News / Vancouver

Vancouver workers unlikely to see much increase in pay

The hottest job market in Canada. The highest cost of living. A severe labour shortage. So why aren’t wages rising for B.C. workers?

Workers on Granville Street. Despite strong job creation, B.C. workers have yet to see much of an increase in wages.

Jeff Hodson

Workers on Granville Street. Despite strong job creation, B.C. workers have yet to see much of an increase in wages.

If you live in Metro Vancouver and are trying to pay your rent or mortgage, you probably feel like you could use a raise.

But despite B.C.’s booming job market, economists aren’t seeing the lift in wages they expected.

“Given our employment growth, it is a puzzle,” said Bryan Yu, an economist with Central 1 Credit Union.

Metro Vancouver and Victoria are currently Canada’s bright spots for job creation: since January, job growth in Metro Vancouver has increased 5 per cent while Victoria has seen growth of 3 per cent, compared to just 0.4 per cent for Canada. Tourism, construction, tech and professional services are all sectors that are hiring and, in some cases, have complained of severe labour shortages.

In contrast, wages in B.C. have grown just one per cent.

More people in B.C. are looking for work and job seekers from other provinces are flocking to B.C. That extra supply of labour could be one reason wages have stayed flat, Yu said. B.C. has also lost some high paying jobs with the downturn in mining and oil and gas, although that effect is relatively minor.

B.C.’s hot real estate market has created a lot of construction jobs and wages have seen a modest 2.4 per cent increase compared to 2015, according to BC Stats.

“Competition is tight and (labour) supply is tight,” said Fiona Famulak, president of the Vancouver Regional Construction Association.  “There’s a lot of demand given the economic activity going on, but we’re finding there’s a shortage and we’re going to continue to be thousands of workers short.”

But companies have focused on offering training and benefits to employees rather than wage increases, Famulak said. They’re recruiting from other provinces and countries and even poaching from other companies in order to find the people they need.

As in many industries, Famulak said, many construction workers cannot afford to live in Metro Vancouver’s inner suburbs and are commuting to the job site from locations like Langley.

Accommodation and food services businesses have struggled this year to find enough people to fill positions. Go2HR, an organization that provides resources to B.C.’s tourism industry, said there has been an increase in the average hourly wage, from $13.96 this July compared with $15.05 last July. However, wages have yet to regain the high of $15.40 in January 2015.

With employers no longer able to access temporary foreign workers for low-skilled jobs and steady job growth anticipated, wages should start to creep upward, Yu said.

“It’s going to put pressure on wages for some of these sectors,” he said.

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