A review of BuildForce Canadas labour market model and background for Construction and Maintenance Looking Forward Introduction The purpose of this review is to review core concepts and the structure of the BuildForce Canada model ID: 690799
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Slide1
Labour Market Information
A review of BuildForce Canada’s
labour market model and background for
Construction and Maintenance Looking ForwardSlide2
Introduction
The purpose of this review is to:
review core concepts and the structure of the BuildForce Canada model
answer questions about
Construction and Maintenance
Looking
Forward
help participants see where their interests are identified
in
the system
explain the tables and figures in the
Construction and Maintenance Looking Forward
reports and PowerPoint presentations, including:
measures used, methodology and background
findings and interpretationsSlide3
Introduction
The purpose of the BuildForce labour market model is to:
track the state of construction labour markets across Canada
promote awareness and discussion about the state of markets and implications for industry and government initiatives
offer an analytical tool to industry participants (e.g., “what if?” simulations)Slide4
Introduction
The purpose of
Construction and Maintenance Looking Forward
is:
to provide annual reports (PDFs and PowerPoint presentations) on the state of construction labour markets in all provinces and territories, as well as five Ontario regions
The reports are based on:
a current macroeconomic and demographic scenario
a current inventory of major construction projects
the views and input of provincial labour market information
(
LMI)
committeesSlide5
Introduction
Construction and Maintenance Looking Forward
is
driven by a scenario-based analysis.
Each forecast is based on several important assumptions.
For
example:
global commodity prices
lists of very large construction projects in each province
and
territory
One set of these assumptions creates one “scenario.”
Each scenario is just one of several possible outcomes
.Slide6
Outline
Core concepts
Model structure
Market adjustments
Rankings and mobility
Frequently asked questionsSlide7
Core concepts
The core formulas are:
Labour force = Employment + Unemployment
Participation rate = Labour force
٪
PopulationSlide8
Core concepts
Stocks are measured at one point in
time. For example:
employment
labour
force
housing
stock
population
registrationsSlide9
Core concepts
Flows
measure the change in the stocks across a period of
time. For example:
investment
housing
starts
new
apprenticeship registrations
apprenticeship
completions
immigrationSlide10
Core concepts
Statistics Canada
measures:
T
he
reliability of labour market statistics is restricted by:
smaller markets and limited samples
respondents who self-identify
their occupation
and industry
employment attributed to region of residence
BuildForce
research and LMI committees improve
reliability.Slide11
Model structure
Labour markets in the wider economy
Demand
Investment in construction of new buildings and structures, renovation and repair work, activity in other industries
Construction
labour
m
arket
Supply
Population by age, gender, education, qualifications, source (natural increase or immigration), ethnicity and participationSlide12
Model structure
Labour markets in the wider economy
Macroeconomics
Demographics
Labour requirements (demand)
The available workforce (supply)Slide13
Model structure
Macroeconomics
International
United States
Canada
Provinces
Business investment
Government
Households
Other
Non-residential
i
nvestment
Commercial
Industrial
Engineering
Institutional
Residential investment
High rise
Low rise
Renovations
Tracking major
projects
Labour
requirements
(demand)
Trades
Occupations
ManagersSlide14
Model structure
Demographics
Population
Gender
Education
Birth rates
Mortality
Immigration
Age profiles
Participation
Mobility
Labour force
New entrants
Retirements
In-mobility
Post-secondary
p
rograms
The available workforce (supply
)
Trades
Occupations
Managers Slide15
Model structure
Labour markets in the wider economy
Demand – Macroeconomics
Supply
–
The available workforce
Construction
l
abour
m
arket
Employmen
t
Unemployment
Labour supplySlide16
Model structure
There
are two distinct sources of labour requirements (demand) in the model:
replacement demand related to retirement and mortality
expansion demand related to growth in construction activity
Replacement and expansion demand are measured
for
33 trades and occupations (see next slide)Slide17
Model structure
Boilermakers
Bricklayers
Carpenters
Concrete finishers
Construction estimators
Construction managers
Construction millwrights and industrial mechanics
Contractors and supervisors
Crane operators
Drillers and blasters
Electricians (including industrial and power system)
Elevator constructors and mechanics
Floor covering installers
Gasfitters
Glaziers
Heavy equipment operators (except crane)
Heavy-duty equipment mechanics
Industrial instrument technicians and
mechanics
Insulators
Ironworkers and structural metal fabricators and fitters
Painters and decorators
Plasterers, drywall Installers and finishers, and lathersPlumbersRefrigeration and air conditioning mechanicsResidential and commercial installers and servicersResidential home builders and renovatorsRoofers and shinglersSheet metal workersSteamfitters, pipefitters and sprinkler system installers TilesettersTrades helpers and labourersTruck driversWelders and related machine operatorsSlide18
Model structure
Expansion
demand is measured for:
Industry:
construction
all other industries
Provinces
and five Ontario regions:
Greater Toronto Area
Southwest Ontario
Central Ontario
Northern Ontario
Eastern OntarioSlide19
Model structure
Expansion demand is driven by construction spending
by
sectors:
residential
commercial
industrial
institutional
engineering
maintenanceSlide20
Model structure
Expansion demand is driven by construction spending
by
sectors:
the macroeconomic model forecasts spending
employment is reported for residential and non-residential totals
specialized analysis tracks project detailSlide21
Model structure
Building
requirements
Labour
requirements
Employment
Construction
Other i
ndustries
Available labour force
Managers
Contractors/supervisors
Trades
Apprentices
Unemployment
Annual
Peak
Natural
Mobility
Sector Region Industry
Youth
Women
Aboriginals
Immigration
Does
not identify people
by
trade and occupation
Identifies
people
by
trade and occupation
Population by age / retirement
Training apprenticeship
Available populationSlide22
Market adjustments
What happens when conditions change?
The model has three rounds of adjustments:
Unemployment changes
Labour force changes
Immigration, apprenticeship and other institutional
systems
adjust
The
unemployment rate is the first, pivotal point.Slide23
Market adjustments
Unemployment is an essential feature
of
the labour
market:
acts
as a cushion to absorb shocks
a
social cost across the cycle
creates
benefits in a balanced marketSlide24
Market adjustments
First round adjustmentsSlide25
Market adjustments
Unemployment
There
are three different measures:
Seasonal
Cyclical
NaturalSlide26
Market adjustments
Seasonal unemployment patterns in SaskatchewanSlide27
Market adjustments
Cyclical unemployment rates for Saskatchewan
Recession
PeakSlide28
Market adjustments
The normal unemployment rate estimates the annual unemployment rate in balanced markets.Slide29
Market adjustments
Unemployment rates, heavy equipment operators, SaskatchewanSlide30
Market adjustments
Second round adjustments
New
e
ntrants
Increased
participation
Other
regions
Other
industriesSlide31
Market adjustments
Change in the labour
force:
New entrants
Mortality
Retirement
Net in-mobilitySlide32
Market adjustments
Change in the labour force
New
entrants:
number of residents 30 years of age and younger entering the labour force for the first time
Determined by:
change in population (age 30 years and younger)
construction share of the workforce
labour market conditionsSlide33
Market adjustments
Change in the labour force
Mortality:
the number
of persons in the local labour force that pass away during the year based on age-specific mortality ratesSlide34
Market adjustments
Change in the labour force
Retirement:
the number
of persons permanently leaving the labour
force
persons
that take a pension and move to another trade or take contract work are not included
Determined by:
the change
in participation rates above the age of 55Slide35
Market adjustments
Change in the labour force
Net
in-mobility:
recruiting required by the construction industry from other industries, other trades or occupations outside construction and/or outside other provinces or countries to meet labour requirements
Determined by:
residual labour requirements
>0 implies recruiting outside
<0 implies losses to other industries/regionsSlide36
Market adjustments
Change in construction labour force in SaskatchewanSlide37
Rankings and mobility
Rankings on a scale of 1 (weak) through 5 (strong) summarize the market
conditions.
Regional rankings are a weighted average of four measures
(see next
slide
).
Differences in market rankings signal the potential for
mobility.Slide38
Rankings and mobility
Measures:
Estimated unemployment rate relative to natural
unemployment
rate
Employment growth
Net in-mobility as a percentage of the labour force
Industry
surveySlide39
Rankings and mobility
Annual weighting of the
criteria:
S
urveys are only
applied for one
year.
The weight
attached to replacement demand rises in more distant forecast
periods.
Comments on tables note the potential impacts of
mobility.Slide40
Rankings and mobility
1
Qualified workers are available in
local
markets.
Excess
supply is apparent. Workers may move to other markets.
2
Qualified workers are available in local
markets
.
3
Qualified workers in the local market may be
limited
by
short-term
increases in demand.
Established
patterns of recruiting are sufficient.
4
Qualified workers are generally not available in
local markets
. Recruiting may extend beyond traditional sources and practices
.
5
Qualified workers are not available in local markets. Competition is intense. Slide41
Rankings and mobility
Labour
requirements
(Demand
)
Labour
market
rankings
1
2
3
4
5
Significant excess of supply over demand
Excess of supply over demand
Moderate supply pressures
Significant supply pressures
Supply constraints
Available workforce
(Supply)Slide42
Rankings and mobility
Mobility
Differences in market rankings indicate the potential for mobility in the
model.
Dimensions to mobility:
across industries
Across provincesSlide43
Rankings and mobility
Adjacent
markets for
heavy equipment operators
in
Saskatchewan in
construction
Heavy equipment operators,
Saskatchewan
- Other industries
Heavy equipment operators, Alberta
- Construction
Heavy equipment operators,
Saskatchewan
- Construction
Heavy equipment operators, Manitoba
- Construction
Heavy equipment operators,
Manitoba
- Other
industriesSlide44
Rankings and mobility
Mobility across adjacent labour markets
A market
with unemployment below the natural rate will attract workers from other
markets.
1 2 3 4 5
Natural
u
nemployment
r
ateSlide45
Conclusion
Remember, the BuildForce Canada
LMI system:
includes
the model, reports, PowerPoint
presentations, Construction Forecasts website
with detailed
investment
and labour market data (
www.constructionforecasts.ca
)
depends
on industry input to refine reliability and market assessments
is
a tool that the industry can use for assessing labour
market risks
includes the Construction
Map App website, which tracks the location and schedule of selected major resource construction projects across Canada (
www.constructionmapapp.ca
)Slide46
BuildForce Canada
Tel: 613-569-5552
info@buildforce.ca
www.buildforce.ca
For further information, contact:
January 2012