Why vacancies go unfilled when unemployment is high

Skills don’t match employers’ needs well, say Janet Lane and Christopher Rastrick.

Alberta’s population is growing more than twice as fast as the rest of the country’s, and its unemployment rate remains high — yet, there are still roughly the same number of job vacancies across the province as there were two years ago. Something doesn’t match up. In a difficult economic environment, it seems likely many Albertans would be scrambling to take any kind of work, which would reduce the number of available jobs. But, while many Albertans are indeed accepting jobs that were not on their radar two years ago, a surprising 44,000 jobs remain unfilled.

Meanwhile, the unemployment rate is up to 8.8 per cent (at time of writing), a full two per cent higher than the national average. And, the latest census numbers show that, despite the economic downturn, over the last five years Alberta’s population has grown at a rate of 11.6 per cent compared to the national rate of five per cent.

In Alberta, job vacancies are clustered in a few sectors. Hotels and restaurants are having a particularly hard time finding workers — there’s a five-per-cent vacancy rate in the accommodation and food services sector. Similar trends can be found in the information, cultural, finance and insurance industries.

Geographic disparities may be in play, meaning there are not enough qualified workers living in a particular area to fill the available jobs. Hotels and service businesses in Banff know this all too well. However, there is another, significant possibility that’s leaving tens of thousands of jobs needlessly unfilled: A mismatch between what are assumed to be the skills of the labour force and the skills Alberta’s employers are looking for.

What might actually be happening is many of Alberta’s job vacancies remain from chronic shortages that persisted before — and may continue to persist after — the current downturn. Even if the price of oil skyrocketed back to $100 a barrel, the help wanted signs would not disappear.

If these jobs have been chronically hard to fill, we should change the way we go about trying to fill them. Using a competency-based approach to define the requirements of available jobs, and to recognize the many capabilities that people have developed but do not include in their resumes would help.

Competencies are the skills, knowledge and attributes that are needed to know, do and understand the tasks of a particular job. A credential such as a degree or certificate identifies what a person has been taught or trained to do; competencies represent what a person is actually capable of performing, and to what degree.

Knowing what a prospective worker can really do, how well they can do it, and what is needed to upgrade their tool kit would be a huge benefit to employers. This kind of information would also be highly useful for people looking to find a job, or to upgrade and expand their skill set. But right now, most employers use credentials as a proxy for what workers can do. This can result in employers not having competent people or hiring over-qualified workers, but then under-utilizing them.

This vicious cycle leads to the decline of workers’ skills through their professional lives.

With Alberta’s growing population, using competencies as a basis for hiring would not only benefit workers already here, but also those who are considering moving to the province. By knowing the competencies that Alberta employers are looking for, new Albertans would know which positions they are best suited for, and even which competencies they might need to develop prior to their arrival.

If employers can identify the competencies they need, and workers are aware of their competency inventory, Alberta will be in a better position to match workers with jobs and jobs with workers, an employment winwin. Having the right number of workers is just the starting point to a robust labour force. Ensuring Alberta’s workforce matches the needs of employers is crucial.

An upcoming report from the Canada West Foundation shows how the rest of the world is increasingly moving toward a competency-based approach to workforce development and deployment. With a growing population, above-average unemployment and some hard-to-fill jobs, now would be a good time for Alberta to get on board.