This report is a regular tool for HR professionals in Alberta. Good labour market information can help human resources practitioners make better decisions in giving human resources advice to their stakeholders. Alberta companies are facing a significant labour and skills shortage. Earlier in the year, the Alberta government estimated that the province could be facing a shortage of
96,000 workers by 2023.
As a recent IRPP report published by Don Drummond 1 , the former chair of the 2009 federalprovincial-territorial Advisory Panel on Labour Market Information, noted that better information helps employers, employees and governments make better decisions. The HRIA commissioned this second report as part of a regular series to help fill that labour information void for its members and to discover industry benchmarks that can help human resources professionals make better talent management decisions.
The HRIA has created a measure of how Albertan employers feel about hiring over the next six months. The index emphasizes how confident HR professionals are that they can hire the right people to fill open positions, it also incorporates views on growth in the number of positions.
60.1
60.8
58.8
58.4
58.0
55.4
Overall Small Business Medium Business Large Business Oil and Gas Professional
Services
First 6 months Next 6 months
Overall, there has been a slight increase in the Hiring Confidence Index in the early part of 2014.
The biggest increase was among medium businesses (+0.8) while small businesses (-1.3) and oil and gas (-1.0) saw a drop. Large business was the only category left unchanged leaving it far behind oil and gas. Alberta’s small businesses have softened their expectations for the next 6 months while the outlook for oil and gas looks promising. Large businesses outside the oil and gas sector saw no change in their hiring outlook maintaining a significant gap with the oil and gas
1 See Wanted: Good Canadian Labour Market Information, by Don Drummond, published June 11, 2014.
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sector. Large employers outside of oil and gas are facing strong competition for talent with total compensation playing a significant role in this disparity.
The scores have a maximum value of 100 and a minimum value of 0. Scores of more than 50 means HR professionals are more confident about hiring than worried.
The hiring trend continues through the first half of 2014.
More than three times as many companies reported a net increase in employees as ones who reporting a net decrease. There is actually a slight increase since the last report. About a third of companies reported employment was stable. Companies with between 100 and 499 employees and those in the oil and gas sector were the most likely to have experienced growth.
Across all but one company sizes more people were hired than left in the last six months. Companies with between
1,000 and 9,999 employees saw net employment remain virtually flat over the first half of 2014. Results within categories based on numbers of employees in order to make the results relevant.
45%
Percentage of Companies
Reporting net increase in employment
55%
53%
48%
Number of Employees
Median number 1 to 99 100 to
499
5.4 27.7
500 to
999
53.8
1,000 to
9,999
122.7 Left employment in last six months
Joined employment in last six months
5.9 34.9 71.9 121.6
Over
10,000
210.1
225.2
2nd Half
2013
Overall Medium
Business
Oil and
Gas
Over the last six months employees left for a variety of reasons, with the most common being resignation for a better opportunity, resignation for personal reasons, and termination without cause. Resignation and termination without cause have both become more common compared to the second half of last year. While at the same time resignation for a better opportunity has become significantly less common.
What sort of employee is leaving for what different reasons?
In the early part of 2014, resigning for a better opportunity was the most common reason for departure. The only exception is Executives who were most likely to leave because of retirement.
Administrative staff are almost as likely to resign for personal reasons as to leave for better
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opportunities. It is probable that many workers took the holiday break to an opportunity to change employers and start the year fresh .
Most Common Reasons for Leaving
43%
29%
22%
Resignation for a better opportunity
Resignation for personal reasons
Category of
Employee
Executives
Managers
Most Common
Reason to Leave
Retirement
Resign to pursue better opportunity
26%
9%
11%
11%
2nd Half 2013
11%
16%
22%
1st Half 2014
Termination for cause
Retirement
Termination without cause
Professionals (i.e. engineers, accountants, HR)
Technical Staff (i.e. designers, technicians)
Tradesperson or
Journeypersons
Administrative or support staff
Resign to pursue better opportunity
Resign to pursue better opportunity
Resign to pursue better opportunity
Resign to pursue better opportunity
Finding replacements with the equivalent experience and qualifications is difficult. Confidence in finding replacements is low and has not changed significantly since late 2013. A third of respondents are worried they will not be able to replace departing workers with workers having the same experience and qualifications. Companies with more than 10,000 employees are more than twice as likely to be very worried they will not find replacements with the equivalent experience. Alberta employers continue to experience difficulties in finding the right people to fill their vacancies.
Almost three in five firms have not seen their business impacted by resignations and loss to retirement in the last year. Compared to last year more firms are saying they have not hit revenue targets due to resignations and retirements.
Confidence in replacing workers with equivalent experience and qualifications
25%
7%
12%
Very confident they will have equivalent experience and qualifications
Moderately confident they will have equivalent experience and qualifications
Neither confident nor worried
31%
25%
Moderately worried they will not have equivalent experience and qualifications
Very worried they will not have equivalent experience and qualifications
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57%
Impact of resignations and retirement in the last year
60%
50%
40%
30%
20%
10%
20%
17%
13% 13%
0%
No Impact
No Impact
We have not been able to grow as fast as planned
We have not been able to take on certain projects
We have not been able to take on certain projects
We have had to delay projects for clients
We have not hit revenue targets
We have had to delay projects for clients
We have not been able to grow as fast as planned
We have not hit revenue targets
Like in the second half of 2013 HR professionals have been active in reducing turnover and resignations. 74% of companies have taken action to reduce voluntary resignations in the last year.
The top three actions taken were better on-boarding (41%), flexible work arrangements (33%) and more team building events (32%). The actions taken have not changed significantly from the end of 2013. Improving the on-boarding of new employees is a straight forward method of improving retention and ensuring an effective transition into a workplace. HR professionals are trying different methods of keeping staff with a mix of different options being available.
41%
Better on-boarding
Flexible work arrangements
More team building events
Higher wages
Better benefits
Flexible work location
More vacation
Offer partial retirement options
Signing bonuses
Stock options
Outsourced functions
Living allowances
Job sharing
Replaced supervisors with high turnover rates
Reduce travel requirements
Other
None
4%
3%
6%
5%
7%
6%
6%
9%
8%
11%
13%
19%
28%
33%
32%
26%
1st Half of 2014 2nd Half of 2013
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Half of companies (49%) expect their total number of employees to increase over the next six months. This is an increase from 44% in the second half of 2013. Only 11% expect to lose employees over the next six months. The Oil and Gas sector expects to see the biggest gains
(59%) compared to only 33% in government and public administration.
Expected change in employment in the next six months
2nd Half 2013
Overall
Small Business
Medium Business
Large Business
Oil and Gas
Professional Services
Govt and Public Admin
22%
26%
8%
20%
30%
28%
38%
32%
26%
Increase by more than 5%
Decrease by less than 5%
22%
24%
23%
28%
20%
23%
22%
38%
36%
37%
33%
37%
28%
8%
6%
4%
4%
8%
7%
3% 2% 6%
7% 6% 4%
24%
27%
7% 6% 14%
7% 5% 5%
5% 2% 11%
11% 12% 6%
Increase by less than 5%
Decrease by more than 5%
Stay the same
Have no idea
Over the next six months companies expect resignation for a better opportunity to be the biggest reason why they will lose staff.
This has not changed from last year.
Expected reason for losing staff in the next six months
This is consistent with the positive hiring expectations that exist across the market. With unemployment at 4.6% in
May and overall employment up 3.2%
9%
14%
Termination without cause
Retirement year over year, Alberta’s economy continues its positive expansion allowing workers a greater amount of flexibility in the occupations they
31%
17%
Termination with cause
Resignation for personal reasons pursue and the specific employers they choose to work for.
Resignation for a better opportunity
Overall, professionals, tradespeople, journeypersons and administrative staff 19%
11%
Other are most commonly expected to have the highest turnover in the next six months. In the oil and gas and professional services sectors the expectation is for the most turnover among professionals. There is very low expectation of turnover among executives and to a lesser extent among managers.
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Expected departures by occupation in next six months
2nd Half 2013 2% 5%
Overall 2% 4%
18%
23%
19% Small Business 6% 2%
Medium Business 1% 4%
Large Business 10%
23%
36%
35%
Oil and Gas 3%
Professional Services 2% 43%
12%
8%
8%
13%
Govt and Public Admin 5% 11% 25%
16%
9%
21%
29%
5%
10%
14%
22%
21%
4%
33%
30%
21%
16%
18%
24%
7%
27%
19%
19%
22%
16%
14%
12%
2% 9% 25% 23%
Executives
Technical staff (i.e. designers, techs)
Other
Managers
Tradespersons & Journeypersons
Professionals (i.e. engnrs, accnts, HR)
Administrative & support staff
Companies were asked about the practice of temporary layoffs, whereby employees are laid off, but brought back on when business picks up again. This allows firms to retain a skilled and experienced workforce when cash flow issues arise and short term talent management decisions must be made.
About one in six firms engaged in temporary layoffs in the last six months, but this number increases with firm size. It is also a more common practice in the oil and gas industry.
Engaged in Temporary Layoffs in the last six months
Overall
Small Business
Medium Business
9%
16%
20%
82%
89%
79%
2%
2%
2%
Large Business
Oil and Gas
Professional Services
19%
23%
13%
76%
73%
88%
5%
3%
Govt and Public Admin 16% 84%
Yes No Don't know
The goal of temporary layoffs is for the staff to return to work before long, and in most cases that happens. 55% of staff return to work in less than three months, but one in ten of these temporary
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layoffs become permanent. Temporary layoffs can provide an opportunity for a company to reassess its labour pool and make necessary adjustments. It is also risky. Workers facing the prospect of a prolonged period out of work may leave permanently in pursuit of a more favourable work conditions and HR professionals must be careful to weigh the medium to long term downside to using temporary layoffs.
Length of time laid off before being typically called back to work
Overall 9% 46% 23% 12% 10%
Oil and Gas
Professional Services
Govt and Public Admin
10%
14%
50%
50%
43%
20%
33%
29%
10% 10%
17%
14%
Less than one month
Three to six months
One to three months
Six months to a year
It takes longer to fill a vacancy for a more specialized position like an executive than for a less specific role like administrative staff.
Over the last year it has taken more than six months to fill 34% of vacant executive positions. A majority of executive jobs took more than three months to fill. Managerial jobs and positions that require a professional did not take as long to fill with only 15% taking more than six months to be filled. Technical team members were easier to find, with only 7% of positions going vacant for more than six months. Even for skilled workers like journeypersons and tradespersons only 6% of positions took longer than six months to find someone. Compared to the last report, it is taking longer to fill executive and managerial positions, but the same or less time to fill lower paying positions.
While there may be a skilled trades shortage in Alberta, it is not impacting most firms. 82% of vacancies for trades or journeypersons are filled within three months.
Companies were also asked which positions remain unfilled. The responses varied enormously although the most common were in the managerial (project manager, marketing manager) and technical (QA technician, software developer) classes.
Unfilled vacancies if they persist over several months, or even a year, can have a negative impact on strategic business goals as well as other employees. Employees may have to shoulder
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an additional workload or take on tasks beyond their immediate areas of responsibility.
Prolonged delays in filling vacancies can also result in project deadlines being missed or opening hours being shortened in the retail sector.
Executives
Managers
Less than a month
34%
Between a month and three months
46%
22%
22%
Between three months and six months
Between six months and a year
27%
14%
8%
More than a year 12% 11%
4%
Professionals Technical Staff Tradespersons and
Journeypersons
Admin Staff
53%
52%
41%
56%
40%
16%
2%
8%
22%
24%
1%
6%
16%
41%
12%
1%
5%
1%
3%
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Turnover is expensive for companies. Costs associated with replacing an employee as well as lost productivity can be high. Broadly speaking the cost of processing a turnover increases with the size of the company. Oil and Gas, and Professional Services both pay more than average for turnover. The cost of turnover has decreased from late 2013, though this could partially be accounted for the sample including more responses from the Government and Public
Administration which as a sector have lower turnover costs.
Estimated average total cost of processing an employee turnover
$18,680
$17,870
$18,400
$17,280
$15,270
$14,970
$14,250
$13,310
2nd Half 2013 Overall Small Business Medium
Business
Large Business Oil and Gas Professional
Services
Govt & Public
Admin
Just like the second half of 2013, more than half of respondents reported increasing employee training needs due to turnover. Only 1% claimed a decline in training needs, while the rest (39%) say there has been no change. These numbers have not changed significant since the last report.
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Half of firms (49%) used an outside recruiter in the last six months. The highest use was among firms with between 500 and 9,999 employees, while those with over 10,000 employees were more likely to use internal resources .
Fewer firms anticipate using an outside recruiter in the next six months (41%).
100%
90%
80%
70%
60%
50%
40%
30%
20%
10%
0%
Use of an outside recruiter to fill vacancies
51%
42%
7%
In the LAST six months
58%
36%
5%
In the NEXT six months
No
Yes, for less than half of positions
Yes, for more than half of positions
As in the last report most companies in Alberta do not have a formal retirement policy. Only a quarter (27%) have a formal policy that outlines how retiring employees are to be treated including a step by step process that ensures both employer and employee understand their responsibilities. As firms get larger they become much more likely to have a formal retirement policy, with 56% of firms with between 1,000 and 9,999 employees and 70% of firms with over
10,000 employees having one. Governments are significantly more likely to have formal retirement policies.
Overall
Small Business
Medium Business
Large Business
Oil and Gas
Professional services
Govt and Public Admin
13%
23%
Have a formal retirement policy
27% 66%
81%
70%
59%
23%
16% 73%
72%
57%
39%
7%
6%
9%
4%
5%
10%
5% 39%
Yes No Don't know
Unlike retirement policies, nearly half of companies in Alberta (45%) have a formal succession planning process. Larger firms are more likely to have a formal succession planning process than smaller ones.
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Overall
1 to 99 employees
100 to 499 employees
500 to 999 employees
1,000 to 9,999 employees
Over 10,000 employees
Oil and Gas
Professional services
Govt and Public Admin
Have a formal succession planning process
45% 55%
36%
37%
52%
48%
48%
66%
58%
35%
64%
63%
48%
53%
52%
34%
42%
65%
8%
13%
5%
2%
11%
5%
4%
9%
8%
Yes No Don't know
Of those firms that do have a formal succession planning process, more than two thirds (69%) say that retirements have not affected their succession planning. Only 5% say retirements have had a great deal of impact on their succession planning and another 27% report it has had a moderate amount. The chances that retirements have impacted succession planning increases with the size of the company.
It is not possible to plan to for every eventuality, whether it be an unforeseen illness, a workplace or holiday accident, or early retirements; but succession plans ensure a measure of business continuity and should be relevant to replacing workers beyond just executives. As the baby boomers continue to reduce their workforce participation, employers will be pressed to find new workers to replace them and that process can be greatly streamlined by taking time with HR professionals to plan appropriately.
Eligibility for retirement in the last year hovers around 3% of employees for companies with less than a 1,000 employees and around 1.5% for companies with more than 1,000 employees.
Median number
1 to 99 employees
100 to 499 employees
500 to 999 employees
1,000 to
9,999 employees
Over 10,000 employees
Eligible for retirement in the last year
1.9 7.5 28 78 205
“Partial-retirement”, that is older employees transitioning to two or three days a week or less so that the company retains their experience and knowledge is practiced at about half the companies surveyed. It is more commonly found in larger companies and in professional service firms.
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Overall
Small Business
Medium Business
Large Business
Oil and Gas
Professional services
Govt and Public Admin
Is partial retirement offered?
49%
51%
44%
55%
38%
67%
43%
51%
49%
56%
45%
62%
33%
57%
Over 10,000 employees
75
36%
While half of companies do offer partial retirement, it is not that commonly used.
Median number
1 to 99 employees
100 to 499 employees
500 to 999 employees
1,000 to
9,999 employees
Number of “partial retirements“ in the last six months
1.1 1.7 3.4 12
When an employee transitions to “partial retirement” different companies deal with their position in different ways. The most common option is to fill the position with a full-time replacement. This option has increased significantly since the end of 2013. A significant number also leave the position open pending full retirement.
Generally, larger companies are more likely to fill the opening with a full-time replacement right away. Smaller firms are much more likely to leave the position open pending their full retirement.
How is the open position dealt with?
9%
13%
30%
There are over 338,000 international workers in Canada or
12%
1.1% of the Canadian workforce in 2012. The TFW program includes several different streams including the low skilled
It has been filled by a full-time replacement category that has been the source of many media stories and nationwide criticism. Recently, the Canadian
It has been filled by a part-time replacement
It has been left open pending their full retirement
It will not be filled again government announced significant changes to the way Other
TFWs are treated and this will have a significant impact on HR professionals tasked with dealing with the paperwork.
Overall, just less than one in five companies (19%) used TFWs in the last six months. In broad terms, firms with more employees were more likely to use TFWs than those with fewer employees.
Another 11% considered using TFWs in the last six months. This is a drop from the second half of
2013, and may reflect some of the controversy around TFWs that erupted in the media in early
2014.
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Used and considered TFWs
2nd Half 2013
Overall
Small Business
Medium Business
Large Business
Oil and Gas
20%
19%
11% 11%
20%
30%
17%
21%
14%
11%
12%
12%
66%
70%
78%
68%
58%
69%
71% Professional services
14%
8%
Govt and Public Admin 5% 95%
We used TFWs We considered, but did not use TFWs We did not consider using TFWs
Until the recent changes, TFWs had a four year cumulative limit on the length of time they could work in Canada. When that time is up, employers must plan to deal with replacing them. Twothirds of HR professionals surveyed said the most common plan is to obtain permanent residency for the TFWs (67%). The Canadian government has tripled opportunities for TFWs to become permanent residents and the Canadian Experience Class as well as provincial nominee programs are significant methods of retaining those workers. Only about one in six says they will replace them with Canadian workers (16%) while far fewer will apply to get new TFWs (4%). For the second report in a row not a single respondent said they would eliminate the position once the TFW left. Future survey work may show a dampening of interest in the program with the significant changes announced in late June that will increase costs, compliance measures and eligibility.
Plan to replace TFWs when maximum time is reached
2nd Half of 2013 15% 50% 16% 19%
Overall 4%
Small Business
Medium Business 7%
67%
69%
69%
16% 13%
15%
17%
15%
7%
Large Business 4% 58% 16% 22%
Apply for replacement TFWs
Obtain permanent residency for TFWs and retain them
Replace the TFWs with Canadian workers
Eliminate the position(s)
Looking forward to the next six months less than a quarter of employers (22%) will consider using
TFWs. This has shrunk from 28% last year. No doubt the controversy over TFWs in the media is having an impact and the expectation is that future intent to use will further decrease. Bigger firms are generally more likely to use TFWs, but the trend is downwards. As companies face new compliance requirements and further public scrutiny, it will likely cause HR professionals to spend
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more time ensuring that workforce planning strategies take into account the greater regulatory hardship that using the TFW program may cause. Turning towards underutilized domestic sources of labour as well as making business process modifications will be necessary for employers in certain sectors of the economy.
Consider using TFWs in the next six months
2nd Half 2013 13% 15% 27% 45%
Overall 12% 10%
Small Business
Medium Business
8%
14%
10%
8%
25%
30%
33%
57%
48%
45%
Large Business 14% 17%
We will definitely consider using TFWs
We will probably not use TFWs
28% 42%
We will probably consider using TFWs
We will definitely not use TFWs
Respondents were asked what outside trends are impacting their workforce including attraction, retention and HR practices.
The most common response was the competition for the best employees with other firms and industries within Alberta’s hot labour market. Respondents were carefully watching for the expected changes to the TFW program and how the Canadian government would handle the issue going forward. Also mentioned is the trend of working longer hours but fewer days, and the rise of compassionate care leave in packages (likely in conjunction with the passage of a private members bill in Alberta on the subject in February of 2014).
This survey was conducted online between May 1 and 22, 2014. 5,456 members of the HRIA were invited to participate via an email. Of these 729 completed enough of the survey for their responses to be useable, a response rate of 13.4%. 441 respondents completed every question, a completion rate of 8.1%, an increase over the previous report. The margin of error of this survey varies depending on the number of completions each question received. The margin of error varies between +/- 3.4%, nineteen times out of twenty and +/- 4.5%, nineteen times out of twenty.
The previous report was based on data collected in November and December 2013.
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The respondents come from organisations of all sizes from sole-proprietors to multi-national corporations. The median number of employees in Alberta per company is 185 and the average number of employees is 1,513. The respondents are fairly evenly distributed by the size of company. The largest number of employees reported is the government of Alberta with 254,000.
Number of employees
Self-employed 21%
1 to 99
100 to 499
19%
26%
500 to 999
1,000 to 9,999
11%
24%
Over 10,000 8%
Respondents were also distributed across a wide range of sectors. The most common were Oil and Gas; Professional, scientific and technical services; and public administration and government.
Distribution by sector
Oil and Gas
Public Administration and Government
Professional, Scientific, and Technical…
Construction
Education Services
Healthcare and Social Assistance
Finance and Insurance
Manufacturing
Retail and Wholesale Trade
Hospitality and Food Services
Transportation and Warehousing
Utilities
Mining
Real Estate, Rental and Leasing
Agriculture and Forestry
Information and Cultural Industries
Arts and Entertainment
Other Services
1.0%
0.6%
0.4%
0.3%
0.3%
2.8%
2.5%
2.2%
7.1%
6.7%
5.6%
4.9%
4.5%
6.0%
11.2%
10.6%
19.2%
14.1%
0.0% 4.0% 8.0% 12.0% 16.0% 20.0%
Due to the sample size the only sectors that can be broken out with separate results are Public
Administration and Government; Professional, scientific and technical services; and Oil and gas.
Respondents were divided between being Certified Human Resource Professionals and other categories. 56.1% of respondents were CHRPs.
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The Human Resources Institute of Alberta was founded in 1984 and is the governing body for the training, certification and promotion of Alberta’s human resources professionals. With over 6,000 members, the HRIA is Alberta’s only human resources professional body with 6 chapters across
Alberta providing support to members in every major urban centre.
For more information contact:
Phone: 403-209-2420
Email: info@hria.ca
www.hria.ca
For media inquiries, contact:
Temina Lalani-Shariff
Director of Communications
Phone: 403-541-8707
Email: tlalanishariff@hria.ca
For inquiries regarding the survey and analysis, contact:
Tom Kmiec
Director, Corporate Affairs
Phone: 403-541-8714
Email: tkmiec@hria.ca
For inquiries regarding the methodology and survey tool, contact:
Hamish I. Marshall
Abindgon Research
Phone: 778-835-3715
Email: hmarshall@abingdon.ca
HUMAN RESOURCES INSTITUTE OF ALBERTA
#410 , 11 11 - 1 1 Ave nu e S W Ca l ga ry, AB T 2R 0 G5 | 403. 209 .2 420 | 80 0 .668 .6 125 | f 403 .2 09 .24 01 | www.HRIA.ca

Abingdon specializes in large membership surveys and economic/public affairs oriented projects. The company’s past work has included labour market studies of western Canada evaluating labour shortages and relative pay rates for employers. Based in western Canada, Abingdon boasts past clients such as the
Port Metro Vancouver, BHP Billiton, the Calgary Chamber of Commerce, municipalities from British
Columbia to Ontario, as well as major media organizations in British Columbia and Alberta.
HRIA is the leading professional association for human resources practitioners in Alberta dedicated to strengthening and promoting the HR profession. As Alberta’s exclusive granting body for the Certified
Human Resources Professional (CHRP) designation, HRIA plays a critical role in establishing professional standards within the industry. The HRIA membership connects over 5,900 HR practitioners, including 3,100 + CHRPs across the province through various professional development, networking, and community initiatives.
#410, 1111 - 11 Avenue SW Calgary, AB T2R 0G5 | 403.209.2420 | 800.668.6125 | f 403.209.2401 | www.HRIA.ca