Toronto skills shortage: 22% increase in unfilled vacancies as city grapples with lack of talent
- 22% increase in unfilled job vacancies in Toronto
- 44% of firms consider a prospective employees ‘potential’ over their skills & experience
- Third would consider employee from different industry with ‘some’ transferable skills
- Banking, tech, and finance hit the hardest – with 19%, 13%, and 10% of roles unfilled respectively
- Employers unable to increase salary benchmark above inflation in bid to attract new talent
Toronto has seen a 22% increase in the number of new jobs roles that remain unfilled– as companies continue to battle with an acute talent shortage in the city.
With over 150,000 jobs added to the economy this year, coupled with record levels of unemployment in the wider Ontario area, fears are growing that there is not enough local talent to support the growth of the region.
The shortage – driven to a large part by changing demographics, with workers retiring at a faster rate than they can be replaced – has put a strain on employers, many of which have had to alter recruitment practices to ease hiring pressures.
A poll, from specialist recruitment firm Robert Walters found that an overwhelming 44% of employers in Ontario would consider a candidates ‘potential’ over qualifications and experience – with a further third stating that they would not hesitate to hire from different industries if a candidate has at least ‘some’ transferable skills.
Martin Fox, Managing Director of Robert Walters – Canada, comments:
“Employers have been dealing with a lack of talent across Toronto for some time now – and this skills gap will not be filled overnight.
“For organisations to continue to develop and grow, employers should not be afraid to look internally for talent. Many employees have transferable skills and, with the right training, can be upskilled to bring great value to a business.”
Professional Services Jobs Hit the Hardest
The financial services market seems to be struggling the most when it comes to white-collar roles, with a 19% increase in unfilled banking roles in February across Toronto.
Despite the wide-spread layoffs across tech firms in the past six months, Robert Walters data shows that companies in Toronto are still filling a pandemic-related backlog of tech roles – with a 13% increase in unfilled vacancies reported in February.
Martin adds: “In some industries – particularly banking and tech – data could look very different at the end of Q3 following the collapse of Silicon Valley Bank. For example, in banking we would anticipate a spike in demand for risk, compliance & audit specialists as financial services firms look to double down on their practices in a turbulent market.
“Within tech it really is too early to tell what the impact of SVB will have on the market. Unlike other industries such as legal and even recruitment – which is prone to boom-bust hiring – tech is a unique sector where we may never quite have enough skillset globally to keep up with the pace of growth and change.”
Canada is having similar experience to the US on the accounting front – where in Toronto there has been a +10% increase in unfilled vacancies. This is far more pronounced across the border, where America has seen a 27% increase in unfilled vacancies following reports more than 300,000 accountants and auditors have left their jobs in the past two years.
Martin adds: “Much like companies in America, it wont be long before employers look to recruit remote talent overseas to help fill short term voids in the finance market, ahead of notable hiring peaks such as tax season.”
Skills Most in Demand in Toronto
- Accounting: In terms of skills in demand, there has been a dip in corporate and merger & acquisition specialists, but all other areas have seen an uplift year-on-year. Audit is the largest area of hiring – accounting for a fifth of all job adverts – whilst management accounting (+20.4%) and insolvency (+11.39%) has seen the biggest increases in hiring.
- Banking: By function, IT Management has seen the biggest growth (+10.54%) driven by the competition of Fintech’s. Risk and compliance specialists have seen a +8.31% increase in demand with this expected to nearly double in the next quarter. Surprisingly IT Development has contracted by -1.55%, with Robert Walters analysts stating that this in part is down to banks outsourcing projects to tackle high salaries in the city.
- Technology: In terms of skills in demand, cybersecurity has had the biggest increase with vacancies up +36.4%, followed by IT Management (+7.4%). While Development remains the largest area of recruitment, it also saw the sharpest fall, with vacancies down 24.3% – a potential fallout of investment slowing down in the sector.
Wage Inflation not Doing the Trick
This all comes at a time where The Bank of Canada confirmed that interest rates have been capped, despite inflation being significantly higher than the target level. With wages increasing by just 4.5% currently this is below the headline inflation rate, so is doing little to nothing to lure talent away from other companies.
Martin comments: “Employers are in a catch-22; they need the talent, but also turbulent balance sheets are preventing them from offering the types of inflated salaries which look appealing in this market.”