3 Labour shortages could finally lead to wage growth ith the Canadian economy running close to full capacity in 2018, the bigger story was labour short- Wages. The national jobless rate hit a 44-year low 547,300 in November, and the latest data showed more than half a number of job million unfilled jobs, up nearly 100,000 from the same point in openings 2017. Businesses surveyed by the Bank of Canada and other groups consistently said they were having an increasingly in Canada tough time finding and hiring workers. * As of June 2018 There’s little relief in sight. Overall, employment rates remain two percent- age points below pre-recession heights, a situation unlikely to change due to the steady aging of the Canadian workforce. Retirement rates are steadily increasing, participation rates of youth (especially young men) remain flat or are declining, and women of prime working age continue to participate in fewer numbers than their male counterparts. Immigration has historically provided a significant source of new workers to Canada, but increases con- templated in the near term will likely be insufficient to satisfy the increase in demand for workers. Policies to bring more people into the labour force – expanded childcare programs or increased investments in work-integrated learning – could help address labour shortages. RBC Economics Research | Navigating 2019 - 9 big insights for the year ahead | January 2019 11