Overview
| Name | Modèle de prévision de l'état d'équilibre du marché du travail par profession (Quebec labour market outlook by occupation) |
| Author | Direction de l'analyse et de l'information sur le marché du travail (Labour market analysis and Information directorate)
Emploi-Québec Ministère du Travail, de l'Emploi et de la Solidarité sociale (Ministry of Labour, Employment and Social Security) |
| Contact | lassad.damak@mtess.gouv.qc.ca |
| Timing | Five and ten year forecasts, updated annually |
| Outputs | Latest report available here |
Emploi-Québec, a department of the Ministère du Travail, de l’Emploi et de la Solidarité sociale (MTESS), produces medium- (five year) and long-term (ten year) forecasts for the labour market. The model projects labour supply and demand, and the surplus/deficit status for 500 4-digit National Occupational Classification (NOC) occupations in Quebec for 16 economic/administrative regions (Côte-Nord and Nord-du-Québec are combined for this exercise), as well as the two census metropolitan areas of Montréal and Québec City.
Methodology
Projection of Labour Demand
For each occupation and year of the projection period, expansion and replacement demand are projected and and summed as the number of job openings.
These estimates are based on the medium- and long-term macroeconomic forecasts of the Conference Board of Canada (CBoC). Emploi-Québec ses an econometric tool based on CBoC’s specifications - which incorporates the production equations from Statistics Canada’s input-output matrix - tobreak down the CBoC’s Quebec GDP forecasts by industry and year. Then they and incorporate the demographic projections from the Institut de la Statistique du Québec (ISQ) for each region.
- Gross domestic product (GDP) by industry (41 North American Industry Classification System [NAICS] sectors), by year (not public) (A).
Emploi-Quebec first estimates labour productivity by industry for each year of the projection period based on the historical trend. For the medium-term (five years) and long-term (ten years), estimates of labour productivity by industry or group of industries are done
Employment is by industry for the province, the 16 regions and the two major census metropolitan areas, Montréal and Quebec City is projected based on the historic share of employment in each region in relation to the province’s employment. For several industries, regional employment forecasts are adjusted according to projected demographic changes.
Finally, Emploi-Québec estimates employment by industry at the provicinal and regional levels for each year of the projection periodby dividing the GDP in each industry by its projected productivity. The total forecasted employment for each year corresponds to the sum of industriall employment in each industry:
- Employment by industry (41 NAICS sectors), by year (not public) (B).
The employment is then split among 41 industries and 70 occupational and for each forecast year. The occupational groups arecomposed of combinations of 2-digit and 3-digit NOC occupations. A dynamic matrix is produced using employment by industry and occupation data from the Labour Force Survey (LFS), which is combined with the data from the latest census for Quebec and for each region:
- Employment by occupation (70 NOC groups), by region, by year (not public) (C).
Replacement demand forecasts the number of workers who are no longer in their positions because of retirement, interoccupational mobility (changing occupation) or in-service death. It is calculated using data from LFS. The model projects the movements in and out of occupations by comparing the levels of employment for three age groups (15-19 years, 20-24 years, up to 65-69 years) at year one and year five of the projection period. It calculates historical replacement rates from 1992 (i.e.: replacement between1987 and1992) to 2018. The model estimates net outflows by age group to assess the expected replacement rate for each occupation. This rate is assumed to be identical for all regions. Replacement demand is then obtained by multiplying the rate by the projected volume of employment in the occupation.
- Replacement demand by occupation (500 4-digit NOC occupations), by region and by year (not public) (D).
Summing expansion and replacement demand yields the following:
- Job openings by occupation (500 4-digit CNP occupations), by region and by year (not public) (E).
Projection of Labour Supply
The labour supply projection is based on two elements: expected immigration and entrants from the school system.
Supply from Immigration
For this forecast, only permanent immigration entries are considered. The supply from immigration is calculated using historical administrative data from the Ministère de l’Immigration, de la Francisation et de l’Intégration (MIFI) on new immigrants. Since there is often a delay in the release of administrative data, the number of new immigrants is "nowcasted" to the projection start date.1 Only those aged 15 and over are included in the calculation. A participation rate for the population aged 15 and over is applied to the projection to keep only the labour force.
New immigrants looking for work are then allocated to NOC occupations using an econometric model applying administrative data from MIFI and the last available census. New immigrants are also allocated to different regions based on the share of recent immigrants (i.e., those who immigrated five years ago or less) in the total labour force based on the last available census data.
- Number of new immigrants by occupation (500 4-digit NOC occupations), by region and by year (F).
Supply from the Educational System
The future supply of school leavers looking for work is obtained from the ministère de l’Éducation et de l’Enseignement supérieur (MÉES) projections of enrollments by education level and program. This data is obtained by applying a series of parameters and assumptions to enrollment and graduate forecasts (mainly from MÉES Relance surveys), such as the enrollment and graduation rate by program, the rate of graduates entering the job market, and the proportion of those who dropped out of school and would be entering the job market.
The projection of the number of school leavers is then distributed to occupation by multiplying the number of graduates of the different programs by conversion matrices (program of studies to NOC).
- Number of school leavers by occupation (500 4-digit NOC occupations), per year (I).
Identification of Imbalances
Forecasting labour supply and demand by occupation is conducted for Quebec at the provincial and regional levels, and is confirmed by Services Québec regional economists.
Imbalances for each occupation are identified for the medium term (not by year but for the entire projection period, such as 2019-2023) and for the short term (for one projection year, which is usually the second year in the three year range; e.g., 2020 for the 2019-2023 projection ). Figures are based on the projected labour demand (number of job openings) and the projection of the number of new job seekers, along with an evaluation of the current state of the labour market.
Current State of the Labour Market
An initial assessment of labour market imbalances by occupation is carried out for the current year (2018 for the 2019-2023 projection) on the basis of an array of labour market indicators, such as the number of vacant positions, unemployment rate by occupation, etc.
The labour supply rate is calculated as the ratio of the number of unemployed persons to the labour force from the latest LFS data available for all of Quebec and all occupations. This rate is then broken down by occupation and regions according to unemployment trends for the last available census data and their evolution between the last census and the latest LFS data available:
- Labour supply rate by occupation (500 4-digit NOC occupations), by region, for the current year (J).
Future Supply and Demand Imbalance
Labour Demand Rate
The initial labour demand rate is calculated as the total of the change in employment due to economic growth or decline (B) and replacement (C) divided by employment in the base year. The rate is calculated for each occupation, region and projection year and the total of the five years:
- Labour demand rate by occupation (500 4-digit NOC occupations), by region, by year, and the total of the five years (K).
The initial labour demand rate is calculated as the total of the change in employment due to economic growth or decline (B) and replacement (C) divided by employment in the base year. The rate is calculated for each occupation, region and projection year and the total of the five years:
- Labour demand rate by occupation (500 4-digit NOC occupations), by region, by year, and the total of the five years (K).
Labour Supply Rate
The labour supply rate is then calculated as the total of immigration supply (F) and school leavers (I) divided by employment in the base year. The rate is calculated for each occupation, region and projection year and the total of the five years:
- Labour demand rate by occupation (500 4-digit NOC occupations), by region, by year (I) and the total of the five years.
Labour Imbalance Rate
The supply gap is calculated as the difference between total demand and total supply divided by employment in the base year. The rate is calculated for each occupation, region and projection year and the total of the five years:
- Labour gap rate by occupation (500 4-digit NOC occupations), by region, by year (I).
Gap Analysis and Diagnostic Development
The labour gap rate (I) for each occupation in each region is compared to that of the whole job market (i.e., all occupations and the entire province). This analysis combined with the evaluation of the current state of the labour market (J) results in a preliminary distribution of the assessment into five categories: 1) shortage, 2) slight shortage, 3) balance, 4) slight surplus and 5) surplus.
Subsequently, a qualitative analysis is conducted by Services Québec regional economists, in consultation with the comités sectoriels de main-d’œuvre (CSMO), conseils régionaux des partenaires du marché du travail (CRPMT),, and various departments and organisms,to validate assessments. This qualitative analysis includes reviewing the previous year’s major events in the area (e.g.,significant investments, massive layoffs), recent operational indicators (e.g.,number of vacant positions, number of social assistance and employment insurance beneficiaries). Additional studies and surveys, including graduate surveys, on the situation of certain occupations are also considered.
The three levels of employment opportunity by occupation and region - excellent, good and limited - are interpreted as follows:
Excellent
For an occupation with labour shortage, the probabilities of finding a job are said to be excellent when it is estimated that, for the period analyzed, the number of available workers will be insufficient to meet the needs of employers (labour shortage).
For a person with the required skills, or who would acquire them during the period analyzed, the possibilities of obtaining a job in this occupation are very high. This assessment should not, however, be interpreted as a guarantee of employment.
For employers, this means that recruiting and retaining workers will be difficult and they may have to adapt their recruitment strategy.
Job prospects can be excellent for a variety of reasons: strong job growth, high need for replacement due to high retirement rates, or an unsung occupationwith a small number of workers seeking it.
Good
For an occupation with a small need for workers, in balance, or with a slight surplus, the probabilities of finding a job are said to be good when it is estimated that, for the period analyzed, the number of available workers will be sufficient to meet the needs of employers (labour balance).
For a person with the required skills, or who would acquire them during the period analyzed, the probabilities of obtaining a job in this occupation are high. This assessment should not, however, be interpreted as a guarantee of employment.
For employers, good job prospects mean that recruiting and retaining workers will generally be without significant difficulties given the number of workers available.
Limited
For an occupation with a surplus of workers, the probabilities of finding a job are said to be limited when it is estimated that, for the period analyzed, the number of available workers will be more than what is required by employers (labour surplus).
For a person with the required skills, or who would acquire them during the period analyzed, the probabilities of obtaining a job in this occupation are lower. This assessment does not mean that it will be impossible to find a job, but that the job search strategy may have to be adapted to the context.
For an employer, limited job prospects mean that the recruitment and retention of workers will be easier.
Employment prospects are limited when weak or declining job growth is forecasted or when a large pool of workers is available (as when the unemployment rate is high for a specific occupation). This can be explained, for example, by technological changes or a slowdown in a sector of economic activity.
Applications
The Quebec labour market outlook model results are used in several contexts.
Individuals
- The website IMT en ligne makes results available for employment service providers, future immigrants and others.
- The website Emploi d’avenir uses the results to promote in-demand jobs.
Employment Policies and Programs
- Services Québec and its external network use the results to support employment services (e.g., job counselling).
- Emploi-Québec and Services Québec look to the report for information on both occupations to be promoted and training for vulnerable workers.
- Regional labour market partners councils (CRPMTs) use the information to help manage their programs (e.g., short-term training and grants promoting training programs for priority occupations).
- The Commission des Normes, de l’Équité, de la Santé et de la Sécurité du Travailuses the report to suggest new policy directions.
- The Ministère du Travail, de l’Emploi et de la Solidarité sociale uses the data to focus its trades and occupations promotion campaigns.
Immigration Policies and Programs
- The Ministère de l’Immigration, de la Francisation et de l’Inclusion (MIFI) uses the data to score training fields for selecting permanent immigrant workers.
- These forecasts are also used to establish the list of occupations eligible for simplified treatment under the Temporary Foreign Worker Program.
Education/Training Policies and Programs
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- The results guide the Ministère de l'Éducation et de l’Enseignement supérieur in authorizing and funding programs according to the higher and technical education supply management framework.
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- Results also inform the offer of scholarships for occupations with a labour shortage.
Economic Development Policies and Programs
- The results help Services Québec business advisers support employers (e.g., develop human resources plans).
Footnotes
1 For example, for the 2019-2023 projections, administrative data were available up to 2018period. The MIFI immigration plan data was used for 2019 (current year), 2020 and 2021. Emploi-Québec then forecast immigration for the following years.