With a skyline full of cranes, streets throughout the region under repair and tourists starting to fill the Inner Harbour, Greater Victoria’s workforce is bustling.
Statistics Canada confirmed as much Friday as it released figures showing Victoria has the lowest unemployment rate in the country at 3.7 per cent, an improvement over the 3.8 per cent recorded in March and a significant drop from the 6.1 per cent in April last year.
That low unemployment rate was not a record. Victoria recorded a low of 2.8 per cent in May of 2008.
“We have had the lowest unemployment rate in the country since the middle of last year,” said Catherine Holt, chief executive of the Greater Victoria Chamber of Commerce. “That is due to a number of factors that aligned — our low dollar attracting more tourists and creating demand for our exports, a poor economy in Alberta driving workers to look for work here, our growing reputation as a high tech hub, real estate values leading to more construction and balanced provincial budgets meaning stability for our public sector employers.”
Statistics Canada said while Victoria’s labour force grew by 8,000 people to 199,700 over the last 12 months, the city’s main industries found places for almost all of them. The number of employed in the region is now 192,400, up from 180,000 in April 2016.
Statistics Canada spokesman Vincent Ferrao said construction has led the way in the region, adding 5,400 positions since last year for a total of 16,100 employed. Other sectors seeing significant growth since last year were health care, manufacturing and public administration.
Casey Edge, executive director of the Victoria Residential Builders Association, said companies are starting to feel the pinch because the construction sector is so busy.
“We’ve encountered a challenging situation in terms of skilled trades and that has been the case whenever the construction industry ramps up, as it has been the last two years,” he said. “And with that comes rising costs.
“During the boom years from 2001 to 2007 keeping trades was challenging and the costs were rising significantly.”
The tech sector, which employs 15,000 people directly and another 8,000 people who are either consultants or work in tech jobs within large organizations, is facing a similar situation. “Every company I talk to seems to have added 25 per cent or more to their team in the last 18 months and all of them say they have intentions of adding considerably more,” said Dan Gunn, chief executive of the Victoria Innovation, Advanced Technology and Entrepreneurship Council. “There is a lot of hiring going on in the tech sector and a lot more to come.
“It’s a healthy sector. They need people because they have markets that want their products so they need to scale up when the opportunity and demand is there.”
But Holt points out economic trends tend to by cyclical and eventually the growth and employment will start to slow down.
“The forecasts I’ve seen for 2017 are for more modest growth than last year. Our active economy creates jobs and attracts workers, but housing prices and availability and traffic snarls put a damper on their ability to stay here,” she said.
“The chill on travel created by the U.S. government affects our tourism. The softwood tariff is likely to reduce demand for our forest products. The tight real estate market is discouraging people from selling their homes in case they can't find a replacement. And the economy in Alberta is picking up.
“So things are likely to cool off a bit this year, which should help alleviate our labour shortages.”
The employment situation across Canada last month was also rosy, as the national unemployment rate fell to 6.5 per cent.
However, according to Statistics Canada a record-low for wage growth cast a shadow over the good news.
“Typically, you would say we actually have relatively tight labour markets, but it’s just not generating wage growth. So, I think that wage measure is the main one that’s going to keep giving the Bank of Canada pause, and it gives us pause as well,” said RBC senior economist Nathan Janzen.
Hourly wages for all employees expanded by 0.7 per cent in April, the slowest year-over-year growth since the federal agency started collecting that data in January 1997. For all permanent employees, wages expanded compared to a year ago by just 0.5 per cent — also an all-time low.
Janzen said wage growth is an important indicator, particularly for the Bank of Canada as it mulls interest-rate decisions. The data points to households’ purchasing power and the health of their monthly income statements.