News

Economic impact: Nanaimo’s economy seems to be humming along

Henry Nguyen, filets salmon in the cutting line at St. Jean
Henry Nguyen, filets salmon in the cutting line at St. Jean's Cannery and Smokehouse. St. Jean's, along with other seafood companies and heavy duty equipment repair shops, on South Side Drive and Cadillac Place provide more than 350 non taxpayer-funded jobs in Nanaimo.
— image credit: CHRIS BUSH/The News Bulletin

New job figures have employers and employment agencies at least cautiously optimistic about Nanaimo's long-term economic outlook.

Statistics Canada employment figures released recently pegged Nanaimo's unemployment rate at just 4.2 per cent, well below the provincial average that has been floating between five and seven per cent for the last several months, and impressively trumping the 4.5 per cent claimed by Prince George where the resource sector is driving demand for skilled trades.

Sectors hiring in Nanaimo include retail, professional, scientific and technical services, construction, and arts and culture, said Sasha Angus, Nanaimo Economic Development Corporation CEO.

Local companies winning international contracts in the resource, manufacturing and professional/scientific sectors are looking for qualified workers, too.

"What tends to happen when they get those contracts is they need to staff up, particularly in the last couple of years," Angus said.

In Nanaimo, unlike northern B.C. and Alberta, jobs appear to be popping up right across the employment spectrum.

"You can't really point to a silver bullet and say, 'This sector has 80 per cent of the job growth,'" Angus said. "There's been a number of sectors improving over the past 18 months that have helped move it along."

But not all jobs employing Nanaimo residents are generated here. Like other communities across the province, Nanaimo is benefiting from what Angus calls the Fort McMurray Effect – workers commuting between homes here and resource extraction jobs in northern B.C. and Alberta. Employment out of town that can separate families for weeks or months at a stretch – be it jobs in commercial fisheries up through the 1990s or oil, gas and mining jobs in Alberta, South America or the Middle East where paycheques are earned, but spent here – has long been a part of the local employment picture, but still counts toward favourable Nanaimo job figures with Statistics Canada.

The statistical employment picture looked even rosier in Nanaimo when unemployment actually dropped to 3.3 per cent in December and likely represented a season pre-Christmas hiring blip.

"Even at roughly four per cent, you're still at virtually full employment. You can never get to zero," Angus said. "What we're tending to see over the last year or so is the transition from part-time jobs to full-time, which is encouraging because what it tends to signal is that employers are feeling confident in their business outlook."

The shift from part-time to full-time work means employees get medical and other employment benefits that provide even more spin-off benefits to the local economy.

Anne Russell, employment service centre manager with GT Hiring Solutions, a division of Work B.C., said the numbers for services the organization provides to clients don't necessarily reflect the overall employment picture for Nanaimo, but do show the sales and service sectors are providing most new jobs.

"That's consistent," Russell said. "In Nanaimo it's always that. Fifty-three per cent of the new jobs starts were in that sector."

The average wage for the sales and services sector is $12.62 per hour. The average wage for jobs overall in Nanaimo – skewed downward by the low-paying sales and services sector – was $14 per hour for the month of June.

"That group would have really brought it down because there are some good wages in business, health and trades," Russell said.

Russell is also seeing an overall increase in hours per week worked, indicating more people moving into full-time employment.

The business sector, Russell said, is providing less than two per cent of new jobs; the health sector, 11 per cent and the natural resource sector (fisheries and forestry related occupations) four per cent. Recreation, sport and culture are generating 13 per cent and trades are offering 17 per cent of new work available.

"If you go on the Work B.C. website for Nanaimo and just look at what's posted for right now you will see that there are quite a few knowledge-based jobs," Russell said. "There are jobs for the high-tech and for business and for health."

But during discussions with employers last fall, GT Hiring Solutions discovered companies often had to search off Island to fill those positions. Russell said many communities face similar labour force shortfalls, leaving local schools and training institutions playing catch up to meet the demands of labour market trends.

"It's always happening and it definitely happens in Nanaimo quite a bit," Russell said.

It's important for employers and employment agencies to know what age groups are looking for work, so surveys are taken at job fairs to get age statistics of job seekers. GT Hiring Solutions takes surveys at job fairs to gather demographic information about prospective employees, which can be useful for potential employers looking, say, to target certain age groups that can fit into a job requirement for skill and life experience levels.

At a job fair in Nanaimo in April, people 55 and older comprised 13 per cent of job fair attendees – a rise over figures gathered in January. Twenty-five to 40-year-olds made up the largest segment at 33 per cent of attending. Fifty-seven per cent of attendees were women. Sixty-six per cent of attendees had been looking for work for less than six months the remaining 34 per cent had been searching longer.

"Twenty-one per cent were underemployed or working, but they just wanted to look for another job," Russell said.

John Tait, job developer with Supporting Employment Transitions, also under the Work B.C. umbrella, said local employers are currently needing to fill administration positions, renovation construction jobs and manufacturing jobs.

"That being said, what I'm still seeing a lot of young with lack of experience finding it hard to find work," Tait said.

Tait, who looks after SET's Job Options program, which provides wage subsidies to help employers hire for positions, said employers are also not paying as much as they once did. With some employers unwilling or unable to pay enough to attract and keep employees, a lot of younger people have left Nanaimo to find work up north and once their EI runs out they drop off the unemployment statistics radar.

Underemployment is also prevalent. Tait sees young people with college education and university degrees forced to take low-paying service industry jobs.

"So, the overall thing is, yes, it's looking better and statistics imply that ours is low and nationally we look amazing, but the other side to it is they're lower-paying jobs and there are still people who are having a real tough time getting into the market for long-term, full-time employment," Tait said.

On the bright side activity in SET's wage subsidy programs is busier, Tait said, than has seen it in "a long, long time."

"That usually implies people are looking at hiring," Tait said. "That might bode well for the near future. Right now, though, there are still a lot of people having trouble fitting into that employment market."

SET's wage subsidy program encourages employers to hire less experienced workers and provide on-the-job training.

"Employers pay into EI just as much as individuals do, so they should know that they can benefit from these subsidies, too," Russell said.

Angus said the technical and scientific sector holds the most promise for longterm, sustainable economic benefits. The sector creates products and services that can be marketed anywhere from anywhere, which includes places like Nanaimo which has low commercial property and rental rates compared to the Lower Mainland.

"Most importantly – as part of that quality of life – we have really affordable workforce housing, whereas Vancouver and Victoria ... good luck trying to find waterfront or a place with a view of the water," Angus said. "On average our housing costs are maybe a third of what you'd find in the Lower Mainland."

Such long-touted benefits of living on the central Island are attracting high tech businesses which can come here, start out small with lower startup costs and just a few employees and grow as their markets develop. Entry level tech-sector jobs pay starting wages of about $60,000 annually.

"The more jobs we can help stimulate in the tech sector, the better off we are as far as our long term economic prospects go," Angus said. "One of the conversations we've been having with Innovation Island (Technology Association) is talking about how we foster a startup culture in Nanaimo. Innovation Island actually has some really great programming helping local entrepreneurs scale their businesses and ideas faster."

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