The labor market showed signs of easing pressure in the third quarter of 2024, as the rate of job vacancies continued its downward trend. New data reveals a reduction of 31,900 job vacancies, a 5.5% decline from the previous quarter, leaving 546,100 vacant positions across the country. While it marks the ninth consecutive quarterly drop, the decline is notably smaller than the 63,200 job vacancies lost in the second quarter, signaling a potential stabilization in Canada’s job market.
Despite this slow down in the overall vacancy rate, the numbers remain starkly lower compared to the same period last year. Across various sectors, job vacancies fell for both permanent and temporary positions, impacting full-time and part-time roles alike. Specifically, permanent job vacancies shrank by 27,800 (-5.9%), while temporary roles dropped by 4,100 (-4.0%). Full-time jobs saw a decrease of 19,300 (-4.5%), while part-time positions were down by 12,600 (-8.5%).
The job vacancy rate—the proportion of vacant positions relative to total labor demand—also continued its decline, dropping by 0.1 percentage points to 3.1%. This marks the continuation of a trend that began in the second quarter of 2022, when the job vacancy rate peaked at a record-high 5.6%. With the job market now more balanced, labor demand remained mostly unchanged for the fourth consecutive quarter, standing at a negligible 0.1% lower than the previous year.
However, the decrease in vacancies is not without its consequences for the unemployed. The unemployment-to-job vacancy ratio, which measures the number of jobless individuals per open position, has steadily increased. The ratio climbed from 2.0 in early 2024 to 2.6 in the third quarter, indicating that more individuals are now vying for each available job.
The decline in job vacancies was not uniform across Canada’s regions. Ontario, the country’s most populous province, experienced the largest drop, with job vacancies falling by 16,500 to 184,400. The greater Toronto area accounted for a significant portion of this decrease, with vacancies dropping by 5,900 to 91,500. Similarly, Quebec saw a reduction of 5,900 positions to 121,300 vacancies. Conversely, certain regions in Quebec saw slight increases, including Laval and parts of the Gaspé Peninsula, suggesting some localized variations in labor demand.
Occupationally, the largest declines were observed in sales and service occupations, which accounted for a significant portion of the total job losses. This sector has been hit hard, with job vacancies falling for the eighth consecutive quarter, down by 12,500 (-7.4%) to 155,300 positions. Despite this decline, sales and service positions continue to make up the largest share of job vacancies, representing nearly 30% of the total. Food counter attendants, retail salespersons, and cooks were some of the hardest-hit roles within this group, marking significant year-over-year decreases in vacancy numbers.
In addition to sales and service, the trades, transport, and equipment operators sector experienced a marked decrease of 6,900 positions, bringing the total number of vacancies to 98,400.
The health sector also saw its second consecutive quarterly decline, as vacancies in health occupations fell by 8,200 (-9.5%) to 78,600.
While vacancies are on the decline, wage growth appears to be accelerating. The average offered hourly wage for vacant positions grew by 7.6% year-over-year in the third quarter, reaching $27.55. This marks an increase from previous quarters, signaling that employers may be offering higher wages in an attempt to fill increasingly scarce roles. The increase is attributed in part to a shift toward higher-paying occupations within the vacancy pool.
The wage trend is not uniform across all regions. Provinces like British Columbia and Ontario, which have seen stronger economic recovery, report higher wage growth compared to more rural areas, where wages have remained more stagnant. Still, the overall increase in wages underscores an ongoing shift in the labor market toward higher-skilled, higher-paying roles, as employers compete for a shrinking pool of qualified candidates.
Another significant trend is the decrease in vacancies for lower-skilled positions, especially those requiring only a high school diploma or less. Vacancies in this category fell by 118,900 (-28.7%), with sales and service occupations accounting for a large portion of the decline.
As the Canadian economy continues to adjust to changing global conditions, the future of job vacancies remains uncertain. The decline in vacancies, though slowing, signals potential challenges ahead for both employers and job seekers. With a higher unemployment-to-job vacancy ratio, it is clear that competition for available roles will intensify. At the same time, the rising wages may help ease some of the pressure, particularly in higher-skilled occupations.
In the coming months, all eyes will be on how the trends evolve. While the slower pace of decline in job vacancies may offer a glimpse of stabilization, the challenges faced by both employers and workers are far from over.