April 25, 2024

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With lower salaries and less remote work, the job market looks very different: ‘Now probably isn’t the best time to make a leap’

5 min read
With lower salaries and less remote work, the job market looks very different: ‘Now probably isn’t the best time to make a leap’
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Jerome Jones inside his home in Chatham, Ont., on Oct. 27. Jones is looking for a new job and finding the market slower than previous times.Brett Gundlock/The Globe and Mail

When Jerome Jones was looking for a job in mid-2022, he had about 15 interviews a week, mostly for remote roles in project management, sales and leadership. He got a position fairly quickly, but was laid off in September when his company restructured.

Now he’s looking again, but this time, amid widespread tech layoffs and a higher unemployment rate, he’s only getting an interview or two each week.

“I’m looking for the same jobs, something remote in my field, but most of the companies I’m looking at now are hesitant or reluctant, trying to pull back from remote work,” says Mr. Jones, 33, who lives in Chatham, Ont., a small town without the type of companies he has worked for in the past. “Now probably isn’t the best time to make a leap.”

People who looked for jobs last year, or even earlier this year, will be surprised at how much has changed. The era when workers could score big raises by changing jobs, and companies competed for staff by offering flexibility and perks, seems to be ending, says Toronto career coach and tech recruiter Jermaine L. Murray.

Many businesses are “attempting to do a hard cultural reset,” he says. “Companies are using the excuses of the economic times to do a culling of sorts: pushing anti-employee agendas, forcing return-to-office and posting salaries that are a lot lower than they were a year ago.”

Analysis of Canada’s gross domestic product by Capital Economics last month described the country as “on the cusp of recession,” while a recent Mercer report found Canadian companies were planning more modest pay increases in 2024 compared with this year.

The Conference Board of Canada’s most recent Canadian Hiring Index, which is published monthly, suggests finding workers is getting easier. It also found wage growth is decelerating – although at a slower pace than experts expected, Conference Board economist Liam Daly says.

“Workers are moving between jobs less frequently than they were a year ago, indicating people are growing a little less confident at finding better employment somewhere else,” he said, noting the organization expects unemployment to continue to rise until mid-2024. Mr. Daly also noted an increase in “involuntary part-time” work.

“It’s a sign we’re seeing workers not quite being able to find another job that suits them better or obtain hours they would like to in their current job,” he said. “If we went back six months in time, that would be a more favourable time to be switching jobs.”

Statistics Canada data show unemployment is affecting young workers most, something Mr. Murray says he is seeing when it comes to people searching for entry-level jobs.

“I haven’t seen it this hard for entry-level people since 2008,” he says, noting some job seekers who have been laid off are settling for new positions below their level of experience, which is, in turn, creating a crunch for the least-experienced workers. He’s also seeing increased levels of burnout. “People were burnt out prior to the layoffs, and it’s gotten even worse now, because companies are using leverage of the economy to deny promotions but double the workload.”

For employed people considering making a change, Mr. Murray says it’s a good time to focus on skills development in order to be better positioned when the next boom comes.

That said, if the right job comes up, “I’m not telling them to sit tight. I’m telling them, ‘It should take a lot more to move you,’ ” he says. “You need to ask them how they know they’re going to be in business in six months. ‘How can you give me assurances that you’re not going to lay me off?’ ”

Koula Vasilopoulos, senior district president with staffing consultancy Robert Half in Calgary, says job seekers should “be exceptionally clear about what it is you are looking for and what it is you’re not getting” when debating a change during a riskier time in the economy.

Ms. Vasilopoulos says workers accustomed to the quick pace of hiring as the job market rebounded from COVID-19 lockdowns will have to temper their expectations. Her organization’s research has found the time it takes to hire someone has increased by 75 per cent since 2021, when it was eight weeks. Now it stands at 14 weeks, she says. “We were telling companies ‘You’ve got to move.’ Now we’re educating employees to be patient.”

For many of financial planner Andrea Thompson’s clients, the idea of searching for a job in times when they’re already struggling with inflation and interest rates is too stressful to even consider. But Ms. Thompson, who’s based in Mississauga, says that for people whose job is seriously affecting their mental health, it can be worth it to take the risk.

“Short-term needs are so important because, emotionally and psychologically, they get you a lot further,” she says, noting there are ways to arrange one’s finances that can help prepare for a period of instability. Before leaving a job, she recommends cutting down on investing for a few months and putting that money in a vehicle with easy withdrawals, such as a tax-free savings account.

“Then if you get that job, put a lump sum in later on,” she says, noting she’s also advising clients to focus more on debt payment than savings these days, now that interest on borrowed money is so expensive.

Making these kinds of changes to our money plans can feel scary, she adds, but it doesn’t have to be permanent. “At some point in time, things will start to flip back the other direction and we can relax a bit.”


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