HPAC Magazine

StatsCan Report: regional income disparities for newly certified journeypersons

New study finds that starting incomes of newly-certified journeypersons in Alberta, Saskatchewan, and Newfoundland & Labrador have fallen since 2014, while the incomes in Central Canada have risen.

March 10, 2021   By HPAC Magazine

Using data collected from 2008 to 2018, Statistics Canada has published information noting how the employment income of journeypersons varies widely across Canada, with those in the North and Western Canada making more on average in 2018 than those in Central and Eastern Canada.

The dollar figures used are an aggregate for all trades, which includes 25 Red Seal trades with the largest number of certifications from 2008 to 2018 and five non-Red Seal trades. So be aware this does not reflect on HVAC and/or plumbing specifically.

The study found that starting employment incomes of newly-certified journeypersons in the provinces of Alberta, Saskatchewan, and Newfoundland & Labrador have fallen since 2014, while the income of journeypersons in Central Canada has risen.

journeypersons

(source: Statistics Canada)

The median employment income of the 54,475 journeypersons who obtained certificates in the trades in 2018 was $52,250.

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Although these data pre-date COVID-19, they establish baselines at a time of rising concerns around starting an apprenticeship or graduating into an uncertain economic environment during the pandemic.

In 2018, prior to the pandemic, newly-certified journeypersons working in the territories ($85,760), Alberta ($63,920), Saskatchewan ($57,500), and British Columbia ($55,020) had the highest median annual employment income, while those in Nova Scotia ($43,970) and Prince Edward Island ($39,040) had the lowest.

Despite leading all other provinces in earnings for journeypersons, Alberta, Saskatchewan and Newfoundland & Labrador, have all faced economic challenges in recent years. After the collapse in crude oil prices in 2014 to the end of 2018, employment numbers in trades, transport and equipment operators and related occupations fell in Alberta (-8.6%), Saskatchewan (-5.2%) and Newfoundland & Labrador (-4.5%).

Over this same period, new certifications in the trades were down by more than a tenth in these provinces, while new registrations in apprenticeship programs fell by nearly half.

The economic challenges in these provinces also led to falling median employment incomes in the first year of certification. For example, journeypersons who were newly certified in Alberta in 2014 had a median annual income of $85,780 in their first year, compared with $63,920 for those who were newly certified in 2018, a one-quarter (-25.5%) decrease in first-year earnings.

Newfoundland and Labrador (-38.4%) and Saskatchewan (-15.1%) also saw declines in first-year earnings for newly-certified journeypersons over this period.

During that same period, in Quebec and Ontario, where housing construction and investments in infrastructure projects led to strong employment growth in the construction industry and in trade-related occupations.

While the median annual earnings at certification remain lower than in Western Canada, first-year earnings rose by more than 7% from 2014 to 2018, to $50,830 in Ontario and $47,540 in Quebec. The study suggests this may be due, at least in part, to more favourable economic conditions and higher rates of unionization in these provinces than out west.

Interprovincial mobility

Using 2018 tax data, a new study also sheds light on the labour market transitions of newly certified journeypersons, the most recent year for which these data are available.

In 2018, one year after certification, 6.8% of journeypersons either lived or worked in a province or territory other than their place of certification.

This was down from the peak of 9.4% in 2014, and marks the lowest point since 2008 (the first year for which data are available).

With economic uncertainties in Alberta and Saskatchewan, the number of newly-certified journeypersons who chose to leave these provinces rose from 2014 to 2018. At the same time, many fewer journeypersons chose to move to these provinces from Ontario, British Columbia, Quebec and the Atlantic region than in 2014, opting to stay in their province of certification instead.

Formal training pays off

Most certificates in the trades are granted to those who complete formal apprenticeship programs. However, nearly one-third of certificates granted each year are to trade qualifiers. These are tradespeople who have worked in a specific trade for an extended period of time, without necessarily having been an apprentice, and who have received certification usually through a skills assessment examination.

The new data shows that while trade qualifiers earn more prior to certification than those in apprenticeship programs, apprentices are quickly able to close this gap and eventually earn more than trade qualifiers by the year of certification.

In 2010, for example, four years prior to certification, the median annual incomes of would-be trade qualifiers was just over a quarter higher (+27.7%) than the median annual income of individuals who eventually certified through an apprenticeship program.

The gap in median income decreased as apprentices neared certification, and by the year of certification, apprentices were making 6.3% more than trade qualifiers.

In 2018, four years after certification, the median employment income of those who completed an apprenticeship program ($63,560) was more than $3,000 higher than the income of trade qualifiers ($60,260).

These results highlight the importance of access to formal in-class and on-the-job training at a time of growing concerns over reduced in-class instruction and fewer employment opportunities. In light of the COVID-19 pandemic, these indicators demonstrate the importance of the health of local labour markets in the early career of newly-certified journeypersons. A challenging economic environment can result in fewer employment opportunities, fewer certificates granted, lower starting wages, and fewer opportunities to find employment in other parts of the country.

 

Challenging labour markets in 2020

A more recent Statistics Canada study found that 2020 secondary and postsecondary graduates could face $25,000 or more in lost earnings over the next five years.

Preliminary 2020 results also suggest that certifications in the trades decreased by almost half (-48.7%) in the first nine months of 2020 compared with the same period in 2019, further representing lost wages for many would-be newly certified journeypersons in Canada.