Why does Calgary have the highest rate of unemployment of all major Canadian cities?

why does calgary have the highest rate of unemployment of all major canadian cities?

In February, Calgary’s unemployment rate was 6.6 per cent — the exact same as the month before.

With a growing economy and a labour shortage, the province is renewing its Alberta is Calling campaign to attract workers to fill job vacancies in high-demand sectors, including skilled trades, health care, accounting, engineering, technology and the service and tourism sector.

But, paradoxically, Calgary’s unemployment rate is the highest of all major Canadian cities — sitting at 6.6 per cent.

Since last August, the city has been experiencing steady job losses. In six months, 30,600 positions were eliminated in Calgary, while Edmonton gained 27,700 and Montreal added 71,400.

So, what’s behind the high unemployment in the province’s economic capital — and why is there a labour shortage and a high unemployment rate at the same time?

Janet Lane, economic specialist at the Canada West Foundation, says the answer is simple: in many cases, Calgary isn’t attracting the right type of employees.

Of 103,000 job vacancies in Alberta last September, two-thirds, or about 70,000, required a high school diploma or less, she says. But Calgary has a very high rate of people with post-secondary educations.

“It’s a skills mismatch — that is the biggest problem,” said Lane.

She says the province’s advertising campaign may not be helpful to solve the labour shortage. The hospitality, construction and warehousing industries are facing big shortages, she says, but the people the campaign is targeting have enough jobs where they live already, and likely won’t choose to move here.

“We may end up with more people here, but they may still not be the people that we’re looking for to fill jobs.”

She says the first step to solving the problem is training for these in-demand jobs.

Lane also partially blames layoffs from years ago in the oil and gas sector. Now, she says, there aren’t as many jobs as there used to be.

“We still have people who were employed in very high paying jobs in that sector who have not found work that is equivalent to what they were doing, and in some cases they’re still unemployed,” said Lane.

While Calgary-specific data doesn’t exist, the provincial proportion of long-term unemployment — defined as 27 weeks or longer without a job — is at 23 per cent, says Lane.

“It’s the highest rate amongst the large provinces in this country.”

Inflation is adding pressure to the job hunt. Lane says people are getting desperate “but not willing perhaps to limit themselves to lower skilled jobs or lower earning jobs for fear of getting stuck there.”

Cristina Schultz, a recruitment manager with About Staffing, says a disconnect between employers and job seekers also plays a role in the high unemployment rate.

Especially after the pandemic, job seekers are looking for hybrid or remote work opportunities, while employers want their staff in the office, she says.

And when the labour shortage was more severe after the pandemic, job hunters got used to being offered additional benefits, incentives and higher wages — but now?

“The employers are being more realistic and a little bit more conservative in terms of their budget.”

The power battle is starting to tip in favour of employers, she says, but it isn’t clear who will come out on top.

The City of Calgary’s manager of corporate economics and regulatory affairs, Oyin Shyllon, says he isn’t panicking yet.

He says six months of job losses is concerning, but he won’t worry until it becomes a chronic problem — around nine months.

“When you generally look at jobs, you don’t look month to month, you look over an extended period of time.”

In his eyes, Calgary is just in a different business cycle than other cities, which is why the unemployment rate is so high right now.

The thing that reassures him is that the jobs lost are part-time, while the city’s economy is gaining full-time jobs.

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