Jobs are plentiful, but unemployment is rising. What gives in London?

Thousands of jobs are begging, more are coming off a pike, and London’s unemployment rate continues to rise. The question is why?

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Thousands of jobs are begging, more are coming off a pike, and London’s unemployment rate continues to rise.

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The question is why?

Unemployment in London rose for the third consecutive month in July to 6.1 per cent, defying the national trend which has left Canada at a record low of 4.9 per cent which is as close as possible to full employment in this country.

But while the national average has remained stable, even with more than a million job openings in Canada, the London region’s rate has risen again amid a growing pile of available jobs – more than 6,000, posted with the region’s recruitment agencies, and more to come as the big employers , such as Maple Leaf Foods Ltd. Food giant and online retailer Amazon, are completing major new operations they are building here.

How can both things – the unemployment rate and the huge number of job vacancies – go up at the same time?

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Analysts say a mix of factors could play a role, including more people looking for work entering the workforce, being factored into monthly unemployment numbers, such as the latest snapshot released on Friday, and others being more picky about the types of jobs they do. Wants.

Other workers still simply do not have the skills employers need to fill the many available jobs.

“When people think they can find a job and start the search process . . . that puts some pressure on the unemployment rate, but if that’s what’s going on, that’s actually a positive thing for the job market,” said Audra Pauls, professor of economics at Western University.

“The other thing that could happen is that we have a mismatch between unemployed people looking for work, and the vacancies that are available now,” she said, adding “that’s a bigger problem” if that was the case.

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She said the explanation might be somewhere in between the two.

If you ask Jason Bates, who chairs the London District Manufacturing Council, part of the problem is the need for a better trained workforce.

“There is certainly not enough talent available,” he said, “especially with regard to skilled trades.” This has been an ongoing problem for years.

“You’ve got a lot of people retired and there aren’t enough new talent coming in to replace a lot of those people leaving the workforce.”

Holding certain jobs has become such a challenge, it hurts the pace at which some companies are growing.

It also led some companies to start looking at automation to help solve the long-term staff shortage, Bates said.

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“A lot of plants look at it from a different perspective,” he said.

A survey of businesses in the London area this year by the Regional Workforce Planning Council found that nearly two-thirds of employers were having difficulty getting their hands on adequate labour, citing a shortage of qualified workers as the main issue.

But Bates also said manufacturers are having a hard time finding workers in less skilled jobs, including entry-level jobs and other clerical jobs.

It’s not just a manufacturing problem, said Kapil Lakhotia, head of London Economic Development.

“We know that there are a lot of industries that are growing exponentially in this region that are desperately looking for more workers,” he said.

“What we are hearing from employers is that despite the unemployment numbers, they are simply not getting the volume of applications for job vacancies that are being advertised.”

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If so, job seekers may have become more selective, looking for better paying work amid a higher cost of living or more flexible work arrangements such as work-from-home jobs, Paul said.

She said when workers know there are a lot of jobs available, they are less likely to accept what they can get.

“They have what we call ‘high wages,'” she said.

“They want the highest value for their skills, and therefore they are not willing to take on jobs in the service sector if they think they can do a better job. So, they are very selective about what they apply for.”

If Canada heads into a recession, Paul said, as some analysts believe, the mentality and behavior of those looking for work is likely to change.

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Lachotia said he is aware of the fluctuation of potential economic problems in the future, but is confident that the London region’s economy, with its mix of different types of employers, can withstand the fallout.

“The diversification of our economy helps us better withstand economic cycles,” he said.

“While we cannot control global economic conditions in our neck, we have a lot of growing employers and strong demand for workers. We expect this to continue with a pipeline of new projects that are already underway.”

The number of people employed in the London area in July was 294,900, about 30,000 more than in February 2020, just before the pandemic began.

The figures include St. Thomas and Strathroy and parts of Elgin and Middlesex counties.

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The region’s labor force participation rate – the percentage of people of working age who are working or looking for work – was 66 percent in July. That percentage has been hovering in that range for months, up from 57.2 percent three years ago when it was among the lowest in Canada’s big cities.

Canada’s unemployment rate remained at 4.9 percent in July, a historic low, unchanged from June amid a national labor shortage.

The market remains exceptionally tight, with more than a million job openings and the lowest unemployment rate ever using comparable data going back to 1976.

– With a file from the Canadian Press

jjuha@postmedia.com

Twitter.com/JuhaatLFPress


Unemployment rates for July vs. June

London: 6.1% (5.8)

Ontario: 5.3 percent (5.1)

Canada: 4.9% (unchanged)

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