The 2019 Hays Canada Salary Guide is predicting a “hiring frenzy” in the coming year.
The ninth annual poll, released at the beginning of December, says Canadian employers are planning to hire permanent staff in the coming year but it also indicates job market pressure will increase. Employer confidence in the economy is high for 2019 with 47 per cent predicting the economy to remain as strong as 2018 and business activity expected to increase 63 per cent, the poll states.
“The overall findings of what 2019 has ahead for us is that about 50 per cent of employers are very confident in the economy and they think it’s going to stay strong next year,” said Jim Fearon, Hays Canada vice-president for Central and Western Canada.
“The construction and property industry, in particular, is saying that 52 per cent of employers are planning on increasing their permanent headcount next year in response to that level of business activity. About 30 per cent of them are saying they are going to need to augment their workforce with an increasing volume of contractors and temporary employees. Basically, it’s looking very good and they’re off of the back of similar figures from last year.”
While more than half of those surveyed (52 per cent) are intending to hire permanent staff in the new year to make up for the previous year, less than a quarter (24 per cent) plan to give salary raises greater than three per cent. According to the poll, employers have chosen instead to boost salary offers to entice new candidates.
Twenty-eight per cent of construction employers say they plan to increase contract staff in 2019 to bridge the skills gap.
If there are that many people who are looking for a pay rise, you could start to see a bit of a hiring frenzy
— Jim Fearon
“Despite the extreme skills shortage and the fact that employers are looking to hire more people, no one is really looking to offer any significant salary increases this year,” Fearon noted.
“The thing we are surprised about is that the companies that are only offering their existing staff inflationary level pay rises, they are prepared to break their own salary rules to bring people into the organization from outside. That has the potential to cause them all sorts of problems because we know that when that information gets discovered by existing staff, that can have some pretty catastrophic effects. People will tend to go looking for work.”
About 82 per cent of employers are experiencing a moderate to extremes skills shortage, which is negatively affecting productivity, staying competitive, profit, workplace stress and pressure, increasing inefficiencies and retention.
“If you’re trying to get maximum productivity out of your business with a gross skills shortage, as is being reported with virtually all organizations in all parts of the market, then you have to get more out of your existing staff which simply means they have tougher deadlines, they have more to get done in the same working days they normally have,” said Fearon.
“That means they’re experiencing highly elevated levels of stress and pressure. It also means that rather than getting maximum productivity you end up losing efficiency because you simply can’t get the same amount done with fewer people.”
That also has an impact on retention.
“If people feel they are being overworked, underpaid and they are extremely stressed in their jobs then they have a way higher chance of going to look for a better package elsewhere,” said Fearon.
According to a construction hiring insights webinar issued by Hays, 30 per cent of construction professionals would leave their current role for a bigger paycheque and 68 per cent of employers have increased salaries outside their budget to recruit a specific candidate with specific talent. Employees have the upper hand in the current job market, Fearon noted.
“There has been this thing going on for a number of years now where there has been inflationary level pay increases. The economy in the construction market in Canada has been excellent for a very long period of time and we think what we’re going to see is that people are going to start feeling that they are now due a step up in salary and they’re going to start looking for it,” said Fearon.
“If there are that many people who are looking for a pay rise, you could start to see a bit of a hiring frenzy…companies will have to compete more aggressively to retain their staff by counteroffering to employees to try and keep them.”