Labour Market Forecasting at HRSDC

Transcription

1 PWFC Pre-Symposium Workshop on Data Development and Modelling Labour Market Forecasting at HRSDC Gilles Bérubé Policy Research Directorate, HRSDC December 12, 2007

2 Outline of presentation What do we forecast? Why? When? The forecasting models Data used in forecasting models A sample of projection results Challenges: Data Challenges: Modelling 2

3 What do we forecast? Why? When? 3

4 What do we forecast? Trends over next ten years in the level, composition and sources of labour demand and labour supply, by broad skill level and by occupation Demand - supply imbalances by broad skill level and occupation 4

5 Why do we do this? To help inform: HRSDC policy development by identifying potential future labour market and skills issues Young Canadian students (and their parents) facing educational decisions, via the use of the forecasts in labour market information products (Job Futures) Canadian employers interested in the labour market conditions they have to hire from 5

6 When do we do this? Full labour market projections every two years Partial updates every year Results shared every year with provincial and regional partners Results published every two years (Looking Ahead Report) 6

7 The forecasting models 7

8 What models do we use? Forecasting models known as the Canadian Occupational Projection System (COPS) Models for forecasting labour demand Expansion demand (from economic growth) Replacement demand (mostly retirements) Models for forecasting labour supply School leavers, by level of education, field of study and occupation Recent immigrants, by occupation 8

9 The COPS Models Structure Aggregate Macroeconomic and Labour Market Indicators Demographics Employment by Industry Labour Force Expansion Demand Retirements School Leavers Recent Immigrants Future Labour Market Imbalances by Broad Skill Level Change in employment versus change in labour force by broad skill level Future Labour Market Imbalances by Occupation Job openings versus new job seekers by occupation 9

10 Macroeconomic and industrial outlook Aggregate Macroeconomic and Labour Market Projection Projections of major economic (e.g. GDP components) and labour market variables developed in collaboration with the Conference Board of Canada using their national Medium-Term Forecasting Model (MTFM) Expansion Demand by Industry Projections of production and employment growth by industry (33 NAICS industry groupings) developed in collaboration with the Conference Board of Canada using their national Medium-Term Forecasting Model as well as satellite models for the health and education sectors 10

11 Expansion and replacement demand Expansion Demand by Occupation Projections of new jobs openings resulting from increased economic activity (140 occupations across 33 industries) Replacement Demand by Occupation Projections of total retirements from the labour force and retirements by occupation (140 occupations) 11

12 Population and labour force Demographics Demographic projections developed using the MEDS Model initially built by Professors Denton and Spencer from McMaster University Births, deaths and migration are forecasted by single years of age and gender up to 2051 using in-house assumptions Labour Force Labour force projections developed using the demographic projection and a model for the labour force participation rate (by gender, 12 age groups, 7 levels of education and 5 broad skill levels) 12

13 New labour supply School Leavers by Occupation Projections of new job seekers coming from the different levels of education and different fields of study. In particular, PSE students from 281 fields of study are distributed across140 occupations when entering the labour market. Recent Immigrants by Occupation Projections of new job seekers among recent immigrants of working age, across 140 occupations. 13

14 Labour market imbalances Future Labour Market Imbalances by Broad Skill Level Future imbalances by broad skill level are assessed by comparing projected employment growth (expansion demand) to labour force growth by skill level. Future Labour Market Imbalances by Occupation Future imbalances by occupation are assessed by comparing the number of job openings (from expansion demand and retirements) to the number of new job seekers (from school leavers and immigrants). 14

15 Data used in forecasting models 15

16 Data sets used in the models (1) Data sources Period covered Use in labour market projections Labour Force Survey (LFS) Monthly National Graduates Survey (NGS) Occasional 1976 to 2006 ( for occupational and industrial data) (Class of 2000) (Class of 1995) - Primary data to project employment growth by occupation (expansion demand) - Occupational distribution of non-pse graduates (high school and less than high school) and discontinuants (from PSE) - Primary source of data on how graduates in different PSE fields of study map into employment in specific occupations Post-secondary Student Information System (PSIS) Annual (?) - Primary & High School: Trade & Voc.: Colleges: University: PSIS data used to project new school enrolments and the new supply entering the labour market from the different education levels 16

17 Data sets used in the models (2) Surveys Period covered Use in labour market projections Youth in Transition Survey (YITS) Biannual Census 5-Year Annual Demographic Statistics Annual Longitudinal Administrative Data (LAD) Annual 2000 to to to Used in forecasting the proportion of high school graduates that go on to pursue PSE - Provide the labour force participation rate of immigrants - Allocation of new immigrants by occupation - Demographic projections - Estimation of the total number of retirements at the national level 17

18 A sample of projection results 18

19 Slower growth in labour force and potential employment Aggregate Labour Market Outlook 3.5 Employment growth (%, left scale) 3.0 Labour force growth (%, left scale) Unemployment rate (right scale)

20 Over 2 of every 3 job openings will come from retirements Job Openings: Retirements and Expansion Demand 700, ,000 Expansion Demand Retirement 500, , , , ,

21 School leavers remain by far the main source of new labour supply in the Canadian economy New Labour Market Entrants: School Leavers and Immigration 700, ,000 Immigration School Leavers 500, , , , ,

22 Future growth in labour supply projected to be in line with growth in demand among broad skill levels Projected Increase in Employment and Labour Force, By Broad Skill Level Annnual Employment Increase (% 2,0 1,5 1,0 0,5 0,0 Skill Level B: Usually require college or apprenticeship Skill Level D: Usually require on-the-job training 0,0 0,5 1,0 1,5 2,0 Annual Labour Force Increase (%) Skill Level A: Usually require university Management Skill Level C: Usually require secondary school Source: HRSDC, Policy Research Directorate, 2006 Reference Scenario. 22

23 Many occupations facing excess demand coexisting with others facing excess supply 14 Projected Job Openings and New Job Seekers by 3-digit occupations Average annual number of job openings as %of 2005 employment Demand growth greater than supply Supply growth greater than demand Average annual number of new job seekers as % of 2005 employment Source: HRSDC, Strategic Policy Research Directorate, 2006 Reference Scenario. Numbers shown beside the dots correspond to occupations codes used in the National Occupation Classification. 23

24 Occupations with excess demand over next 10 years Occupational group Management Business, finance, administration Natural and applied sciences Health Trades, transport and equipment operators and related occupations Occupations specific to primary industry Occupations specific to processing, manufacturing and utilities Occupations expected to face excess demand conditions Senior management, human resources managers, managers in health and public administration and residential home builders and renovators Human resources and business services professionals Civil engineers Physicians, therapy and assessment professionals, head nurses and supervisors, nursing assistants and other technical occupations in health care Contractors and supervisors, trades and related workers Supervisors and workers in oil and gas drilling/service Supervisors, processing occupations such as in petroleum / gas 24

25 Severe shortages in several occupations Occupation Non-student employment 2005 (000s) Excess demand as % of 2005 employment Excess demand as % of new supply Human Resources & Business Service Professionals % 58% Physicians / Dentists / Veterinarians % 51% Optometrists / Chiropractors / Other Health Professionals % 124% Nurse Supervisors and Registered Nurses % 70% Other Tech. Occ's in Health (Except Dental) % 80% Assisting Occ's in Health Services % 63% Underground Miners, Oil and Gas Drillers and Related Workers % 172% 25

26 Challenges: Data 26

27 Data gaps place limitations on projections The possibility of undertaking labour demand projections for more detailed occupations (e.g. at the 4-digit level) is limited by small sample sizes Considerable lags in the release of educational administrative data (e.g. enrolment and graduation): risk of missing key recent developments need to forecast the past before projecting the future (e.g. college enrolment by program) Not possible to develop standard provincial-level projections of new labour supply emerging from the school system due to lack of reliable and comparable data by province 27

28 Data gaps could become more severe -The continuation of the PSIS, the primary source of data on enrolments and graduations throughout the school system, is not guaranteed -The continuation of the NGS, the primary source of information on the occupational distribution of graduates, is not guaranteed 28

29 Challenges: Modelling 29

30 Modelling labour market entrants and leavers Labour market entrants: Revisit the allocation of new graduates by occupation Labour market leavers: Improve the retirement model at the occupational level 30

31 Modelling occupational mobility Model labour supply mobility: - Into management positions - Between occupations within a same skill level - Between occupations of different skill levels 31

32 For more information: Gilles Bérubé Policy Research Directorate