Ensuring workforce demand can be met across the spectrum of industries/occupations
The intrepid sleuths at AllNovaScotia.com are reporting that Amazon is looking at putting a large warehouse in Nova Scotia - potentially hundreds of thousands of square feet and 1,000-1,500 jobs (based on similar facilities elsewhere).
It’s unclear to me how much of this would be net new jobs. Of course, Amazon right now uses multiple fulfilment companies ranging from the mother ship in Canada (Canada Post) to little startup companies with 15-20 drivers.
The company will face workforce challenges, or at least will put significant pressure on the sector overall . Nova Scotia has the highest job vacancy rate in the transportation and warehousing sector among all provinces east of Manitoba (as of Q3 2021). There were over 1,000 unfilled positions in Q3 up by double since before the pandemic.
Amazon seems to have a strategy to pay modestly above market rates and then raid from other warehouses but that just puts pressure elsewhere. The average wage on offer in the sector in Nova Scotia is now $21.50/hour.
I know some of you like to poo poo on these kinds of jobs. You like the sexy stuff - IT, engineering, etc. - highly skilled professional jobs. But a strong economy is one that can address workforce demand across the spectrum. What benefit it is to the regional economy if companies are servicing this region from Montreal or even Toronto? Until recently, Walmart didn’t have a warehouse at all in Atlantic Canada.
I’m a bit concerned that Atlantic Canada risks becoming northern Canada - where a lot of economic opportunity is lost because there is no one to work the jobs. Consider the following chart. It shows the increase or decrease in the number of people reporting $35,000 in annual income to CRA between 2009 and 2019 - for all age groups and then for those under the age of 25 (these are not inflation adjusted). You can see in Toronto the number is actually up - among those aged 25 and under up a robust 13%.
Compare that to just about everywhere in Atlantic Canada (exception PEI, take note). With the exception of a few like Fredericton, Halifax and Moncton there has been a steep decline in the number reporting $35,000 or less income over the decade.
Again, some of you will say ‘good riddance’ we didn’t want those jobs anyway.
OK. But how far are you willing to push that?
The better strategy is to think about labour markets holistically. How do we ensure there is supply to match demand across the economy. If there are sectors or occupations where wages are low, then they should adjust but if there is a systemic lack of workers, paying more won’t do much.
Where do we find workers for these mostly services-based industries?
We need more students - not less - in the workforce. If you have a rural college campus - encourage those students to work - bring in more - to bolster the talent pipeline but also as a source of workers. Encourage high school students to work part time jobs as long as they can keep up their grades.
Encourage and incentivize 65+ folks to stay in the workforce. Many would like a part time job in a service industry.
Immigrants/spousal employment is another big option. $35K as the second income in a two-income household can be important - especially if child care costs are limited.
TFWs could be another option.
Encourage a lot more self-employment. It’s one thing to work as a motel cleaner in the summer. It’s another to have a small janitorial cleaning company with a couple of students working for you.
If we don’t do something, we will continue to hollow out the economies of our smaller towns and rural areas first and then in the cities too.