U.S. holiday seasonal workers to get 32% pay hike this year — what about Canada?
It’s going to be a happier holiday for America’s seasonal workers this year. With the U.S. economy firing on all cylinders, retailers are expecting big business for the holiday season. Earlier this month, Goldman Sachs even mused about a “retail renaissance,” on the heels of the industry’s best quarter since 2004.
But finding extra help to handle the expected holiday shopping bonanza is getting harder and harder amid a hiring boom that’s sent the nation’s unemployment rate to a 48-year low of 3.7 per cent.
All this means that salaries are headed nowhere but up. Hourly pay for seasonal employees is expected to rise by nearly 32 per cent, according to a recent holiday hiring survey conducted by Snag, a marketplace for hourly work, and Wakefield Research. The average wage is expected to rise from US$11.70 last year to US$15.40, the report showed.
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Not only that, but “a majority of employers (77 per cent) say they’ll be offering perks and benefits including paid time off, training opportunities, childcare, tuition stipends, health insurance, and even transportation reimbursement,” Snag said in a press release.
Canadians hoping to earn some extra cash during the holidays can also expect a bigger payback this year.
With the economy growing at a healthy clip and the national unemployment rate hovering around a low 6 per cent, Canadian employers are also struggling to fill jobs.
On Monday, the latest Bank of Canada survey of Canadian businesses found that labour shortages touched a 10-year high. And the results capture the mood before Canada and the U.S. announced a new trade deal to replace NAFTA.
The positive conclusion of the trade negotiations “will reinforce that trend — many companies will continue to hire,” said Patrick Poulin, president of the staffing division at Randstad Canada.
And the end of NAFTA uncertainty will also “take uncertainty out of consumers’ minds,” said Michael LeBlanc, senior retail advisor at the Retail Council of Canada. A recent survey by consultancy PWC, for example, found that Canadians are planning to spend an average of $1,563 this year, nearly four per cent more than last year.
The holiday hiring spree, meanwhile, is already underway, both Poulin and LeBlanc said, with some employers fielding job applications as early as the start of September.
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But it isn’t just retailers looking for more hands on deck.
While the retail sector is currently expanding at a solid 2-2.5 per cent per year, e-commerce is seeing double-digit growth, LeBlanc noted. And that means more hiring in warehouses, fulfillment centres, and logistics companies.
In terms of hourly pay, Canada likely won’t see the kinds of steep increases seen in the U.S., LeBlanc added, but that’s in part because compensation on this side of the border is higher to begin with. That’s especially true with the onset of higher legislated minimum wages in a number of Canadian provinces in recent years.
“We already had the [pay] shock,” LeBlanc said.
In Ontario, for example, the minimum wage increased by 21 per cent at the start of the year, when the province raised its pay floor from $11.60 to $14 an hour. In Alberta, the minimum wage rose to $15 in October. That’s a much higher starting point than in the U.S., where the federal minimum wage is US$7.25 per hour.
Still, despite the recent hikes, average wages in the retail sector remain above the minimum wage, LeBlanc told Global News.
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The same is true for the warehousing and logistics sector, as well as food manufacturers, which also experience the holiday peak, Poulin said.
For employers seeking to attract talented job candidates in this tight labour market, “the minimum wage shouldn’t be the target,” he said.
In Ontario and Alberta, for example, Poulin is seeing clients offer between 50 cents and $1 above the minimum.
But the degree of competition to fill jobs can vary significantly at the local level, both LeBlanc and Poulin said.
Vancouver, for example, is one of the toughest job markets for retail employers, LeBlanc said.
The minimum wage, currently at $12.65 in B.C., is “less relevant there,” he added.
And staffing a warehouse in Montreal, where the unemployment rate is around six per cent, is far easier than in Quebec City, where the jobless rate has dipped to less than four per cent.
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