P.E.I. labour shortage predated pandemic but was made worse by it

This is Part 2 of a two-part series on the labour market on P.E.I. You can find Part 1, which looks at the Canada Recovery Benefit and seasonal work on the Island, here.

The labour shortage on P.E.I. has been developing for years, but as the provincial economy emerges from the COVID-19 pandemic, it may seem as if the problem has come about all of a sudden.

As the province re-opens, labour shortages are being felt in industries across the Island, with employers unable to find the workers they need. The latest Statistics Canada labour force survey found that of all the provinces, the employment gap, when compared with February 2020, was largest in Prince Edward Island (-3.4%).

Whether it's wages that haven't kept up with cost of living, insufficient child care, a shortage of workers with the right skills or changing expectations around work-life balance, the pandemic has profoundly changed the job market.

Fewer women in labour pool post-pandemic

Women are among those whose work lives have been disproportionately affected by the pandemic.

As COVID-19 took hold in March 2020 and provinces began imposing widespread lockdowns that affected businesses and schools, it impacted many jobs typically held by women, such as those in retail and hospitality.

Women faced not only layoffs but also ended up taking on the lion's share of child care responsibilities at home, said University of Prince Edward Island (UPEI) economist Jim Sentance.

"We already had a bit of a shortage of child care spaces, but I'm pretty sure the COVID protocols have probably reduced that even further," said Sentance. "And with kids here and there, being out of school, that makes it difficult as well for mothers to participate in the labour force. They've sort of withdrawn from even looking for work."

That problem is reflected in jobs numbers released monthly by Statistics Canada. In February 2020, prior to the pandemic, women made up 49 per cent of the workforce in P.E.I. Last month, they represented 46.6 per cent.

While the number of men in the workforce now exceeds pre-pandemic levels, the number of women has not yet fully recovered.

Vacancies beyond hospitality sector

While Statistics Canada does not break down job vacancies by industry for P.E.I., it is clear the problem extends beyond the hospitality sector, where employers have been vocal about shortages.

Only about 6,500 people work in hospitality on the Island, so the vacancies, which were about 3,600 in June, must be spread across the economy.

But this also is not new. A shortage of workers in construction, for example, predates the pandemic. Analysts point out that that's not a consequence of people not wanting to work — it's about a lack of the required skills in the labour pool.

That problem, said Sentance, extends to other industries.

"The obvious answer is there's a bit of a mismatch between what employers are looking for and what potential employees are looking for," he said.

That's a growing problem in all industries, said Fred Bergman, a senior policy analyst with the Atlantic Provinces Economic Council (APEC).

"Companies are having trouble finding people with the right skills, and that was an issue even prior to the pandemic," he said. "Even when the pandemic fades in the rearview mirror, you know, the labour shortage issue is only going to grow over time."

Going down the road

There are two sides to the coin in the mismatch between employers and prospective employees. It is not just that prospective employees don't have the necessary skills; employers may also not be offering what prospective workers want.

There is some evidence that P.E.I. is losing some sought-after skilled workers to other provinces.

While it is tempting to think that people might hunker down and wait out the pandemic, that's not what happened on P.E.I. Outgoing migration in the first three months of the pandemic was the highest since the start of 2018 — and it spiked again in the early months of 2021.

Incoming migration also jumped up in the province in the first quarter of this year, but Bergman said those people would probably not be as able to fill holes in the labour market as those who are leaving.

"It's a smaller labour market," he said of P.E.I. "Your chances of finding the right job, it would be less. Therefore, you probably want a guaranteed job before you even move there."

Pay not keeping up with cost of living, says former Islander

Robert White is one of the province's recent departures. He moved to P.E.I. in 2014 with his wife. It was an opportunity for both of them to be closer to extended family, and, at first, life on the Island was good, he said.

"I picked up just a quick job, and when I did, the rent was very affordable — much more affordable than Nova Scotia at the time," said White. "It wasn't too hard to just kind of pick up the first job and start earning and start saving some money."

But over the course of the next few years, the housing market changed. Rents started to go up, and the pay at White's call centre job in Charlottetown was not keeping pace.

Rents are controlled on P.E.I., so although his landlord couldn't raise the rent arbitrarily, White said he was feeling the pressure.

"Our landlord was aggressively trying to get us out of there, to either renovict us or just hike up the rent as soon as we left," he said.

White and his wife eventually gave in to the pressure, but they couldn't find another place they could afford, so they moved in with her parents.

"Then we were just kind of treading water," White said.

"You can't save, is the thing, and we wanted to buy a house … but it's just impossible. And we didn't want to have a very small down payment and a very large mortgage that we would have a problem with."

White said he found his situation particularly frustrating because the national company he worked for told him they paid workers in Toronto 30 per cent more because of the higher cost of living.

That does not really reflect the reality in Charlottetown anymore, he said.

Last year, White and his wife decided to move back to Nova Scotia.

P.E.I. wages creeping up more slowly than elsewhere

The labour problems facing P.E.I. are not new or exclusive to the Island.

As work-from-home policies came into effect across the continent, the pandemic had people rethinking their lives. People who have had a taste of life off the treadmill are looking for better working conditions — either from their current employer or by moving on to a new job. Others have decided to just quit working altogether.

Employers across Canada may be trying to respond to this trend by offering more money. Wages nationally are up four per cent over this time last year.

But P.E.I. wages, which have been the lowest in Canada for years, are up less than one per cent over the same period 

This could be a factor in the P.E.I. labour market, Bergman said.

"People would tend to kind of gravitate toward higher-paying jurisdictions, if possible, or industries," he said.

'I can have a plan to do something more'

White described the Charlottetown job market for work that paid more than $15 an hour when he was looking as "absolutely awful." 

He said he found his life improved almost immediately when he moved back to Halifax.

"I was able to pick up a job immediately that paid, you know, over what anything you would be able to find in Charlottetown. And then I saved up a little bit of money and decided I was going to go back to school," he said.

"It's not that the rents here are lower. It's that the jobs here actually pay people [well]," he said. "Nobody [in Charlottetown] wants to pay enough to be able to survive."

Servers are getting burned out.- Carol Le Maistre-Matthys

White is currently working two part-time jobs in Halifax while studying tourism at Nova Scotia Community College (NSCC), and his wife works in a hotel. He said they're now able to think about improving their lives in ways that did not seem possible on P.E.I.

"It was so frustrating when you're seeing, like, your landlord's trying to kick you out … you're seeing that rents are, like, $2,500," he said.

"And you're like, 'Well, I guess I am just going to tread water forever and never be able to survive.' So that's depressing. I mean, it caused mental health issues for myself. And those are gone now that I'm here and I can have a plan to do something more than tread water."

Hospitality workers tired of inconsistency

Carol Le Maistre-Matthys, who gave up waiting tables to work in a pharmacy after her income became increasingly precarious in the pandemic, said it is not just about pay, but also about working conditions.

"Servers are getting burned out by the demands and the inconsistency," said Le Maistre-Matthys, who is also a third-year student in the radiography program at UPEI.

"If businesses want to keep servers, they're going to have to cater to being on top of their schedule."

White said when he started the tourism program at NSCC, it was with an eye toward once again moving back to P.E.I. to work or perhaps to start a business. But he doesn't see himself doing that now.

"Looking at the job market and the housing market back in P.E.I., I don't think I'm going back," he said. "We're pretty certain we're going to stay here."