Boom. The economic explosion in western Canada’s resource and construction sectors is generating a lot of wealth and jobs.
Oil is booming, minerals are in demand, the service sector is expanding and, after years of depressed commodity prices, there’s a glint of optimism in farmers’ eyes.
But the red-hot economy has also presented an unexpected challenge for prairie agriculture.
With more people finding jobs away from the farm, producers are scrambling to recruit and retain workers who can drive tractors, manage dairy herds and work in hog barns.
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“There’s no question about it, it’s tough,” said Kevin Woods, owner of Westwood Land and Cattle near Moosomin, Sask.
“We’ve got a fair amount of oilfield activity right here … and we’ve also got two or three potash mines not far away.”
“They’re hiring people like crazy at those mines and they’re offering good paying jobs with lots of benefits,” he added.
“So it’s a challenge, there’s no question.”
Compared with many farms in the area, Woods’s operation is big.
It consists of a 2,000 head cow-calf operation, a 10,000 head feedlot and an 8,000 acre land base.
Earlier this year, in preparation for the spring seeding season, Woods placed a help wanted ad, seeking a worker to run a 9620 John Deere tractor and a Bourgault 5710 air hoe drill.
The starting wage for the position was $18 to $22 an hour, depending on experience.
“Those young guys that go to work in the mines or in the oilpatch, they get used to making big money and it’s really tough for them to come back … to agriculture,” Woods said.
“If you come back from a $25 or $35 an hour job in the mines and take a $15 to $20 an hour job (on the farm) … you’re giving up a fair amount of pay for a different way of life ….
“They’ve got to really enjoy what they do because if it’s all about the money … then working in agriculture is probably not the job for them.”
Not long ago, farmers like Woods were offering lower wages and having less difficulty finding qualified farm help.
But times have changed.
A booming resource industry, particularly in the oil and gas, construction and mining sectors, is fuelling growth in all parts of the economy.
Across the West, restaurants, retailers, construction companies and farmers are all competing for capable help.
Danielle Smith, Alberta director for the Canadian Federation of Independent Business (CFIB), said competition for employees has intensified, forcing farmers and other small employers to come up with creative ways to recruit and retain workers.
“It’s not always easy for small employers to compete on wages and benefits alone, especially when you’re competing against an extremely wealthy employer like the oilpatch.”
Smith said a recent survey of CFIB members showed farmers and other small employers are going to great lengths to attract employees.
Some are offering a shorter work week, flexible hours, performance incentives and retention bonuses, Smith said. Others are offering referral bonuses, where staff members are rewarded for recruiting other workers, and reliability bonuses for showing up to work on time.
“I think small employers have had to be more innovative in finding ways to keep the workplace more flexible,” Smith said.
“But in this type of labour market … it’s just getting harder and harder.”
Labour statistics provide compelling evidence of high demand for qualified workers in the West.
According to Statistics Canada, the number of people working in Alberta hit a new record in June 2008, with nearly 2.02 million people holding jobs, either full or part time.
In Saskatchewan, the number of people working has risen by 11,200 in the last year and nearly 10,000 positions remain vacant.
Alberta, Saskatchewan and Manitoba had the first-, second- and third-lowest unemployment rates respectively in the country in June.
Seasonally adjusted unemployment stood at 3.3 percent in Alberta, four percent in Saskatchewan and 4.1 percent in Manitoba, compared to a national rate of 6.2 percent.
Saskatchewan’s numbers were particularly noteworthy.
From May 2007 to May 2008, the number of people receiving regular unemployment benefits in Saskatchewan fell by 27.7 percent while the province’s population rose to an estimated 1.01 million people.
Since late 2006, Saskatchewan has grown faster than any other province and Statistics Canada says much of the growth was the result of more foreign workers and increased interprovincial migration, mainly people returning to Saskatchewan from Alberta and other provinces.
Terry White, a spokesperson for the Saskatchewan ministry of advanced education, employment and labour, said the labour market in Saskatchewan is the tightest many employers have ever faced.
“I would say that’s definitely, definitely the case … certainly in the last few decades.”
White said the province is expanding training programs, spending more on immigration services and recruiting workers aggressively from other Canadian provinces.
Demand for skilled tradespeople, especially transportation workers and equipment operators, is particularly high.
“The most obvious (reason for the tight labour market) … is the high price of oil, and Saskatchewan has lots of it,” White said.
“But beyond that, just about every natural resource that Saskatchewan has is suddenly worth a lot.”
Uranium, potash and grain prices are record high.
“So because of our raw commodities having gone up so much in value, there is development in every area.”
Although Woods is happy to see the prairie economy booming, he and other farmers are feeling the pinch.
In Woods’s own backyard, oilfield activity is booming and a planned $1.8 billion expansion at the Potash Corp. of Saskatchewan (PCS) mine near Rocanville, Sask., just down the highway, is expected to create the equivalent of 500 construction jobs beginning next year.
When the expansion is complete, PCS will hire 200 full-time employees to work in the mine.
“Where are they (PCS) going to come up with 500 men in our economy?” said Woods.
“They’re going to have to come from somewhere else because there’s not 500 people around here to hire unless there’s going to be nobody left doing anything else but mining.”
Jeff Kuntz, who farms at nearby Esterhazy, Sask., has already lost one employee to the mining industry and filling the position hasn’t been easy.
To fill the vacancy temporarily, he has hired elderly retired farmers on a part-time basis, local high school students and a recent high school graduate with no farm or equipment experience.
Help wanted ads have generated calls from a variety of underqualified candidates, including a drug user who was fired from his last job in Estevan, Sask., and another applicant who claimed to be working in northwestern Alberta.
Eager to meet the potential new employee from Alberta, Kuntz covered the applicant’s travel costs to Yorkton, Sask., picked up his hotel bill and paid for a return bus fare to Calgary, where the potential employee said he was planning to visit his elderly grandmother.
The total cost of the interview was around $600.
A few weeks later, after contacting the candidate’s parents in Alberta, Kuntz learned that the man he was considering hiring had no grandmother in Calgary, was evading child support payments and hadn’t held a driver’s licence for the past 15 years.
“Those are the kinds of people that are left to work,” Kuntz said.
“I finally got to the point where I said to myself, ‘if it takes a few extra days to get the job done, so be it. I’ll do it myself’. But I’m getting frustrated.
“I’m only 38 years old and I hope I have a long future in this farming operation, but when one guy has to do 95 percent of the work, it’s tough.”
