Insider Only Human Resources, Ottawa

Not as many perks for job seekers in 2024 as labour market returns to balance, HR expert says

January 10, 2024
4:04 PM
ET

Organizations: Keynote Group

People: James Baker

For Ottawa’s labour market, 2024 will be the year of compromise as the balance of power starts to swing back to employers, according to James Baker, CEO and co-founder of Keynote Group.

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For Ottawa’s labour market, 2024 will be the year of compromise as the balance of power starts to swing back to employers, according to James Baker, CEO and co-founder of Keynote Group. The past few years have been a jobseekers’ market in Ottawa and much of the rest of Canada. Baker said last year started to see some equilibrium. “Overall last year, we started to see the return to a balance between what the candidate employee was looking for versus the employer,” he said. “It was the first real time of balance on the employment market, where it was almost give-and-take. If you were looking for a job, you might concede on a few points and the employer may consider a few points to come to a compromise.” Last year was tumultuous for both employers and job seekers in Ottawa, according to Baker. While the federal government grew its headcount, the private sector started to contract. In the latter half of the year, Baker said employers were increasingly concerned with the cost of goods and services, while facing challenges gaining access to capital. With cost concerns top of mind, businesses are now streamlining their teams, scaling back positions, and taking a more strategic approach to hiring. For employers, it means more flexibility and more bang for their buck. “On the employer's side, that means they can get a little more value for that role than they did previously,” said Baker. But a scale-back in hiring means fewer positions and a higher barrier to entry for job seekers. With a continued influx of new residents to the city, more redundancies, and decreased seasonal hiring, job seekers are in for a challenge. Baker said he expects unemployment to rise to seven per cent in 2024. “If you’re applying to a position, there’s more competition for that job than there was two years ago,” he said. “More people are looking for work. Posted jobs are getting more applicants but also the volume of posted jobs is decreasing.” As a result, Baker said 2024 may be the year of compromise for the labour market. “Businesses need to do what they need to do to survive and prosper and grow, but it has to be done in a balance with the employment market,” said Baker. “I think everybody needs to be prepared to compromise and be open to suggestions and ideas to make it work for everybody.”

Competition will be tough for remote positions

Fully remote jobs will be the most competitive, he said, as employers gain the upper-hand when seeking to return workers to the office on a more full-time basis. “We’re starting to see those conversations on that mandated return to office,” he said. “That is always going to create flux, because people will make decisions on whether or not that structure is right for them.” That could have knock-on effects for employee productivity. With the market tight, Baker said job security concerns could influence employee behaviour and a return to office would help reverse productivity declines seen during the lockdown years. “Our largest employer (the federal government) is still working almost exclusively remotely. That influences opinion,” he said. “We are a wonderfully balanced city when it comes to work-life balance already, so anytime we sway from that, we look at a drop in productivity that puts pressure on businesses. As businesses start to look at three or four days in the office, that will have a knock-on effect on employees' engagement and happiness because it will be a shift for a lot of people.” Baker also expects to see more movement from businesses once the central bank stops raising or starts reducing rates. “A lot of them have been in a holding pattern, waiting to see what happens, which also has a bearing on the labour market. It means less growth, focusing on critical needs and not on any outstanding ones. It also impacts training and development, where you hire those with experience rather than train and develop new hires,” he said. “I think businesses will start to gain confidence.” For small businesses, 2024 has some challenges in store. This month, the CEBA loan repayment deadline looms and Baker said a wave of small business closures is likely in coming months. “You’re seeing a lot of activity on the mergers and acquisitions front, as larger corporations who have been conservative in the last 18 months are now starting to think of ways to gain some market share,” he said. “Given the pressure small businesses have faced, you’ll see a lot of those swallowed up by larger corporate entities.” But for those who make it through the year, there may be a light at the end of the tunnel. “Small businesses have had a tough run for the last four years. But, in my opinion, they’ve done a fantastic job trying to do right by people through the pandemic. We will start to see some positives in the next three to six months,” he said. “We’re nearly there; we’ve just got to hold on tight. The back end of 2024, I think, will bring some prosperity for those who are able to make it through.”