1. A 10-year Outlook for the Canadian Labour Market (Canadian Occupational Projection System 2009 Reference Projection) The Labour Force of the Future and Imbalances between Job Demand and Worker Supply Policy Research Directorate, Strategic Policy and Research Branch

2. 2 Overview  Presentation on Labour Demand: Key Conclusions  Labour Supply –Labour Force –School Leavers –Immigration  Imbalances –by Broad Skill Level –by Occupation –Mismatch between Field of Study and Occupation

3. 3 Presentation on Labour Demand:

4. 4 Source: Policy Research Directorate, HRSDC (Reference Scenario 2009). * Other Replacement Demand Includes Deaths and Emigration Job Openings from Expansion Demand and Replacement Demand, 1996-2018 Retirements will account for most of the job openings

5. 5 Source: Policy Research Directorate, HRSDC (Reference Scenario 2009). Two-thirds of all job openings will be in occupations usually requiring PSE or in management occupations Job Openings from Expansion Demand and Replacement Demand by Skill Level, (2009-2018) Thousands

6. 6 Labour Supply

7. 7 Labour force growth is projected to slow over the next decade Growth of Labour Force 15+ (Non-Student), 1999-2018 Sources: Statistics Canada and Policy Research Directorate, HRSDC (Reference Scenario 2009). Thousands (%)

8. 8 Labour force growth is projected to slow over the next decade Growth of Labour Force 15+ (Non-Student), 1999-2017 Sources: Statistics Canada and Policy Research Directorate, HRSDC (Reference Scenario 2008). Thousands (%)

9. 9 Population 15+ (Non-student): Annual Growth Rate, 1999-2018 Forecast 10-Year Outlook for the Canadian Labour Market Population growth will be somewhat slower Sources: Statistics Canada and Policy Research Directorate, HRSDC (Reference Scenario 2009). Average growth rate over 1999-2008: 1.40% Average growth rate over 2009-2018: 1.17%

10. 10 Labour force participation rates by age group are projected to increase further Labour Force Participation Rates for Age Groups 25-54 and 55-64, 1990-2018 (%) Forecast 55-64 25-54 Sources: Statistics Canada and Policy Research Directorate, HRSDC (Reference Scenario 2009).

11. 11 Share of Age Group 55+ in Total Population (Non-Student), 1990-2018 Forecast 10-Year Outlook for the Canadian Labour Market Nevertheless, rapid increases in the share of 55+ population will pull down the aggregate participation rate Sources: Statistics Canada and Policy Research Directorate, HRSDC (Reference Scenario 2009).

12. 12 Males Total Females Labour Force Participation Rate, Total and by Gender (15+, Non-Student), 1976-2018 (%) Forecast 10-Year Outlook for the Canadian Labour Market Sources: Statistics Canada and Policy Research Directorate, HRSDC (Reference Scenario 2009). Due to population aging, the aggregate labour force participation rate will start to decline in the next few years

13. 13 Employment Replacement Demand: - Retirements - Emigrants - Deaths Demographic and Macroeconomic Projections Future Labour Market Imbalances by Occupation Labour demand versus labour supply by occupation Job Seekers: - School leavers - Immigrants - Net reentrants Labour Force Future Labour Market Imbalances by Broad Skill Level Change in employment versus change in labour force by broad skill level Expansion Demand Net Mobility Labour Demand Labour Supply outflowsinflows intra-flows Projection Models - Structure

14. 14 2009-2018 Population 15-29 (right axis) Share of population 15-29 (left axis) Youth population (15-29) will increase in the next decade, thus more youth are expected to enter the labour market Population 15-29 in ‘000s and as a Share of Total Population: 1971-2018 Sources: Statistics Canada and Policy Research Directorate, HRSDC (Reference Scenario 2009). 1999-2008 Average youth population: 6.77M Average youth population: 6.49M

15. 15 Projection Ba. and First professional (Left Axis) Master’s (Left Axis) PhD (Right Axis) College (left Axis) Most youth entering the labour market will come from PSE programs as the enrolment rate will trend up Sources: Statistics Canada and Policy Research Directorate, HRSDC (Reference Scenario 2009). Enrolment Rates in University Programs as a Percentage of Source Population, 1991- 2018

16. 16 The recession is expected to have a positive impact on enrolments in PSE programs First-Year Enrolments in Postsecondary Education: Impact of Recession Projection Colleges: Recession Colleges: No Recession University: Recession University: No Recession Sources: Statistics Canada and Policy Research Directorate, HRSDC (Reference Scenario 2009). Double cohort Recession

17. 17 Students who enrolled during the recession will enter the labour market during the economic recovery School Leavers from Postsecondary Education: Impact of Recession Projection College_Recession College_No Recession University_Recession University_No Recession Sources: Statistics Canada and Policy Research Directorate, HRSDC (Reference Scenario 2009). Recession

18. 18 The number of school leavers with less than high school is projected to decline by a third over the next 10 years School Leavers with Less than High School Education, 1990-2018 Projection Double cohort Population 14-18 Reference 2009 Sources: Statistics Canada and Policy Research Directorate, HRSDC (Reference Scenario 2009). Population 14-18, ‘000s

19. 19 Sources: Statistics Canada and Policy Research Directorate, HRSDC (Reference Scenario 2009) The high school dropout rate is also projected to resume a downward trend High School Dropouts, 1975-2018 Projection

20. 20 The number of school leavers with a high school degree is projected to increase marginally over the next ten years School Leavers with a High School Degree Only, 1990-2018 Projection Population 18-24 Reference 2009 Sources: Statistics Canada and Policy Research Directorate, HRSDC (Reference Scenario 2009). Double cohort Population 18-24, ‘000s

21. 21 The number of school leavers with a college degree is projected to increase by 15% over the next ten years School Leavers with a College Degree, 1990-2018 Sources: Statistics Canada and Policy Research Directorate, HRSDC (Reference Scenario 2009). Projection Reference 2009 Population 18-24 Double cohort Population 18-24, ‘000s

22. 22 The number of school leavers with a university degree is projected to increase by 15% over the next ten years School Leavers with a University Degree, 1990-2018 Sources: Statistics Canada and Policy Research Directorate, HRSDC (Reference Scenario 2009). Projection Reference 2009 Population 20-29 Double cohort Population 20-29, ‘000s

23. 23 The share of school leavers with a postsecondary education will increase over the next ten years School Leavers by Education Level, 1999-2008 and 2009-2018 1999-2008 2009-2018 Sources: Statistics Canada and Policy Research Directorate, HRSDC (Reference Scenario 2009). 33.3% 31.6% 66.7% 69.4%

24. 24 Projection Share of the Labour Force (Non-Student) with Postsecondary Education by Age Group, 1990-2018 Sources: Statistics Canada and Policy Research Directorate, HRSDC (Reference Scenario 2009). The younger cohorts entering the labour market are more educated than the older ones but the gap is narrowing

25. 25 Share of Labour Force (25+, Non-Student) with a Postsecondary Education, 1990-2018 Projection 10-Year Outlook for the Canadian Labour Market Sources: Statistics Canada and Policy Research Directorate, HRSDC (Reference Scenario 2009). As a result, the level of educational attainment of Canada’s labour force will continue to rise, but at a slower pace

26. 26 10-Year Outlook for the Canadian Labour Market Immigration will play a smaller role than school leavers as a source of new job seekers Projection Sources: Statistics Canada and Policy Research Directorate, HRSDC (Reference Scenario 2009). Sources of New Job Seekers: School Leavers and Immigration (15+, Non-Student) 1997- 2018

27. 27 2001 2006 34.7% 65.3% 26.3% 73.7% An increasing share of new immigrants in the labour force have postsecondary education Recent Immigrants (last 5 years) by Education Level, 2001 and 2006 Sources: Statistics Canada, Census 2001 and 2006.

28. 28 The match between the level of education and the skill level usually required by employers is not perfect Proportion of the Labour Force with a Given Level of Education by Skill Level, Amongst Population 25-29, 2008 Sources: Statistics Canada and Policy Research Directorate, HRSDC (Reference Scenario 2009).

29. 29 Sources: Statistics Canada and Policy Research Directorate, HRSDC (Reference Scenario 2009). Over six in ten job seekers will offer their services in high- skill occupations over the next ten years Job Seekers by Skill Level, 2009-2018 10.9% 21.5% 29.7% 30.0% 7.9%

30. 30 Imbalances

31. 31 There is limited evidence of imbalances between demand and supply by broad skill level in recent decades Relative Unemployment Rates (left chart) and Relative Wages (right chart) by Skill Level Sources: Statistics Canada, Labour Force Survey

32. 32 Source: Policy Research Directorate, HRSDC (Reference Scenario 2009). 10-Year Outlook for the Canadian Labour Market Small gaps between demand and supply by skill level over the medium term but recession leads to excess supply conditions in the short run Job Openings and Job Seekers by Skill Level, as a Percentage of 2008 Employment, Outlook for the Next Two Years (2009-2010) and Ten Years (2009-2018) 2009-2010 2009-2018 Projection Periods Management Occupations Usually Requiring College or Apprenticeship Job Openings in Excess of Job Seekers Occupations Usually Requiring On-the-Job Training Occupations Usually Requiring University Occupations Usually Requiring High School Management Occupations Usually Requiring College or Apprenticeship Job Openings in Excess of Job Seekers Job Seekers in Excess of Job Openings

33. 33 10-Year Outlook for the Canadian Labour Market However, in the medium term, several occupations will be facing shortage or surplus conditions Job Seekers and Job Openings by Occupation (3-digit), as % of 2008 Employment, Ex-Post Scenario Source: Policy Research Directorate, HRSDC (Reference Scenario 2009). Excess supply Excess demand In balance

34. 34 An increasing share of the labour force with PSE will fill very low-skilled jobs Proportion of the Labour Force by Level of Education in Occupations Requiring On-the- Job Training, 1998, 2008 and 2018 Sources: Statistics Canada and Policy Research Directorate, HRSDC (Reference Scenario 2009).

35. 35 Sources: Statistics Canada and Policy Research Directorate, HRSDC (Reference Scenario 2009). More supply in high-skilled occupations when school leavers look for jobs related to their fields of study Job Seekers by Skill Level, 2009-2018

36. 36 10-Year Outlook for the Canadian Labour Market In general, imbalances become more pronounced when school leavers look for jobs in occupations more related to their fields of study Job Seekers and Job Openings by Occupation (3-digit), as % of 2008 Employment, Ex-Ante Scenario Source: Policy Research Directorate, HRSDC (Reference Scenario 2009).

37. 37 The case of nurse supervisors and registered nurses Job Openings and Job Seekers over 2009-2018 Under Two Scenarios for School Leavers – Nurse Supervisors and Registered Nurses Immigration School leavers Mobility Others Mobility Immigration School leavers Emigration Deaths Retirements Expansion Demand Source: Policy Research Directorate, HRSDC (Reference Scenario 2009).

38. 38 The case of life science professionals Immigration Expansion demand Others Immigration School leavers Retirements Deaths Emigration School leavers Job Openings and Job Seekers over 2009-2018 Under Two Scenarios for School Leavers – Life Science Professionals Source: Policy Research Directorate, HRSDC (Reference Scenario 2009). Excess Supply Ex post: -900 Ex ante: -9,400

39. 39 123456789 BUS, FIN & ADMIN NATUR & APPLIED SCIENCEHEALTHSOCIAL SCI, EDU, GOV’T SERV & RELIGION ART, CULTU, RECR & SPORT SALES & SERV TRADES, TRANSP AND EQUI PRIMARY INDU PROCESS MANU & UTIL MANAG. Senior Management N010 LEVEL A university 11 - Prof in Business & Finance 21 - Prof in Natural / Applied Sciences 31 - Prof in Health 41 - Prof in Social Sci / Edu / Gov't Serv / Religion 51 - Prof in Art & Culture LEVEL B college or apprentic 12 - Skilled Admin & Business 22 - Techl Occ's Related to Natural / Applied Sciences 32 - Tech / Skilled Occs in Health 42 - Paraprof Occ's in Law / Social Services / Education / Religion 52 - Tech / Skilled Occ's in Art / Culture / Recr / Sport 62 - Skilled Sales & Service Occs 72-73 - Trades & Skilled Transp & Equip Operators 82 - Skilled Occ's in Primary Industry 92 - Process / Manu / Utilities Supervisors & Skilled Operators LEVEL C high school 14 - Clerical Occs 34 - Assisting Occ's in Support of Health Services 64 - Intermediat e Sales & Service Occ’s 74 - Intermediat e Occ's in Transp / Equip Operation / Install / Maintenanc 84 - Intermed Occ's in Primary Industry 94-95 - Process & Manu Machine Operators & Assemble LEVEL D on-the- job training 66 - Elemental Sales & Service Occ’s 76 - Trades Helpers, Constructio n Labourers & Related Occ's 86 - Primary Industry Labourers 96 - Labourer in Process, Manu & Utilities green: Similar actual and potential supply yellow: Small potential supply red: Large potential supply Differences/Gaps Between Actual and Potential Supply, 2009-18 Source: Policy Research Directorate, HRSDC (Reference Scenario 2009).

40. 40 Projected shortage conditions over the next 10 years are found mostly in high-skilled occupations Skill TypesOccupations Projected to Face EXCESS DEMAND Conditions Business, Finance, Administration Human Resources and Business Service Professionals (NOC 112) Natural and Applied Sciences Managers in engineering, architecture, science and information systems (NOC 021); Inspectors in public and environmental health and occupational health and safety (NOC 2263); Construction Inspectors (NOC 2264) Health Manager in Health, Education, Social and Community Services (NOC 031) ; Physicians, dentists and veterinarians (NOC 311); Optometrists, chiropractors and other health diagnosing and treating professionals (NOC 312); Pharmacists (NOC 3131); Nurse supervisors and registered nurses (NOC 315); Medical Laboratory Technicians (NOC 3212); Medical radiation technologists (NOC 3215); Dental Hygienists and Dental Therapists (NOC 3222) Social Science, Education, Government Service and Religion Manager in Public Administration (NOC 041) Trades, Transport and Equipment Operators and Related Occupations Managers in Construction and Transportation (NOC 071);Facility operation and maintenance managers (NOC 072); Contractors and supervisors, trades and related workers such as electrical trades and mechanic trades (NOC 721); Industrial electricians (NOC 7242); Aircraft Mechanics and Aircraft Inspectors (NOC 7315) Occupations Unique to Processing, Manufacturing and Utilities Aircraft Assemblers and Aircraft Assembly Inspectors (NOC 9481) Source: Policy Research Directorate, HRSDC (Reference Scenario 2009).

41. 41 Source: Policy Research Directorate, HRSDC (Reference Scenario 2009). In those occupations that will be facing shortage conditions, increasing supply to meet demand pose significant challenges Excess Job Openings Versus New Labour Market Entrants from the School System and Immigration for Selected Non-Management Occupations, 2009-2018

42. 42 Projected surplus conditions over the next 10 years are found mostly in low-skilled occupations Skill TypesOccupations Projected to Face EXCESS SUPPLY Conditions Trades, Transport and Equipment Tool and Die Makers (NOC 7232). Occupations Unique to Primary Industry Supervisors, Logging and Forestry (NOC 821); Logging Machinery Operators (NOC 8241); Fishing Vessel Skippers and Fishermen/women (NOC 8262); Nursery and Greenhouse Workers (NOC 8432). Occupations Unique to Processing, Manufacturing and Utilities Machine Operators and Related Workers in Pulp and Paper Production and Wood Processing (NOC 943); Machine Operators and Related Workers in Fabric, Fur and Leather Products Manufacturing (NOC 945); Motor Vehicle Assemblers, Inspectors and Testers (NOC 948); Machining, Metalworking, Woodworking and Related Machine Operators (NOC 951); Labourers in Processing, Manufacturing and Utilities (NOC 961). Source: Policy Research Directorate, HRSDC (Reference Scenario 2009).

43. 43  Labour force growth will slow mostly due to population ageing;  The main source of supply will remain the school leavers who will be positively impacted by: –The increase in youth population; –Enrolment rates on the rise.  New immigrants will only represent a small share of job seekers.  Only small imbalances will occur by broad skill level.  However, several occupations, will face excess demand (mostly high- skilled) or excess supply (mostly low-skilled); –A better match between supply and demand could be achieved by: Better labour market information Better skills recognition for immigrants A more responsive postsecondary system 10-Year Outlook for the Canadian Labour Market Key messages: Over the next ten years…