Month: September 2021
With the border closed, international travel to Canada in the first half of 2021 remained extremely low compared to 2019 (see Figure 1). Because the number of both travellers and tourists was so low, measuring any sort of increase since the pandemic struck requires removing any data from earlier than February 2020, the last month before international travel essentially came to a halt.
By doing so, we can see that there has been some increase since April 2020, particularly in July 2021 (see Figure 2). That month saw a notable increase in both travellers and overnight tourists (see Figure 3) entering the country. But compared to pre-pandemic traveller volumes, it was insignificant.
Overall, the total number of international travellers entering Canada in July 2021 was down 95.0% compared to July 2019. This summer, tourism businesses had to rely on business from locals and from people travelling within the country. Recovery did not start for those segments of the industry that rely on international visitation.
Overall economic activity in the sector remained suppressed going into the summer. Across the entire economy, Gross Domestic Product (GDP) had not quite returned to the level seen in January 2020, but it was close. That said, without the pandemic, GDP would have continued to grow—being at 99% of pre-pandemic GDP seventeen months later is not a good news story.
But it is worse for the tourism sector. GDP in tourism-related industries was only 62% of the level seen in January 2020, and for some industries, it was much worse. Air transportation was operating at just 11% of its pre-pandemic level of economic activity. Economic activity in the accommodations industry was only at 58% of where it was seventeen months earlier.
Reflecting lower economic activity, data on monthly business openings and closures for June 2021 show there are fewer active tourism businesses than there were at the start of the pandemic. Active businesses are defined as businesses that reported having one or more employees in a given month. If a business is inactive, they have either temporarily or permanently closed, or are operating with no staff.
As of June, there were 8.6% fewer active tourism businesses than in January 2020. Whereas across all sectors of the economy, there were more active businesses than in January 2020 (see Figure 6).
The travel services industry and tourism transportation industry had lost the most active businesses, down 29.7% and 11.3% since January 2020.
The dataset does not distinguish between a business that has gone inactive temporarily or permanently. However, the fact that the number of tourism businesses has been hovering around 90% of pre-pandemic levels since November of 2020 strongly hints that many of these businesses have closed permanently.
One industry that has an opportunity to recover even with the borders closed is the food and beverage services industry. In June, GDP in that industry was higher than many other segments of the tourism sector. As an industry, it gets about 20% of its total revenue from tourists. Within Canada, international tourism makes up about 20% of tourism demand, while the rest comes from domestic tourists. Thus in terms of a recovery within the tourism sector, the restaurant industry is placed to recover as public health restrictions lift, rather than when the border reopens to travellers.
Restrictions that limit seating capacity or close indoor dining entirely have of course had a serious negative impact on sales within the food service industry over the past year. However, as of July, total food service sales in Canada reached $6.7 billion dollars, which is only 4.0% lower than in July 2019. Regionally, sales varied from -10.4% in Ontario, which only allowed in-door dining part way through July, to +1.5% in British Columbia and +1.7% in Newfoundland and Labrador.
Not all segments of the food service industry have recovered to the same degree, however. In July, sales were up 3.5% in limited-service establishments compared to July 2019. Yet sales were down 4.8% at full-service restaurants, and sales at drinking establishments were still significantly repressed, down 20.4%.
The summer of 2021 was the first opportunity many tourism businesses have had to begin bringing in some revenue to offset the losses and debt incurred over the previous year and a half. For the most part, only those businesses that could cater to locals and domestic tourists had this opportunity. For businesses that cater to events with longer lead times (e.g., conferences and festivals) or to international travellers, this opportunity remains over the horizon.
The point is: just because public health restrictions were loosened does not mean all is now well for the sector.
Many businesses have a huge hole to climb out of financially. Over half of tourism businesses took on debt to sustain themselves, and the majority of those that did are concerned that it will hamper their ability to recover post-pandemic. Two months—less than that in some cases—is too short a time in which to recoup losses built up over fifteen months. This is especially true when businesses were unable to find enough staff, forcing them to turn away some customers, and therefore missing out on potential revenue. And the pandemic itself is not gone. Some regions are once again limiting business activity to mitigate further COVID-19 outbreaks.
The tourism sector started the summer of 2021 from a very difficult position. An inability to find enough workers added to that challenge. Make no mistake—while being able to open was better than not being able to, the industry still has a long way to go before it will be back on its feet.
The Propel Student Work Placement Program offers tourism and hospitality employers access to up to $7,500 in wage subsidies when they hire a post-secondary student for work-integrated learning: an internship, a co-op placement, a work experience placement, and more.
The many benefits? Students gain paid hands-on learning and mentoring in their field of study. Employers acquire much-needed early talent to help with the recovery of the industry, as well as assistance with wages after an 18-month stretch of little or no income. Post-secondary institutions complement their programming by connecting students and the workplace.
Tourism HR Canada will be hosting an info session on this recently launched program on Thursday, October 7, at 1:00pm Eastern.
Join the one-hour virtual session to learn:
- What work-integrated learning is, why it matters, and how it can benefit your business
- Who qualifies for the Propel program
- Where to post a job
- How to apply for a wage subsidy
- What information you’ll need
- When the subsidy is available
- How Tourism HR Canada can support you
A Q&A component will follow the presentation. Registrants are invited to submit questions in advance via the registration form.
Join us for a full look at this federally funded program that supports the hard-hit tourism and hospitality sector. Register today!
This summer, the tight restrictions on activities that had been put in place during the third wave of COVID-19 were lifted. Although the timing and degree of relaxation varied by province, Canadians were able to travel, go to restaurants, visit museums, and book a hotel room. Although international visitation remained extremely limited, the domestic tourism industry was more or less open.
With that came increasing demand for tourism activities. Canadians travelled. They ate at restaurants and visited friends and relatives after long months of limitations.
With that increasing demand, businesses needed to restaff. In the month before the pandemic struck, just over two million people were employed by Canada’s tourism sector—and February is a low point for tourism sector employment. In July 2019, tourism sector businesses employed 2,215,900 people.
The pandemic hammered the tourism industry and its workers. Over 880,000 individuals lost their jobs in the first two months of the pandemic. Although employment never fell that low again, every time employment began to increase, another wave of COVID-19 necessitated another round of restrictions and further losses of employment.
As they began to restaff, many businesses found that they could not find the workers they needed. The restaurant industry was particularly hard hit. Stories about labour shortages have featured prominently in the media. Our own survey conducted in March found 55.8% of food and beverage businesses expected that an inability to hire staff would negatively affect their business this summer.
The summer proved even more difficult than expected. A survey by Restaurants Canada found that 80% of respondents were having difficulty finding back-of-house staff and 67% were having difficulty filling front-of-house positions. Although labour shortages have been a concern of tourism business owners for years, it is only now becoming such an issue that it is clearly visible to the customer.
In July, there were over 130,000 vacant positions in the accommodation and food services sector. The vacancy rate in that sector was 11.6%. For the second month in a row, there was more than 1 empty position for every 10 employed workers.
But people are taking jobs in tourism—employment in the sector did increase by 184,900 this summer, including 74,900 individuals in the food and beverage services industry. People are filling tourism jobs, just not enough of them to meet the labour needs of employers.
Businesses are desperate for workers. The pushback has been that this is a labour shortage of the sector’s own making, or that the compensation and working conditions simply do not match the needs and wants of enough people to make the jobs attractive.
Many tourism businesses cannot find enough staff. That is true. But a true labour shortage is one where you have three positions but only two people available. In other words, no matter how much money you offer, no matter the conditions of employment, that third position cannot be filled. In fairness, there are regions where this is likely true. A lack of people in their region has long been an issue for operators in rural and remote regions.
But if we look at the current state of the labour market, it is hard to argue that we have a true labour shortage. The question is: what has happened to the people who filled tourism jobs before the pandemic?
In some cases, the workers truly are not there anymore. A good example is the International Experience Canada (IEC) program, commonly known as a working holiday visa. This program, which allowed young people from other countries to come to Canada with an open work permit, filled many jobs in resort towns, particularly ski resorts. The number of permits being granted for this program has fallen precipitously, and it is likely that even fewer individuals than are granted permits are actually arriving in Canada. IEC participants are not a large part of the entire tourism sector’s workforce, but they are a crucial labour source for certain businesses and regions.
At the same time, low numbers of new permanent immigrants have been arriving in Canada, which has slowed the growth of the labour force. The number of monthly arrivals has returned to pre-pandemic levels, but labour force growth was essentially put on hold for over a year. Over the previous year, there was a significant drop in the arrival of permanent residents, which means the labour force did not grow as much as it normally would have. This will have restricted the flow of new workers—some of whom would have worked in tourism—into the labour force.
The other side of the story is one in which unemployment remains elevated. In fact, despite the number of employed workers increasing in August, the number of unemployed people climbed as well, growing by 44,700 compared to July. As of August, there were 461,400 more unemployed individuals than in February 2020, the last month prior to the pandemic. To eliminate seasonal variance in unemployment, we can look at the same month prior to the pandemic. Even by this metric, there were 327,000 more unemployed workers than in August 2019. There are people looking for work, but they are not taking jobs in the tourism sector in the numbers needed to meet customer demand.
The number of individuals who are not actively participating in the labour force has also increased relative to pre-pandemic times. In July, there were 294,900 more individuals not in the labour force than in July 2019. In August, there were 345,600 more individuals not in the labour force than in August 2019.
These are individuals over the age of 15 who are not working and not actively seeking work. Unlike the elevated number of unemployed workers, there may be limited opportunities to draw people from this group back into the active job market.
The number of people over the age of twenty-five who are not in the labour force is elevated, but this is entirely driven by those over the age of 65 and under the age of 25. The number of individuals over the age of 65 who are not in the labour force has increased by 6.7% since February 2020. If these were individuals whom the pandemic pushed into retirement, it will likely be difficult to convince them to rejoin the labour force.
For the age groups between 25 and 65, the number of people not actively engaged in the labour force has actually declined, both since the start of the pandemic and relative to the same month in 2019. This decline suggests that there is limited scope to increase participation rates among these age groups.
The number of people aged 15 to 24 who were not actively engaged in the labour force increased in August by 40,200. This is not unusual and occurs most years as young people start leaving jobs to return to school. What should concern tourism employers is that the number of young people not in the labour force in July was lower than in July 2019, but in August, the number of young people not in the labour force was higher than in August 2019. This suggests that young people who did seek work became discouraged by the job market and either stopped seeking employment or left jobs they had in greater numbers than two years ago.
Ultimately, in the summer of 2021, Canada did not have a labour shortage. Some key labour pools were absent, but unemployment remained elevated as did the number of people outside of the labour force in the key 15- to 24-year-old age range. In August, the tourism sector needed 284,500 more workers to have the same number of employees that it did in 2019. This gap could easily have been covered by the elevated number of unemployed workers alone.
Despite this, the tourism sector cannot find enough employees. Many point to programs such as the Canada Recovery Benefit (CRB) for encouraging people to stay out of the labour market. Our survey of employers found that among those expecting a labour shortage to occur, 70% said that workers choosing employment insurance over work would be a cause.
Whether or not that was true this summer, employment insurance benefits are are now shifting back to pre-pandemic requirements. The Canada Recovery Benefit program is scheduled to wrap up in October.
Tourism demand is highly seasonal, even in industries that rely on locals for the majority of their revenue. Aside from some industries that focus on winter activities, we are entering a slow period for tourism. It is in the spring when significant hiring picks up. What happens in the labour market between then and now will determine how significant a labour shortage the industry faces. Programs such as CRB will probably be gone. But unemployment rates may well have fallen back to pre-pandemic levels. If so, there will be little slack in the labour market for the sector to tap into.
The disruption and uncertainty of the last few months has made it difficult to plan and prepare—in the spring, operators couldn’t be certain whether they would be allowed to open at all. Tourism businesses need to use the coming months to prepare their workforce. Retaining existing staff, or ensuring they are willing to return next year, will be vital. Attracting new staff will also need to be a focus. While we do not have exact numbers, many long-term tourism workers retrained and moved to other industries over the past year and a half. There are simply are not enough experienced workers to go around. Rebuilding the tourism workforce is going to take an investment in time and effort. It will require a willingness to hire and train inexperienced workers, and rebuild our workforce from the ground up.
Tomorrow, September 30, will mark the first National Day for Truth and Reconciliation.
This day honours the lost First Nation, Métis, and Inuit children and Survivors of Residential Schools, their families, and their communities. Since May, 6,509 unmarked graves have been found at former Residential School sites, with many more Indigenous children still unaccounted for. The impacts of this systemic attempt to oppress and erase Indigenous cultures are actively felt, as are the impacts of countless others, past and present.
Tourism HR Canada will be closed on this solemn day. Our team members will remember, learn, contemplate, and act. We invite you to join us in meaningfully and thoughtfully acknowledging the oppression of lands, cultures, and the original Peoples in what we now know as Canada, and to consider how we can each move forward in a spirit of reconciliation and collaboration…not just tomorrow, but every day.
The Indigenous Tourism Association of Canada has shared a series of actionable steps to be an ally to Indigenous Peoples and communities. View them here.
Remember Me: A National Day of Remembrance will be livestreamed from Ottawa beginning at 10:00 AM Eastern Time. Click here for the full schedule and link to the YouTube stream.
Additional resources include:
Indigenous Canada, a free online course offered by the Faculty of Native Studies at the University of Alberta
native-land.ca, an interactive map of Indigenous territories, languages, and treaties
The National Residential School Crisis Line: 1-866-925-4419, 24 hours a day
As part of our organization’s journey, Tourism HR Canada is in the process of including land acknowledgments in communications and publications. Feedback is welcome.
As our industry looks to rebound from the devastating challenges of the pandemic, Tourism HR Canada continues to facilitate, coordinate, and enable activities that foster an inclusive, sustainable, and resilient workforce.
Over the past 18 months, we’ve launched the TourismRecovery.ca microsite and webinar series, offered training resources free of charge, kept stakeholders up to date with the latest labour and employment data, hosted and participated in discussions on the pandemic’s impact on the workforce and strategies to rebuild it, and secured a wage subsidy program for hiring post-secondary students.
The engagement of our members has helped make this happen.
In light of the hardships faced by our industry, we have strengthened our membership program. Three streamlined categories offer a more robust benefits package. Your membership will provide access to:
- All labour market intelligence (LMI) reports free of charge
- 15% off Emerit online learning
- Special rate on Emerit Consulting services
- Corporate profile on Tourism HR Canada’s website
We look forward to our members’ continued involvement as we pursue innovative approaches to overcoming drastic labour losses and ensuring our workforce’s future resiliency.
If you would like to become a member, or are looking to renew your membership, please email info@TourismHR.ca. Membership categories are:
- Business/association/academic institution: $300/year
- Individual: $100/year
- Student: $50/year
Active members are invited to join our Annual General Meeting, to be held November 17–18, in Ottawa. Details, including call-in information for those unable to meet in person, are available by emailing info@TourismHR.ca.
The tourism sector experienced a summer in which our ability to find workers was more difficult than ever. This was despite restricted demand from tourists, especially international travellers, and unemployment levels that remained above pre-pandemic levels. Many industries within the tourism sector are still waiting for demand to return, but for those that have started to reopen, demand for their services has outstripped their ability to find enough workers to meet that demand.
As the summer ends, we need to look at employment trends within the tourism sector, but we also need to consider broader employment trends that cross all sectors. These broad labour market trends have implications for the tourism sector’s ability to find staff when it is time to build capacity for the winter season, and for next summer.
Tourism HR Canada is also tracking the indicators that measure the economic health of our industry. The September editions of Tourism HR Insider will feature detailed information (summarized here) in a series of articles. One of these, Summer Employment Rises but Falls Short, is available today. You can also find all of our information on our website.
Tourism employment grew significantly over the summer of 2021. While employment in tourism exceeded last year’s employment numbers—at almost 1.9 million employed workers in August—it was still far short of 2019 levels.
Employment in the tourism industries most reliant on international travellers did not recover as much as those that can draw on locals. Compared to the same month two years ago, employment was down 27.9% in the accommodations industry this August. In the travel services industry, employment was down by almost half. Employment was down the least (-12.5%) in the food and beverage services industry, which faced significant challenges finding workers.
Tourism employment was down in all provinces. Compared to 2019, tourism employment in August ranged from -4.3% in Manitoba to -23.2% in Newfoundland and Labrador.
Compared to pre-pandemic times, the number of hours tourism employees are working is even lower than employment levels. On average, each worker in our sector works fewer hours each week than they did in 2019. Lower hours could indicate the possibility of mitigating labour shortages in the sector by increasing the hours of the existing workforce. But it is also possible that full-time workers who lost their jobs did not return to the industry and have been replaced by part-time workers—who may not be seeking full-time hours. In August, full-time employment in tourism was down 16.4% compared to August 2019, while part-time employment (defined as under 30 hours per week) was down only 5.9%.
An important labour source during the summer months is students. The pandemic severely disrupted student employment in 2020. The number of students working was much lower than in 2019 and, conversely, the unemployment rate for students was much higher.
In 2021, overall student employment looked similar to pre-pandemic times—at least in the latter half of the summer. Student employment was down and unemployment was up in May and June. But by August, more students were working than in 2019. Although we cannot tell which industries those students worked in, a lack of student participation in the labour force was not the cause of summer labour shortages by itself.
Labour Supply and Demand
This summer was one of contradictions for the tourism sector. Demand for the sector’s products and services remained suppressed. The number of travellers entering Canada remained highly subdued. Many businesses still operated under some form of restrictions that limited capacity. At the start of the summer, sales in the food service industry were starting to get back to pre-pandemic levels. But this was largely driven by limited-service restaurants. Sales at limited-service establishments were down just 0.5% compared to June 2019. Other types of food service establishments were still seeing significant reductions in their sales: sales at full-service restaurants were down 24.7% compared to June 2019, and sales at drinking establishments were down 43.5%.
Despite low demand, the sector also entered the summer with an acute need for labour. In June, businesses reported over 815,000 vacant positions they were looking to fill. Almost 130,000 of those vacant positions were in the accommodation and food services sector. While that sector is not representative of the entire tourism sector, it does show what happens when restrictions lift and there are not enough people willing to fill the jobs needed to meet demand. In June, the vacancy rate for the accommodation and food services sector was 12.7%—more than one vacant position for every ten employed workers in the industry.
Despite the perception of labour shortages, people were available to work. As of August, the number of employed workers in Canada was still 0.4% lower than in August 2019. In seven sectors of the economy, employment was higher than it was two years ago. In nine sectors, employment remained suppressed.
Unemployment levels have been elevated since the pandemic struck. In the 14 months before the pandemic, 1.15 million people were unemployed each month, on average. In July 2021, there were 1.6 million unemployed workers. That increased 2.8% to 1.65 million unemployed workers in August, likely because more people started looking for work due to the lifting of health restrictions. August saw 461,400 more unemployed workers than in February 2020, the last month before the pandemic, and there were 327,000 more unemployed workers than in August 2019.
The number of people not in the labour force is also elevated compared to before the pandemic. The bad news for the tourism sector is that some of that increase is among 15- to 24-year-olds, a key source of labour for tourism. The number of people aged 15 to 24 who were not actively engaged in the labour force increased by 40,200 in August. This suggests that young people were becoming discouraged by the job market and stopped seeking employment.
Meanwhile, the increase in people over the age of 25 who are not active in the labour force is entirely driven by those older than 65. For those between 25 and 65, the number of people not actively engaged in the labour force has actually declined, both since the start of the pandemic and relative to the same month in 2019. The decline in inactive workers aged 25 to 64 means there is very little opportunity to draw people in that age group back into the labour force. A mix of early retirements and health concerns is the likely cause for the surge in individuals over the age of 65 leaving the labour force. It is questionable whether they will choose to return.
International Workers and Immigration
Another key constraint on the tourism labour force is the low number of International Experience Canada (IEC) participants entering the country. Commonly referred to as working holiday travellers, these individuals are essential workers for the tourism sector. Since March, the number of IEC permits being issued has fallen well below normal levels—and the number of individuals who then actually arrive in Canada on an IEC permit is likely even lower.
Finally, the monthly arrival of new immigrants to Canada has now recovered to the levels that existed pre-pandemic. However, there was a significant drop in the arrival of permanent residents over the past year, which means the labour force has not grown as much as it normally would have.
All of this has created significant challenges for the segments of the tourism sector that are reopening. Demand for their services has increased much more quickly than their ability to hire workers.
To this point, our monthly reports have focused on employment levels within the tourism sector. While this will continue, broader employment trends are becoming a more significant concern. They will feature more prominently in our reports from now on. The sector is entering a period where employment typically drops for many tourism industries. For the most part, Canada’s tourism sector is still waiting until next year for demand to truly recover.
In the meantime, macro labour force trends will indicate how great future labour shortages could become. Currently, unemployment remains high and some young people are not actively engaged in the labour force. Despite the challenges facing business owners, there is slack in the labour market. That may not be the case by the time we start to hire for the summer of 2022.
The Canadian tourism industry has always relied on the higher education system for talent. Our industry employs students enrolled in a variety of programs as seasonal or part-time staff, and we hire students who have intentionally chosen tourism-related programs trying to build their careers in our sectors. The Canadian higher education system is truly world-class and can be an ally in the ever-present struggle for talent.
As a hospitality industry practitioner and a higher education leader, I can attest to the tension that exists between “industry” and “academia”. And as an alum of Ryerson University’s hospitality and tourism management program, I have seen this tension harnessed to create a dynamic that benefited my career immensely as it helped me develop both a depth of knowledge and a depth of skills.
The truth of the matter is, as it tends to play out in other areas of our lives, success does not grow from a binary mindset. Success grows from blending both forces together—industry and academia working collaboratively and intentionally choosing student learning and career development as our highest collective priority. All you’d have to do is follow the headlines in three of my previous posts to see the opportunity in front of us: The Future of Work in the Tourism Sector Starts at School (Oct 2019), Industry x Education Must Address Labour Shortages (Feb 2020), and Tapping the Tourism Pipeline (Nov 2020).
So how do we blend both worlds without redundancy and complexity? How do we leverage the best aspects of our industry and the best aspects of our higher education system so those who choose to study tourism-related programs can develop knowledge and skills? Let’s start with blurring the lines between the workplace and the classroom and explore the realm of WIL—work-integrated learning.
What Is Work-Integrated Learning?
Co-operative Education and Work-Integrated Learning Canada (CEWIL) is the lead organization for work-integrated learning in Canada. They define work-integrated learning as a form of curricular experiential education that formally integrates a student’s academic studies with quality experiences within a workplace or practice setting. WIL experiences include an engaged partnership of at least: an academic institution, a host organization, and a student. WIL can occur at the course or program level and includes the development of student learning objectives and outcomes related to: employability, personal agency, knowledge and skill mobility, and life-long learning.
Types of Work-Integrated Learning
There are actually a wide variety of WIL types and activities students, academic institutions, and employers can engage in. According to CEWIL there are nine different types, four of which have particular relevance for hospitality and tourism students and employers as we fight to emerge from the COVID-19 pandemic. These include:
- Co-operative Education: Work terms provide experience in a workplace setting related to the student’s field of study. The number of required work terms varies by program; however, the time spent in work terms must be at least 30% of the time spent in academic study for programs over two years in length and 25% of time for programs two years and shorter in length.
- Field Placement: Provides students with an intensive part-time/short-term intensive hands-on practical experience in a setting relevant to their subject of study. Field placements may not require supervision of a registered or licensed professional and the completed work experience hours are not required for professional certification.
- Internships: Usually offer one discipline-specific, supervised, structured, paid or unpaid, and for academic credit work experience or practice placement. Internships may occur in the middle of an academic program or after all academic coursework has been completed and prior to graduation. Internships can be of any length but are typically 12 to 16 months long.
- Work Experience: Intersperses one or two work terms (typically full-time) into an academic program, where work terms provide experience in a workplace setting related to the student’s field of study and/or career goals.
Available Funding Through Propel
In August 2021, Tourism HR Canada launched Propel, a program funded by Employment and Social Development Canada through the Student Work Placement Program (SWPP). Propel offers employers a wage subsidy of up to 75% of a qualifying student’s wages, to a maximum of $7,500. Students enrolled at a recognized post-secondary institution can apply for a paid position to fulfil the work-integrated learning component of their program.
Our Canadian tourism industry has been given a truly unique opportunity thanks to Tourism HR Canada. Some version of the federally funded SWPP has been around for as long as a decade, although it has taken on different names over the years. This is the first year the program was approved for the tourism industry at-large. We need employers, academic institutions, and students to come together to take advantage of this incredible and important opportunity.
While it is quite a simple formula, the implications are profound. An embodiment of the aforementioned collaboration. Students gain paid hands-on learning and mentoring in their field of study. Employers acquire much-needed early talent to help with the recovery of the industry, as well as assistance with wages after an 18-month stretch of little or no income. Higher education institutions complement their programming by connecting students and the workplace.
So, if not now, when? And if you are still left asking “why?”, let me wrap up this piece where we started. The Canadian tourism industry has always relied on the higher education system for talent. Our industry employs students enrolled in a variety of programs as seasonal or part-time staff, and we hire students who have intentionally chosen tourism-related programs trying to build their careers in our sector. The Canadian higher education system is truly world-class and can be an ally in the ever-present struggle for talent.
Make no mistake, we are in the throes of a fully fledged talent war. Let’s help the next generation of tourism industry leaders launch their careers by joining forces. We can bring industry and education together through Propel, determination, and sheer WIL.
Joe Baker is a passionate leader within Canada’s tourism, hospitality and education sectors and a vocal advocate for a resilient, inclusive, future-forward industry. He is CEO of Joe Baker & Co., a human capital consultancy focused on strengthening hospitality and tourism organizations and people. Baker was dean at Centennial College’s School of Hospitality, Tourism and Culinary Arts where he led the most significant transformation in the school’s over 50-year history. He serves on the board of directors at Tourism HR Canada, Tourism Industry Association of Ontario and is on the editorial advisory board for SUSTAIN Magazine.
Joe can be found everywhere @thejoebaker.
Tourism HR Canada will soon be launching a new skills development initiative, Destination Inclusion. Coordinated in conjunction with partners World Skills Employment Centre and the Ottawa Community Immigrant Services Organization (OCISO), this program will offer learning and mentorship opportunities to racialized individuals in communities across Eastern Ontario.
Destination Inclusion participants will have free access to specialized skills assessments and customized training to enhance their technical, essential, transferable, and cultural competencies. They will have the opportunity to:
- Enhance transferable skills and language competencies
- Achieve better employment outcomes by acquiring industry-needed skills
- Explore a variety of career opportunities and paths in the tourism sector
- Access a broad support network and mentorship opportunities
- Obtain greater confidence and self-esteem in workplace settings
- Gain understanding of the tourism sector and Canadian workplace culture
The program will focus on three tourism-related learning streams: cooking, front desk, and housekeeping. A skills assessment will provide guidance on a suitable stream for each participant, but they are welcome to choose any or all that are of interest. The programming will all be offered online, through flexible, self-directed e-learning modules and supplementary micro-learning assets.
Destination Inclusion will also offer participants mentorship support, connecting them directly with tourism professionals. This will foster discussions around employment pathways in the industry, provide networking opportunities, and build an understanding of the many prospects available as the sector recovers from the pandemic.
Participants meeting these criteria are eligible for the Destination Inclusion program:
- Self-identify as a member of a racialized group
- Reside in Eastern Ontario
For participants whose first language is not English, meeting of level 5 or higher on the Canadian Language Benchmark (CLB) or the International English Language Testing System (IELTS) is recommended.
Virtual information sessions will be held throughout the fall, with participant programming launching in early October.
For more information on the program and the link to register for an upcoming information session, please visit the Destination Inclusion webpage.
Tourism-focused skills training is also available in other regions of Ontario:
OTEC offers Tourism SkillsNet North, which identifies workforce labour gaps specific to northern Ontario, designs responsive customized training to meet these specific needs, trains employees, and matches them with available job opportunities within Northern Ontario’s tourism sector.
Destination Toronto has just launched Hospitality EDGE, which offers a highly curated suite of online courses at no cost for workers in the hospitality sector in the Toronto, Mississauga, and Brampton area.
This Employment Ontario program is funded in part by the Government of Canada and the Government of Ontario
As public health restrictions lifted over the summer months, tourism employment grew significantly. In May, there were 1.55 million employed tourism workers. By August, that number had increased by 341,000, reaching almost 1.9 million employed workers. Despite this, the sector fell well short of the level of employment seen in 2019.
August represented the fourth month of employment growth in the sector. Since April, tourism employment has been steadily rising. This year the trend may continue into September. Still, seasonal trends dictate that tourism employment will decline once more in the fall despite reopened borders. Whether this is true for all industries within the sector remains to be seen.
Data was collected the week of August 15 to 21, 2021.
- Tourism employment grew by 85,600 in July and 99,300 in August to reach 1,892,900 employed workers.
- Employment gains were in full time and part time.
- Overall, employment in the tourism sector was still down 13.1% compared to August 2019, ranging from -7.2% in food and beverage services to -44.8% in the travel services industry.
- Compared to 2019, the total number of hours being worked is even lower than employment levels. This suggests that tourism workers are working fewer hours on average than they would have prior to the pandemic.
- Compared to 2019, August tourism employment ranged from -4.3% in Manitoba to -23.2% in Newfoundland and Labrador.
- Student employment in the latter half of summer was higher than in 2019.
- Overall, seasonally adjusted employment was still 0.4% lower this August than it was in 2019.
- Unemployment remains elevated. As of August, there were 461,400 more unemployed than in February 2020, the last month prior to the pandemic. There were 327,000 more unemployed workers than in August 2019.
- The number of people not in the labour force (e.g., not employed or looking for work) remains elevated. But, this is driven by those below the age of 25 and older than 65. The number of people not in the labour force who are between 25 and 65 is lower than before the pandemic.
Please note: To allow comparisons with tourism sector data, which sees significant employment fluctuations over the year, we use seasonally unadjusted data for both tourism employment and overall employment.
Tourism Employment Rate
In the summer months of 2021, tourism employment grew significantly. In May, there were 1.55 million employed tourism workers. By August, that number had grown by 341,000 to reach almost 1.9 million employed workers. The sector employed more people than last year, but remained well short of the level of employment seen in 2019. Of the workers who joined the tourism sector since May, 265,500 were full-time employees, and 75,500 were working part-time (defined as under 30 hours per week).
In three of the five tourism industry groups, employment grew in June, July, and August. The transportation industry lost workers in both June and July before seeing a recovery in August. Employment trends over the summer were mixed in the travel services industry, with employment losses in June and August, bookending an employment gain of 18.1% in July.
As of August, employment had not recovered to pre-pandemic levels in four of the five industry groups that make up the tourism sector. That said, summer has always been a time when employment grows significantly for some tourism industries, due to increased seasonal demand. Although it is good to see employment in the recreation and entertainment industry exceed pre-pandemic levels this summer, we need to take into account seasonal variation in employment levels.
When we factor in seasonal employment trends by looking at the same months in 2021 and 2019, we see that employment has a long way to go before it reaches pre-pandemic levels.
The good news is that compared to last year, employment is up—except for the travel services industry in August. Increased tourism employment relative to 2020 was expected. Despite shut-downs and the emergence of the Delta variant, vaccinations and a better understanding of required precautions allowed some level of reopening. However, the border only reopened to American travellers in late summer. Industries that rely more on other international travel markets are still seeing significantly suppressed employment levels.
Compared to the summer of 2019, employment is down in all industries. Employment recovered in August compared to July, thanks to the partial lifting of restrictions across the country. However, overall, employment in the tourism sector was down 13.1% compared to August 2019, ranging from -7.2% in food and beverage services to -44.8% in travel services.
Hours of Work
The total number of hours worked by employees in the tourism sector grew significantly relative to the same month in 2020. But like employment, hours significantly trailed the number of hours worked in 2019.
Compared to 2019, the overall number of hours worked in the tourism sector is lower than employment is. Employed tourism workers are working fewer hours on average than they would have prior to the pandemic. The decrease in hours suggests that some capacity exists for businesses to respond to labour shortages by increasing employees’ hours. However, this data could reflect changing work patterns. In August, full-time employment in tourism was down 16.4% compared to August 2019, while part-time employment was only down 5.9%. It may be that former full-time workers are working fewer hours because of weak demand due to COVID. But, it could be that full-time workers who lost their jobs did not return to the industry and have been replaced by part-time workers—who may not be seeking full-time hours.
Provincial Tourism Employment
Compared to last summer, tourism employment has increased in most provinces, with the notable exceptions of Newfoundland and Labrador and Quebec. Tourism employment in New Brunswick was lower compared to 2020 at the start of summer, but rose slightly higher in August.
Tourism employment was particularly robust compared to 2020 in Prince Edward Island (up 17.9%), Ontario (16.8%), and Alberta (15.4%).
In no province did employment come close to reaching 2019 levels. Generally, employment was higher in August than in July compared to the same month in 2019, with some exceptions, such as Newfoundland and Labrador and Prince Edward Island.
Compared to 2019, tourism employment in August ranged from -4.3% in Manitoba to -23.2% in Newfoundland and Labrador.
A key source of workers for the tourism sector are students who seek summer jobs. In 2020, student employment dropped dramatically. The unemployment rate for full-time students stood around 25% in July and August and was almost 40% in May.
This year, student employment across the economy was low and unemployment rates were elevated in May and June. However, student employment trends looked quite normal in July and August. The number of students who were employed in July was only slightly lower than in 2019 and even rose above 2019 levels in August. The participation rate for students was roughly equivalent to the past two years, which means the pandemic did not discourage students from joining the labour force in 2021. Most importantly, the unemployment rate for students in 2021 was similar to 2019. Those students who joined the labour force found jobs in roughly equivalent numbers to 2019. A loss of students from the labour force is not driving labour shortages in tourism, since they are as available as they usually are. However, they may be taking jobs in industries other than tourism.
Labour Force Trends
As we entered the summer months, the number of job vacancies in the Canadian economy surged, reaching over 815,800 in June. Data on job vacancies within the tourism sector are not available. Still, within the accommodation and food services sector, employers were seeking to fill 130,000 vacant positions. The vacancy rate—the percentage of vacant positions relative to employed workers—was a staggering 12.7%. In other words, there was more than one vacant position for every ten employed workers. In the arts, entertainment and recreation sector, 16,355 jobs were vacant, giving that sector the second highest vacancy rate of 8.3%.
Labour Force Trends
As we leave summer 2021 behind us, economy-wide labour force trends will become a greater concern, and will feature more prominently in these reports going forward. The sector is entering the period where employment typically drops for many tourism industries. For the most part, Canada’s tourism sector is waiting until next year for demand to truly recover.
In the meantime, macro labour force trends will indicate how great future labour shortages could become. Currently, unemployment remains high and some young people are not actively engaged in the labour force. Despite the challenges facing business owners, there is slack in the labour market. That may not be the case by the time we start to hire for the summer of 2022.
Employment By Sector
Overall, seasonally unadjusted employment is up 1.8% from where it was in February 2020. But compared to the same month in 2019, employment still has not fully recovered to pre-pandemic levels. In August, total employment across the entire Canadian economy was 0.4% lower than in the same month of 2019.
In August, nine sectors had lower employment levels than they did in the same month two years ago, while seven sectors of the economy had higher employment. Notably, employment was up 9.4% in professional, scientific and technical services, and up 6.1% in the finance, insurance, real estate, rental and leasing sector. The sector with the greatest loss of employment in August was agriculture, which was down 16.5%. The decline in agricultural employment is notable because, until August, the greatest loss of employment has consistently been in the accommodation and food services sector. The growing employment losses in the agricultural sector are likely linked to difficulties employers face getting Temporary Foreign Workers (TFWs) into the country as well as challenges accommodating TFWs in the face of public health measures.
Total Unemployed and Unemployment Rate
Overall unemployment levels remained elevated in July, and despite an increase in employment, the number of unemployed workers increased in August. In the 14 months prior to the pandemic impacting Canada’s labour market, 1.15 million people were looking for work each month, on average. The unemployment rate ranged from 5.2 (December 2019) to 6.4 (August 2019), levels that indicate very limited slack in the labour market.
This July, there were 1.6 million unemployed workers. In August, that increased 2.8% to 1.65 million unemployed workers. As of August, there were 461,400 more unemployed than in February 2020, the last month before the pandemic. There were 327,000 more unemployed workers than in August 2019. This shows that there are people available and looking for work. But they are not necessarily filling jobs in the tourism sector.
Not in the Labour Force – Not Employed, Not Seeking Work
In August, the number of people who are not in the labour force (i.e., not working and not seeking work) declined. The decline was concentrated amongst those over the age of 25. The number of people over 25 not in the labour force declined by 116,000. However, the number of people aged 15 to 24 who were not actively engaged in the labour force increased in August by 40,200. This increase suggests that young people were discouraged by the job market. They either stopped seeking employment or left jobs they had and did not seek a replacement job.
Compared to the pre-pandemic era, the number of people over the age of twenty-five not in the labour force does remain somewhat elevated. However, this is entirely driven by those over the age of 65 (see figure 17). For those between 25 and 65, the number of people not actively engaged in the labour force has declined. This decline can be seen relative to the start of the pandemic and relative to the same month in 2019.
Reason for Not Seeking Work
Overall, the number of people who want to work but are not in the labour force remains slightly elevated. This implies that there are people who are not working who can be brought back into the labour force; however, the number is not great.
As demand starts to return to different parts of the tourism sector, businesses’ ability to find workers has become much more difficult than ever before. Even before the pandemic, the demand for tourism was growing faster than the ability of the labour force to supply enough workers to meet that demand. In November 2019, projections of long-term labour supply for tourism had found that 93,000 full-year tourism jobs would go unfilled by 2035.
Employment levels in the tourism sector usually decline in September. This year, because we are still reopening, it is likely that employment will grow slightly. However, come October and November, the seasonality that affects this sector will take hold and employment will drop once more. For the most part, our industry is still waiting until next year for demand to truly recover.
In the meantime, macro-level trends within Canada’s labour market will indicate the severity of labour shortages the sector will operate with next year. Currently, unemployment remains high and some young people are not actively engaged in the labour force. Despite the challenges facing business owners, there is some slack in the labour market.
That may not be the case come spring of 2022.