People interested in this occupation should discuss their training options with practicing estheticians and potential employers. Estheticians may be employed or work on a contract basis in beauty salons, cosmetology shops, spas, fitness centers, clinics or home-based businesses. Receptionist (NOC 1414) Receptionists provide a direct link between clients and an organization s staff and services. Their main duties include greeting clients, scheduling appointments, using manual or computerized systems, receiving and recording payments and directing clients to appropriate areas. Because they work directly with the public, receptionists must have a friendly, positive attitude towards others and strong verbal and communication skills. They need to have good organizational skills and the desire and ability to work with little supervision, which will assist them in their general office procedures. In Alberta, most employers prefer to hire candidates who have at least a high school diploma, plus related training or experience. Many institutions offer training programs both full time and part time that range from seven weeks to one year in length. SUMMARY OF RECRUITMENT AND RETENTION ISSUES AND ADDITIONAL COMMENTS A number of survey respondents added comments and information of interest. A summary of questions and representative comments are captured here. Forty per cent of the companies surveyed said the labour shortage in Calgary is affecting their business. When asked, How has your company been affected by the labour shortage in Calgary? 26 companies said employee stress has increased. We are a mid to high class of salon, and we cannot simply pull someone off the street and show them what to do. During the busy times, this can be quite stressful. We all have to deal with it. It has been very hard and stressful. I can't take a day off for anything or I would have to close. I even had to go and get special insurance in case I get sick. Alberta Employment, Immigration and Industry 67
Sixteen companies reported employees are working more overtime and 8 companies mentioned it is difficult to take time off. We are both working a lot of hours. People are having to wait longer, and it is extremely hard to take a day off. I am used to working extra hours. When you have your own business, you are always working overtime. I don't even bother trying to take a day off now. I work 6 days a week, Monday to Friday 9:00-8:00 and Saturday 9:00-5:00. It is hard for clients to get an appointment. People walk by, they see me working alone and busy, so they go somewhere else because they don't want to wait. Twelve companies said they ve had to turn down business/clients and another 8 said they have not been able to expand their business. Our business has really suffered because we are having to turn people away and cancel appointments. Without a receptionist, we are missing more calls and probably more business. Our business is stagnant right now - we are super busy, but can take on no more clients. Some additional comments from companies that reported they have not been affected included: I think that because I am small and I have no plans to expand - business is good. We are located by a college, so we get resumes all the time. We have chosen to only be as busy as we have staff for. No one is overworked. When asked, What resources does your company use to recruit employees? employee referrals/word of mouth was the most common response, mentioned by 62 companies. We usually just go to our employees and have them ask around. Most people like the idea of hiring one of their friends. I have been in this business for a while now - I know a lot of people. Thirty-seven companies reported they get many unsolicited resumes and walk-in applicants. Mostly, people just come in and apply. We get a ton of resumes being dropped off all the time. We are located in Kensington, so finding staff is never a problem. Twenty-one companies said they use the Calgary Sun to recruit employees, 18 said they use the Calgary Herald, and 2 reported they use other local newspapers. Many respondents complained of the cost of a newspaper ad for the very few responses they received. Primarily we like to use word of mouth, but we will also use the papers if we are desperate. We usually advertise in Fast Forward, because we seem to get the best response. I have had an ad running in the Sun for 6 weeks straight now without any response - it is very expensive. I use the Herald and the Sun. The Herald is so expensive - $300 for 1 week. The Sun is much more reasonable, but I think in Calgary more people read the Herald to find jobs. I Alberta Employment, Immigration and Industry 68
have had ads in the Sun for 7 months before and had no luck. I would rather pay a little more upfront and find someone right away. When asked, What skills or competencies are difficult to find when looking for new employees? education/training and relevant work experience were the top responses. You have to have the training, and we prefer to find someone with experience, but we also try to find people who really fit in here. I need 2 things - basic training, and experience. The #1 thing we look for on a resume is that they've been to a school. There are lots of people out there who have not been to school trying to get jobs. Some of them may be very good, but we prefer our staff has an education. Twenty-five companies reported interpersonal skills were difficult to find, 23 said customer service skills, and 15 companies said work ethic. You've got to be good with people, because that's what gets clients. All I want is someone reliable and fun who is good to the customers. We just want people that are good with customers and will show up on time. A lot of the people I hire in the 18-20 age group have no loyalty or work ethic. They show up when they want and will quit without notice. Eighty-six per cent of the companies surveyed said they provide some type of training to existing employees. Some additional comments related to training included: Our training is very organized and very thorough. That is part of the reason we are so picky of who we hire. We need to know that if we invest this much time and effort into someone it will pay off. There is two weeks of training before you can even begin. After you start, there is an additional week. Normally, I wouldn't train someone. I like to have people with experience, but if the right person came in with the right personality and good people skills, I would consider it. It's just that we are so busy. When asked, What are the most effective methods your company uses to retain existing employees? the most common response was a good company culture, mentioned by 58 respondents. I used to come here before I worked here, and I just really liked the atmosphere in here. Maintaining the atmosphere and a good work environment is keeping people here. The people we work with are fantastic. Also, the bosses are really open, and it really feels like a big family. Alberta Employment, Immigration and Industry 69
Twenty-five companies said flexible work measures was helping to retain staff, while 15 said a competitive salary was an effective retention strategy. As a student, the hours are great. They always work around my schedule. I pay well, there are lots of perks and holiday time, and I give my staff what they need so I have the best. The staff here all make between $40,000 and $60,000/year. Also, I think communication is very important, and I make sure everyone gets along. Many companies said social events and discounts/free services were very effective retention methods. We make a big point of having team functions - doing stuff together outside of work hours. I give great perks to people who work here. They get free (services) and discounts on products. They get to work by themselves, and work whatever shifts they want. Also, they get to do it all. You might make more at Burger King, but you won't have as much fun, and you won't get to learn as much. Finally, companies were given the opportunity to contribute any additional comments about recruitment and retention issues in their industry. Our average client is 40 years old, has 2 kids and makes $40,000/year. They also want on average to lose 40 lbs. Often I am forced to hire people who don't have the maturity level to understand what this means. Often, 19 years olds have never tried to lose weight before, and probably have never had to lose 40 lbs with 2 kids to look after. One of my biggest challenges is finding mature people to work with our clients. A problem in the industry is that the schools are so expensive. There aren't many grants or subsidies available. Also, the larger salons are having difficulty because so many of the girls are graduating from school and then going straight to opening up their own salon at home. Many of these girls don't even have insurance, and they don't get the experience or skills you get after working for a commercial salon. I think that a two-year period or practicum should be mandatory before you can be licensed for your own business. I think the problem lies in people s expectations. They pay a lot of money and go to school expecting to be rich when they're done. Then they get out, and they are working for $13/hour + tips/commission. You can make that at Safeway nowadays without going through all the trouble of school. Also, many salons will not take a chance on new grads. If you walk into a salon and I ask you, "I have a new student here, would you mind if they cut your hair today?" you would probably decline. I don't have any comments about the industry, but Calgary needs to slow down. I have been in business for a long time, and I can't believe I am going to have to close my shop. Alberta Employment, Immigration and Industry 70
ACCOUNTING, TAX PREPARATION, BOOKKEEPING AND PAYROLL SERVICES INDUSTRY OVERVIEW Surveys were conducted of Calgary and area business from the Accounting, Tax Preparation, Bookkeeping and Payroll Services industry (NAICS 5412). This industry is part of Canada s Professional, Scientific, and Technical Services sector (NAICS 54), and falls under the Professional, Scientific, and Technical Services subsector (NAICS 541). Professional, Scientific, and Technical Services (NAICS 54) o Professional, Scientific, and Technical Services (NAICS 541) Accounting, Tax Preparation, Bookkeeping and Payroll Services (NAICS 5412) Architectural, Engineering and Related Services (NAICS 5413) Specialized Design Services (NAICS 5414) Computer Systems Design and Related Services (NAICS 5415) Management, Scientific and Technical Consulting Services (NAICS 5416) Scientific Research and Development Services (NAICS 5417) Advertising and Related Services (NAICS 5418) Other Professional, Scientific and Technical Services (NAICS 5419) As a whole, the Professional, Scientific, and Technical Services sector (NAICS 54) comprises approximately 11 per cent of employment in the Calgary Census Metropolitan Area (CMA), or 61,530 jobs in the 2001 federal census. According to Industry Canada, the Professional, Scientific, and Technical Services sector in Alberta in 2005 had approximately 51,000 establishments, of which 23,000 were classified as employers, and 28,000 were classified as non-employers/indeterminate. 81 The sector as a whole is dominated by micro- and small-sized establishments with 71 per cent of those employers classified as micro-sized (1 4 employees); and 26 per cent as small-sized (5 49 employees). 82 Approximately 63 per cent of the people employed in the Professional, Scientific, and Technical Services sector in Alberta are men, and 76 per cent of the people employed are 25 to 54 years of age. In comparison, 55 per cent of the total workers employed in Alberta are men and 69 per cent are 25 to 54 years of age. 83 According to Alberta Employment, Immigration and Industry, Alberta s Professional, Scientific, and Technical Services sector is projected to grow on average 2.9 per cent annually from 2005 to 2010. This sector is expected to provide 11.1 per cent of new jobs in Alberta between 2005 and 2010. 84 81 82 83 84 Some establishments do not employ any individuals, and in some cases employment estimates are indeterminate. Non-employers are in effect owner operated and the owners do not pay wages or salaries to themselves as an employee of the company. Even though some establishments do not maintain employee payrolls, they may have work forces, which may consist of contracted workers, part-time employees, family members or business owners. Industry Canada, Canadian Industry Statistics, Establishments Professional, Scientific and Technical Services (NAICS 54). Alberta Human Resources and Employment, Professional, Scientific and Technical Services Industry, Data Development and Evaluation, Revised September 2005, p.6. Ibid, p.3. Alberta Employment, Immigration and Industry 71
Based on the 2001 federal census, the occupation breakdown for the Professional, Scientific, and Technical Services sector in the Calgary CMA is as follows: Figure 23: Professional, Scientific & Technical Services - Occupation Share of Total Employment The occupation profile of the Professional, Scientific and Technical Services sector is dominated by the following occupation groups: Natural and applied sciences and related occupations (comprises 40 per cent of all employment in this sector). Business, finance and administration occupations (comprises 28 per cent of all employment in this sector). Of this total, the major occupation groups related to the companies surveyed are: auditors, accountants and investment professionals (37 per cent); clerical occupations (31 per cent); secretaries (13 per cent); and administrative and regulatory occupations (10 per cent). Management occupations (comprises 12 per cent of all employment in this sector). The Accounting, Tax Preparation, Bookkeeping and Payroll Services industry includes companies primarily engaged in auditing accounting records; designing accounting systems; preparing financial statements; developing budgets; preparing tax returns; processing payrolls; bookkeeping; and billing. Alberta Employment, Immigration and Industry 72
SURVEY RESULTS A total of 100 surveys were completed for the Accounting, Tax Preparation, Bookkeeping and Payroll Services industry. Sixty-eight per cent of the companies surveyed had 1 to 5 employees, and 30 per cent of the companies had 6 to 50 employees. The companies surveyed represent 720 employees. Of those employees, 594 were reported as full-time, making up 83 per cent of the total. Sixteen per cent, or 115 employees were part-time and 2 per cent, or 11 were contract employees. Several companies said they hire additional contract employees during tax season. Figure 24: Survey Respondents by Company Size Companies were asked how many employees they had hired in the past three months. In total, the number of new hires reported was 97, representing 14 per cent of the total workforce. Of those new hires, 87 (or 90 per cent) were classified as full-time. When asked the reason for the new hires, companies reported 79 per cent were related to turnover and 21 per cent were related to growth. Table 30: Summary of Respondents Accounting, Tax Preparation, Bookkeeping and Payroll Services Number Per cent Number of surveys completed 100 Difficulty hiring 36 36% No difficulty hiring 64 64% Workforce total 720 Full-time 594 83% Part-time 115 16% Contract 11 2% Total new hires 97 Full-time 87 90% Part-time 10 10% Hires related to turnover 77 79% Hires related to growth 20 21% Hires related to retirement 0 0% Alberta Employment, Immigration and Industry 73
Hiring Difficulties Of the 100 companies surveyed, 36 per cent reported having difficulty hiring new staff. Table 31: Hiring Difficulties by Company Size Company Size Difficulty hiring Per cent No difficulty hiring Per cent 1-5 22 32% 46 68% 6-10 5 29% 12 71% 11-50 8 62% 5 38% 51-100 1 50% 1 50% Total 36 36% 64 64% Table 32: "What occupations have you had the most difficulty hiring?" Position NOC Code Total # of companies reporting difficulty Length of time position unfilled < 3 months > 3 months Continually hiring Accounting Manager 0111 1 1 Auditors and Accountants 1111 9 5 4 Office Manager 1211 1 1 Bookkeepers and Accounting Technicians 1231 11 6 4 1 Administrative Assistant 1411 5 1 3 1 Receptionist 1414 2 1 1 Data Entry Clerk 1422 1 1 Accounting Clerks and Income Tax Preparers 1431 5 5 Customer Service Representative 1453 1 1 TOTAL 36 22 12 2 Bookkeepers and Accounting Technicians (NOC 1231) Of the 36 companies having difficulty hiring, 11 of those reported having difficulty hiring bookkeepers or accounting technicians. Some of the comments included: It is hard to find someone who is qualified and has experience. There aren't many to begin with, and few are experienced. It was hard to compete with the big companies. I think the part-time thing is a problem. Alberta Employment, Immigration and Industry 74
Auditors and Accountants (NOC 1111) Nine companies reported having difficulty hiring auditors or accountants. Some of the comments included: It becomes more and more difficult to hire people as you request more skills. It was difficult to find someone who would meet the qualifications and would stick around. The economy has made it very difficult to find these highly qualified people. Administrative Assistants (NOC 1411) Five companies reported having difficulty hiring administrative assistants. A lack of qualified applicants was the most common complaint. I can't seem to find someone who is trained to do anything! Accounting Clerks and Income Tax Preparers (NOC 1431) Five companies also reported having difficulty hiring accounting clerks or income tax preparers. Again, a lack of qualified applicants as well as a lack of interest in the positions were common reasons. It isn't a hard job, there just doesn't seem to be a lot of people interested. Figure 25: "How has your company been affected by the labour shortage in Calgary?" Thirty-seven per cent of the companies surveyed said the labour shortage in Calgary is affecting their business. When asked how their company has been affected, 22 said employee stress has increased, and 13 reported they ve had to turn down business/clients. I am having to turn down business daily. I am forced to work nights and weekends, but still the clients are not happy, said one respondent. Twelve companies reported employees are working more overtime and employees have had to cover other positions. I am currently covering the data entry position, which results in me working a lot more hours, mentioned one company representative. Alberta Employment, Immigration and Industry 75
Attraction and Retention Strategies A series of four questions was asked of survey respondents about recruitment and retention strategies. Figure 26: What resources does your company use to recruit employees? Employee referrals/word of mouth was the most common resource used to recruit employees in this industry, reported by 57 companies, followed by the Calgary Herald and the Internet. I usually find people through word of mouth. My clients know that I am looking for someone, and if they know someone suitable, they will refer them to me, mentioned one company owner. I have honestly had the best luck with the newspaper the old fashioned way, said another. Service Canada s JOB Bank was the Internet site most often mentioned, followed by Calgaryjobshop.ca, Workopolis.com and Monster.ca. Figure 27: What skills or competencies are difficult to find when looking for new employees? Relevant work experience was overwhelmingly the most common response, reported by 75 companies. I don't look for a specific diploma or certificate. I look for people who have experience in bookkeeping first, and software experience second, said one manager. We always just look for someone who has done this before, mentioned another. Education/training was reported to be difficult to find by 37 companies. I like people to have some kind of diploma in accounting, commented one manager. Language skills were mentioned as difficult to find by 9 companies. The only thing I am very strict about is the ability to speak fluent English. There is a lot of communication involved in this job. We need people that can understand and complete the paperwork, and understand the clients. Alberta Employment, Immigration and Industry 76
Figure 28: What type of training does your company provide to existing employees? Eighty-four per cent of the companies surveyed said they provide some type of training to their employees. Sixty-five per cent provide internal training only, and 19 per cent provide both internal and external training. Sixteen per cent of the companies surveyed said they do not provide training. We have tried training before, but it takes up so much time, and we end up farther behind than when we started. We had one girl here on a sponsorship that was with us for 6 months, and at the end, she still didn't get it! said one company representative. We really don't have time, said another. Figure 29: What are the most effective methods your company uses to retain existing employees? A good company culture appears to be the most effective method to retain employees in this industry mentioned by 32 companies. We have a really good work environment - it is not really a controlled place, said one survey respondent. You can work how you want, and decide when and how you will do things. Flexible work measures and a competitive salary were mentioned as being effective methods by 26 and 21 companies respectively. We are really flexible here. You can work evenings if you'd rather, or you can even work from home, said one respondent. Twelve companies reported training/learning opportunities as an effective retention method. This is an excellent place to start your career. There are people here with experience who can guide you on your way, and there are lots of opportunities to learn and gain experience, stated one company representative. Alberta Employment, Immigration and Industry 77
Hiring Intentions Respondents were asked to identify additional positions they expected to hire in the next three months. Table 33: Hiring Intentions Over the Next Three Months Position NOC code Full-time Part-time Total Accounting Manager 0111 1 1 Accountant 1111 7 1 8 Office Manager 1211 3 3 Recruiter 1223 1 1 Bookkeepers and Accounting Technicians 1231 11 1 12 Administrative Assistant 1411 4 4 Receptionist 1414 1 1 Data Entry Clerk 1422 1 1 Accounting Clerks and Income Tax Preparers 1431 5 5 Payroll Clerks 1432 2 2 Customer Service Representative 1453 2 2 Total 38 2 40 HIGH DEMAND OCCUPATIONS DESCRIPTIONS 85 The highest demand occupations in the Accounting, Tax Preparation, Bookkeeping and Payroll Services industry as indicated by the survey results are for bookkeepers, accounting technicians, and accountants. Bookkeepers and Accounting Technicians (NOC 1231) Bookkeepers and accounting technicians maintain systematic records of business transactions and verify and record those transactions. They use computers to calculate, prepare and process invoices, accounts payable and receivable, budget documents and other routine financial records. Their main duties include maintaining and balancing various accounts using manual and computerized bookkeeping systems, posting journal entries and reconciling accounts, preparing and maintaining general ledgers and financial statements, preparing cheques and making bank deposits, and performing other personal bookkeeping services. Bookkeepers and accounting technicians should have proficient oral and written communication skills. Working closely with numbers, they should have a strong focus for attention to detail and the ability to analyze data. They should enjoy having organized methods for their work, balancing financial records and business transactions, and operating computerized systems and office equipment. Becoming an accounting technician in Alberta requires up to two years of on-the-job training or the completion of a college program in accounting, bookkeeping or a related field. In Alberta, a number of institutions offer accounting courses and programs, such as Northern Alberta Institute of Technology (NAIT) in Edmonton, or CDI College of Business, Technology and Healthcare in Calgary and Edmonton. Prospective students should investigate the suitability and reputation of training programs with employers before enrolling in a program. 85 Alberta Learning Information Service, www.alis.gov.ab.ca, OCCInfo, Alberta Occupational Profiles and Human Resources and Skills Development Canada, National Occupation Classification 2006. Alberta Employment, Immigration and Industry 78
Employment is available in both large and small organizations ranging from retail businesses and manufacturing firms to social service agencies that provide health, education or other social services. Progression to professional accounting occupations is possible with additional training. Accountants (NOC 1111) Accountants examine and analyze the accounting and financial records of individuals and establishments to ensure accuracy and compliance with accounting standards and procedures. They are responsible for designing and administering accounting and information systems that include records of assets, liabilities and business transactions. Their main duties include preparing budgets, tax returns and financial statements, analyzing financial information to assist in planning management policies and business strategies, providing personal and corporate income tax and estate planning services, and internal and external auditing services. Accountants should possess effective written and oral communication skills. They should have the ability to think analytically and enjoy developing innovative solutions to problems. They are also responsible for displaying high ethical standards in all of the services they provide. In Alberta, training to become an accountant involves a combination of related post-secondary education and practical experience. Most accounting designations require the completion of a bachelors degree, as well as the successful completion of a designation course and final exam. The Institute of Chartered Accountants of Alberta (ICCA), Society of Management Accountants of Alberta, or Certified General Accountants Association of Alberta can certify accountants, however professional designations have specific requirements that must be met and prospective students should consult these associations for further information. Accountants are employed across various industries in both public and private sector jobs, often working for businesses, governments, consulting firms, tax preparation offices, banks, and manufacturing companies. Experienced individuals who have professional accounting designations may advance to management positions or teach at the post-secondary level. Those in public accounting firms can move through the ranks of senior staff to become managers and partners. SUMMARY OF RECRUITMENT AND RETENTION ISSUES AND ADDITIONAL COMMENTS A number of survey respondents added comments and information of interest. A summary of questions and representative comments are captured here. Thirty-seven per cent of the companies surveyed said the labour shortage in Calgary is affecting their business. When asked, How has your organization been affected by the labour shortage in Calgary? the most common response was employee stress has increased. I have to have my wife helping me out right now. I am missing deadlines, I have upset clients, and I am trying to find someone with no luck. I am having to turn down business every day because I am so busy and it is stressful! I think we've all been keeping up with things, but it definitely has been a little more stressful for all. For awhile, it was pretty stressful! Thirteen companies said they have had to turn down business/clients and to go along with that, several companies reported service quality has decreased, customer complaints have increased, and they have not been able to expand their business. I just take whatever I can handle, but I am turning people away all the time. We have actually lost clients because the quality of our work has diminished. Alberta Employment, Immigration and Industry 79
We have been late, we have had to turn people away, and we are all working an awful lot. I have been in the business for a long time now, and I am older. I am not looking to grow my company any further, but if this was my goal, I think I would be in trouble. Some additional comments from companies that reported they have not been affected included: Being small, it is relatively easy to find a little extra help when I need it. This works for us (being a small company). We have never tried to expand, and we are quite happy with how things are, regardless of how much more work is out there now. My business personally has not been affected. Some of my clients are having a tough go of it, though. Employee referrals/word of mouth was by far the most common resource used to recruit employees in this industry, reported by 57 companies. The Calgary Herald and the Internet were the next most mentioned resources. We generally get a lot of referrals from others. We hire a lot of people that way. We will usually put an ad in one of the newspapers, but we will also try word of mouth - we have been in the business awhile. When I am looking to hire, I rely on my personal connections and business contacts first. Although we are family run, we do not just hire family members. We usually put ads on the JOB Bank. When asked, What skills or competencies are difficult to find when looking for new employees? the most common responses were relevant work experience and education/training. We need people with an accounting background. Finding someone with any type of training is horrendous. I recently hired someone with a business degree, and their spelling was awful, and they were unable to sort paperwork chronologically! I try to hire people with 3-5 years experience but that is difficult. It is difficult to find accountants with public practice experience. We don't have a lot of time to train people, so experience is a must. Computer skills and language skills were also reported as difficult to find by 13 and 9 companies respectively. Proper English skills are important but often difficult to find. You definitely need to be IT savvy. It is kind of a catch 22. We get applicants that have the qualifications, but their English is terrible, and we get applicants with good English skills, but they just aren t qualified. English skills are an issue. The last couple of temps I had, use of the English language was a barrier. I really had a hard time understanding the people and it made the job a lot more difficult. Computer skills are very important. Alberta Employment, Immigration and Industry 80
Eighty-four per cent of the companies surveyed said they provide some type of training to existing employees. Some additional comments related to training included: I am willing to train anyone and give them a chance. I will even pay them full employee wages during the 3-4 month training period. I just need someone willing to learn! It has been such a headache, I don't know if I will even bother to hire people who need training anymore. I provide lots of training. I train them, and I also send them to seminars and courses. We are actually associated with a training school. I would be happy to train, but so far I haven't met anyone worth training! When asked, What are the most effective methods your company uses to retain existing employees? the most common response was a good company culture, mentioned by 32 companies. We have a really great boss and a great work environment, and that makes it a lot easier to come to work everyday. This is a relaxed place to work. This is a great place to work. I have commuted here every day from High River for 9 years because I have such a great boss. I had enough of working for big corporations. This is a comfortable place to work, and we have all been here awhile. Flexible work measures and training/learning opportunities was reported as being effective retention methods by 26 and 12 companies respectively. I try to offer my staff a great deal of flexibility, as well as encouraging them to have the freedom to mingle and interact with clients. In many companies, this is a privilege only granted to partners. I try to give my employees a lot of time off. Business is cyclical. In the slow times, I am very lenient with vacations, and extended time off. Also, during the summer if it is a nice Friday afternoon, I will always let people off early if we aren't too busy. I offer complete training in all areas of accounting for small businesses. You can't get that kind of experience just anywhere, and people with that experience are in very high demand. They are very good at providing flexible work arrangements. Working here, you have the opportunity to learn accounting for a variety of businesses. Our boss is one of the most understanding people I have ever met. He knows that family comes first, and has been fantastic when I decided to have children and go to part time. I have worked here for 9 years now, and I told him that I have no idea what I would do if he were to retire. You would never find another job like this. We all get along really well here. I think most people stay because of the flexibility. It is really easy to take a vacation, or schedule a day off. Alberta Employment, Immigration and Industry 81
Finally, companies were given the opportunity to contribute any additional comments about recruitment and retention issues in their industry. We have had a lot of success with the McBride Career Group. It is a government-funded agency that helps landed immigrants find work, and it pays for our training expenses for 3 months. It is a win-win situation. It really helps everyone out. I would encourage anyone to go into this career. I turn down work all the time. People ask if I know anyone taking on new clients - I don't. I tell them to just keep calling and hoping. It's tough out there. I think having people work on contracts is a great solution because it completely takes out the stress and guesswork of staffing. Also, this is certainly a seasonal business. We are busy all year, but sometimes if it gets a little crazy, we can hire someone part-time on contract to help out. There are so few people looking for jobs in accounting today. There aren't enough people. I am even willing to hire someone who has only 60-70% of the requirements I ask for, but I can' t even find someone who has that. If the cost of labour wasn't so high, I could maybe afford to hire an assistant during the busy times. Alberta Employment, Immigration and Industry 82
LABOUR MARKET INFORMATION REVIEW This section captures information related to other labour market activities undertaken by the consultant during the reporting period. LABOUR MARKET NEWS HIGHLIGHTS The Calgary & Area Labour Market News, published monthly, provides current labour market information and analysis geared toward job seekers. Below are highlights of the July, August and September 2007 issues. The full articles are available on the Alberta Employment, Immigration and Industry website at http://www.employment.gov.ab.ca/cps/rde/xchg/hre/hs.xsl/2396.html VOLUME 9. ISSUE 7. JULY 2007 Teaching: Career choices beyond the classroom Being hired by a school board, and teaching in a classroom is just the tip of the iceberg when it comes to career choices for instructors. On soccer fields and in health centres, Calgary s burgeoning leisure sector is hiring sports coaches and fitness instructors. In addition, there are opportunities in continuing education, training and tutoring ideal for people with good teaching skills and with a talent or skill they want to share with students. Outside the classroom Teachers are at the heart of the school system. But their work would be impossible without the support and help of janitors, support staff and bus drivers. Learn about a few of the occupations in the school system outside the classroom in this article. VOLUME 9. ISSUE 8. AUGUST 2007 Writing career: a few keystrokes away There are plenty of career options for writers, but some are more reliable than others. Right now technical writers are in extremely short supply, and the pay is good. But becoming a journalist is another story. It may take much longer, and the pay can be minimal at the beginning of a career. Explore a few of the options available to aspiring writers in this article. Self-employment. Weighing the costs and benefits The attraction of being self-employed has enticed many, but starting your own business has costs and drawbacks. Pathways to print With the click of the print button, laser printers and desktop publishing was set to end the careers of many workers in the printing industry. But to the surprise of nearly everyone, the new technology has only expanded the market, and business is booming. Print shops are now short of staff for every stage of the printing process. VOLUME 9. ISSUE 9. SEPTEMBER 2007 Working in green: environmental careers Thousands of spent oil and gas wells are scattered across Alberta s landscape, and every one of them has to be cleaned up. The demand is a big part of the fertile environmental sector, which will need thousands of Alberta Employment, Immigration and Industry 83
new workers to cope with reclamation efforts, environmental assessments and the looming challenge of global warming. Many jobs will be for heavily credentialed professionals. Still, there will be plenty of opportunities for interesting work at the entry-level. Bridges to communication: Aboriginal consultants Nothing helps spur an industry like necessity. And Aboriginal consultants have become a critical part of the oil and gas sector. The career path has been around for decades helping to align corporate and community interests, but with land use conflicts on the rise, and the courts firmly behind Aboriginal rights, demand is surging for Aboriginal consultants. Reigniting an old tradition: mentoring in the workplace Officially, it s a rarity. Unofficially, mentoring in the workplace is alive and well even in organizations that no longer have the time and energy to develop standardized practices or procedures. Offering a mix of friendship and coaching, mentoring helps pass on knowledge, and perhaps more importantly, enthusiasm. EMPLOYER LABOUR MARKET NEWS HIGHLIGHTS The Calgary & Area Employer Labour Market News, published bi-monthly, is geared toward employers, business and industry. Below are highlights of the July and September 2007 issues. The full articles are available on the Alberta Employment, Immigration and Industry website at http://www.employment.gov.ab.ca/cps/rde/xchg/hre/hs.xsl/2397.html VOLUME 2. ISSUE 4. JULY 2007 Putting the pieces together: managing a multigenerational workforce For the first time in history, managers will have to contend with the tangled web of needs from four separate generations. Each has their own set of priorities, and desires. This article takes a closer look at what makes each generation tick and how to better engage a diverse workforce. Best Practice: Enmax Find out how one company, Enmax, matches policy and practice to a changing demographic. Featured Organization: Vibrant Communities Calgary Vibrant Communities slogan catches the essence of the organization: for a city to be truly great, it must be great for everyone. To reach that goal, VCC is working with communities, industry and government to find practical solutions to poverty s root causes. LMI Stats: Productivity: getting more for less There are two solutions to a labour shortage get more staff, or get more productive. This article takes a look at the sometimes forgotten second idea. VOLUME 2. ISSUE 5. SEPTEMBER 2007 Bringing new workers to your small business When trying to attract and retain workers, small businesses face different obstacles than their larger competitors. But it is possible to compete in the labour market by using correctly targeted job ad content and placement, and effective retention strategies. Alberta Employment, Immigration and Industry 84
Best Practice: Purolator Courier Ltd. Purolator Courier Ltd. is one example of a company that has taken the problem of attraction and retention by the horns. The company has moved to better position itself with newcomers to Canada, and is making an extensive effort to assess its own performance. Community engagement programs also help to give workers a sense of pride in their company. Featured Association: Sparking interest in the trades The Youth in Transition to Apprenticeship Project is a new pilot project targeting youth ages 18-30 not currently involved in any other existing educational support program. The project works as any job search, except youth are matched to employers to hire them as an apprentice. So far the project has been a success, with 93 per cent of new tradespeople from the program finding work and staying employed. LMI Stats: Hiring new immigrants can help build your business Over 20 per cent of Calgary s population is made up of immigrants making this demographic a critical piece of any solution to the current labour crunch. A new study, Statistics Canada s Canadian Social Trend, informs employers of the problems facing immigrants when it comes to employment, and points them towards some of the solutions. Tips for Employers: Strategy for a vibrant and skilled workforce The Alberta Government has commissioned a series of Workforce Strategies to help individual sectors of the economy cope with the labour crunch. The strategies are developed by industry and facilitated by the provincial government. So far, the retail, tourism and hospitality, energy and manufacturing industries have released their strategies. Release of the Construction Strategy is planned for September 2007. JOB AD ANALYSIS Beginning in March 2007, the Calgary Labour Market News bulletin took a different approach to the job ad analysis. The categories for industry and occupation were changed to match the North American Industry Classification System (NAICS) and National Occupation Code (NOC). The following sources have been analyzed since March 2007: Calgary Herald Working section: job postings every Saturday in March 2007 Workopolis.com website: job postings every Thursday in April 2007 Calgary Sun Classified section: job postings every Friday in May 2007 JOB Bank website: job postings every Friday in June 2007 Calgary Herald Classified section: job postings every Friday in July 2007 Monster.ca website: job postings every Friday in August 2007 SUMMARY OF JOB POSTINGS From March August 2007, close to 7,200 jobs have been included in the analysis and reported on. 86 It should be noted that the volume of ads reported here is not necessarily indicative of the volume of postings available on a regular basis for several reasons, including that only one day per week for each source was scanned for ads. 86 Not all job postings have been included in the analysis due to limited information on the job in the posting. Alberta Employment, Immigration and Industry 85
Figure 30: Job Ad Postings by Source Job Ads by Source Over half of the listings were from the classified ads (Sun Classifieds 38 per cent and Herald Classifieds 26 per cent). The Calgary Sun classifieds section in May 2007 was dominated by employment ads from the Construction, Transportation and Warehousing, Other Services and Accommodation and Food Services industries. Together, these industries represented 73 per cent of the 2,658 ads analyzed in May. The Calgary Herald classifieds section in July 2007 was dominated by employment ads from the Construction, Health Care and Social Assistance, Retail Trade and Accommodation and Food Services industries. Together, these industries represented 67 per cent of the 1,466 ads analyzed in July. The JOB Bank in June 2007 was focused mainly on jobs from the Accommodation and Food Services industry, as well as the Administrative, Waste Management and Remediation Services, Construction, and Retail Trade industries. Monster.ca was also dominated by ads from the Retail Trade industry, representing close to one-quarter of the 562 ads analyzed in August 2007. The Calgary Herald Working section and Workopolis.com represented the remaining 14 per cent (7 per cent each) of the total ads analyzed from March August 2007. The Calgary Herald Working section was dominated by ads from the Mining and Oil and Gas Extraction industry, while over one-quarter of the ads posted to Workopolis.com were from the Professional, Scientific and Technical Services industry. Alberta Employment, Immigration and Industry 86