Calgary is having a massive boom right now. Housing prices and the cost of living here have absolutely skyrocketed in the last year (up approximately $100,000 for the average house from last year). There are jobs being advertised everywhere - it seems like most companies can’t find enough warm bodies, let alone skilled workers. We tried to go to a Burger King on Saturday, and it was closed due to being short-staffed.
I was just checking some job ads, and the salaries being offered haven’t budged for years now. I don’t understand what is going on here. There seems to be some kind of massive disconnect - in a competitive market, if demand drives prices, why aren’t salaries skyrocketing with the boom here? What piece of the puzzle am I missing here?
Part of the reason may be that the jobs are simply in industries that are price-sensitive. For example, if Burger King won’t or can’t increase their prices, and their profit margin is low enough that they can’t afford higher-priced labor, then the alternative to finding cheap labor isn’t to increase prices, but to close your doors.
Part of it is also the belief that the crisis may be transitory. It’s not easy to lower wages once you hire someone at a bigger salary, so if you think wages will stabilize at a lower price in the future, you might just choose to wait it out.
We’re seeing the same thing in Edmonton. There are help wanted signs everywhere. Hell, I saw a van driving around the other day with giant billboards attached to its side asking for laborers to join some framing company - construction being one industry where they can increase wages and pass the cost along, which is one of the factors pushing up the cost of real estate.
What I’ve really noticed lately is a real deterioration in customer service and quality at fast food places. They’re short-staffed, and the staff they have isn’t as dedicated, because they know they can find other jobs anywhere. The fast food places have inreased their wages somewhat, though. I saw a sign at one the other day offering over $9.00/hr for cashiers.
And everyone’s complaining about the lack of supply of construction workers, and the generally poor quality of construction these days. Too many untrained people, and too much work. They are doing rush jobs, and they aren’t trying to protect a reputation as much because there’s more work than everyone can handle. So quality is suffering.
It’s very much the same in Calgary. My husband works in the construction field, and they simply can’t find enough warm bodies to make their deadlines - skilled workers are almost out of the question.
You make good points about employers trying to wait it out. Employers are still very willing to not replace staff who leave, too, with the expectation that the remaining employees will just take up the slack, which most of us do because so many of us got burned so badly by the depression of the 80’s and 90’s.
My husband and I think it is (or will shortly become) an employee’s market in Calgary. Do you see that happening, Sam?
Hell, I’m a registered liberal eastern bastard and I’m starting to think about looking for work in Alberta. I’m not sure though if there would be much work for me as I do physics stuff related to fibre optics. My father who lives in Calgary says he hasn’t seen much call for science types unlesss it is related to oil and gas.
I don’t think that’s entirely accurate; between Edmonton and Calgary, I think there is more scientific/technological stuff going on here than we realize. We’re heard a lot of noise from politicians that they weren’t going to let the same thing happen again in Alberta that happened when the last boom collapsed and all of Alberta’s economy was being driven by oil and gas.
Perhaps it would help if you specified what type of jobs/industry you are referring to? Obviously, the industries where growth is fastest, energy, will become an employee’s market more quickly, and other industries will rise with the tide later.
Balduran, fibre optics are definitely in demand in the oil industry, e.g. <a href=http://www.spie.org/web/oer/september/sep00/multiplexfoa.html>Fiber Optic Hydrophones</a>. There are plenty of us liberals here and the air is cleaner. And if it doesn’t work out, you can always try framing houses…
The biggest threat to Alberta’s future now is a lack of infrastructure. The influx of workers and heavy development is straining infrastructure all over the place. The highway to Ft. Mac is a disaster. In the two big cities roads, sewers, and other infrastructure bits are getting pretty stressed.
It’s actually a pretty risky time in some ways. We need massive capital investment in the province, but if oil prices collapse again (and they might - 5 year futures, last I looked, were only $22/bbl), we could get stuck with a huge bill we can’t pay for.
As for labor shortages, they’re across many industries. Nurses, teachers, laborers, service people… Our IT industry has taken off again in a big way, and it’s getting hard to find programmers again (a couple of years ago there were plenty).
At some point, the shortages have to translate into higher wages - especially since the cost of living in Calgary and Edmonton is skyrocketing. Five years ago, you could get a nice starter home in Edmonton for $125,000. Now you’re looking at over $200,000 for the same house. Our house has gone up in value about 60% in the past five years.
It’ll never be like Vancouver or San Francisco in terms of real estate prices, because we have the space to grow and those cities don’t. So prices may start to flatten out at some point in the relatively near future, but I’d hate to be just starting in the real estate market today. Anyway, when real estate climbs like that, it takes more money to attract labor because they need more to live. So at some point, I would expect to see some pretty good salary increases in the most in-demand industries.
And it goes without saying that if you work construction - especially industrial construction - you’ve got it made now. My brother is a mechanical insulator. Five years ago he was clawing for jobs. Now people bid for his work, and he’s got work lined up to last him more than ten years on contract right now. It’s crazy.
You aren’t kidding. Calgary has never been very forward-thinking in the planning department (from what I can see, anyway), and we’re paying for that now.
Hello Heritage Fund.
I was looking at houses online in Edmonton last weekend, and it looks like they are still way behind Calgary. Would you say this is accurate?
I haven’t decided yet if that’s good or bad. Doesn’t there come a point when a city is just physically too big?
The self-employment that I’m working on starting is somewhat construction-related - doing landscape designing. I’m hoping this boom will be good for me, too.
I seem to remember that five-year futures were in the $55 range, at least according to the people at The Oil Drum.
:: searches ::
Here we are: graph from this discussion. More than $50.
Absolutely. Calgary (and to a lesser extent, Edmonton) are inherently unsustainable at current sizes and densities. It costs entirely too much to build your roads, sewers, schools, etc. to cover these areas at a density of 7 units per acre (about what both cities are building in the burbs). I don’t know about Edmonton city council, but Calgary is at least addressing the issue finally, and has a goal of moving some x thousand more people into the downtown core in the next 5-10 years. I don’t want or think we particularly need Calgary to be as dense as Manhattan, but the sprawl of the city is ridiculous. It’s over 30 miles north to south right now, for just under 1 million people. The downtown core of “skyscrapers” is basically 15 x 10 blocks - which is incredibly compact.
Heh, I remember thinking to myself last August, as I drove through endless mindless suburb, thinking something along the lines of “only one million people, are they sure?”. Bloody hell, when I think about it, one Calgary equals eight Ipswiches. And that’s nothing to be proud of
Actually, I guess it’s not so much about size as efficiency. [ul][]How efficiently does the city provide its transport and services? []How much does it cost to add the infrastructure for another family, and connect them to food, water, work, school, etc? [*]Is there some infrastructure project that you can build that may be expensive, but can then be ‘amortised’ over a large number of residents, and is that cheaper in the long run than adding small extensions piecemeal? [/ul]Definitely, long-term planning can be very useful. But you folks in Alberta are lucky: you have a lot more resources on hand to fund such things than most people, so you can afford large lump-sum investments.
I was talking to a random person I met while waiting for the train, and he said that janitors were being offered 80,000 a year in Fort McMurray.
I don’t know whether that’s true–that’s quite a bit more than I make as a tech writer here in Toronto–but if it is, I suspect that those high wages are extremely local to the oilsands development, and are tied to a lot of hard work. GM used to pay extremely well in Oshawa, but you had to work hard for it on the line. (They still do, but it’s increasingly-hard to get one of those jobs.)
The same guy also said that bags of milk (the 4-litre kind, presumably) were going for $8 each in Fort McMurray (as opposed to $5 in Toronto), so that eighty thousand probably doesn’t go as far as it would here.
But this is the first I’d heard that salaries in general weren’t rising in the boom areas.
I promise this is the last hijack, but the endless sprawl is the thing I least like about this place. My life long dream is to one day own a Vespa and ride it to work a la Scrubs, but it looks like I will have to move somewhere else warmer and more compact to realize it.
Like many young graduates in Saskatchewan, I’m probably moving to Alberta (likely Calgary) in two or three years. I’m studying web design, but I don’t want to freelance because I’m so young (I’ll be 20 at grad) and I’m not a keen businesswoman. But if I want to join a company, I need to go to Alberta. Sask just doesn’t have web design jobs, most companies outsource their web design to Calgary, Toronto or Ottawa.
The only thing in Sask is if you’re into the trades, forestry, mining and medical fields. It makes me angry that everyone around here panders to the trades. Our Weyerhauser mill is closing, so for the last 6 months places like Fort McMurray have been crawling all over themselves to pick up tradespeople from here - the newspaper is 80 trades/20 everything else in the jobs section.
That wouldn’t surprise me. I saw an ad for welders for the oil patch for $100/hr last summer. Did they also mention that there is virtually no housing available in Fort Mac, at any price?
See, the whole thing about Calgary salaries remaining so low is what prompted this thread in the first place. It doesn’t make sense to me, either, that the salaries are remaining as low as they are in Calgary with everything else that is going on.
Sunspace, it is my opinion (and I’m no city planner) that Calgary is not at all efficient about services, transit, etc. They’ve never had to be; Calgary’s astonishing growth was never planned or expected, apparently. Things like efficient highways within the city are just now starting to become a priority, something like 10 years after they were required. The City of Calgary builds a new road, and it’s 100% over capacity the day it opens. In all fairness, though, the current administration has inherited most of its problems from previous administrations that didn’t seem to place any importance at all on future planning.
kushiel, I’m from Saskatchewan, too, as are my two sisters and brother-in-law who also live here in Calgary. We came because we wanted to work, like most other people who end up here. We came here in the 80’s and 90’s when you couldn’t buy a job in Sask - I thought things were better there now.
Sunspace, I’ll address this as a former Torontonian who now lives in Calgary (and, just so nobody thinks I’m one of those eastern bastards who should freeze in the dark, I was living in Calgary in the 1960s, before I moved to Toronto). What you mention–all three aspects–are, by Toronto standards, pretty poor. Sorry, Calgarians, but compared like that, they are.
Roads are not bad, physically. About what you’d find in Toronto. But when there’s a construction project going on, don’t expect them to finish any time soon. During construction season–ahem, excuse me, summer–don’t expect to get anywhere soon, if your route takes you through a construction project. Road construction seems to take longer than it does in Toronto; I don’t know why.
As featherlou points out, new roads are operating at capacity as soon as they are built. True enough. But it shouldn’t be a surprise to the city–if, for example, the city has issued building permits for developments, it should also realize that nearby roads are going to have to be improved. Unfortunately, it often doesn’t.
And what is this “rail” you speak of? Seriously, Calgary does have a LRT, not a subway, but it has a lot of room for improvement. Firstly, it doesn’t run that often, at least not from this former Torontonian’s point of view. Sorry, folks, but a train every fifteen minutes outside of rush hour doesn’t cut it. You want to get people out of their cars, run trains more frequently. I don’t think, for example, I ever waited more than five minutes for a Toronto subway train, even on a Sunday.
Running buses more frequently would be a bonus too. Heck, running buses period would help. Sunspace, imagine if Eglinton had no buses running on it. An important east-west artery without buses. Got the idea? Now, let’s put it in Calgary and call it Country Hills Boulevard. No buses, and as a result, far too many cars. And because there are so many cars, we need even more signal lights–which only back up traffic further.
Rail to other cities is non-existent. Thank you Brian Mulroney, for cancelling passenger rail service to Calgary in 1990. :rolleyes: To get anywhere from here, you have to drive, or take a bus. I will admit that bus service from Calgary to Edmonton is as nice as bus service can be, but it is still subject to the road conditions (and construction) on Highway 2.
Don’t get me wrong. I like Calgary; it’s a great city with great people. But there is a lot of room for improvement, and Calgary’s deficiencies will become more apparent, and their correction more important, as this boom progresses. I don’t think, Sunspace, it’s a matter of catch-up so much as a matter of dithering. “Hmmm…this seems to be a problem; let’s talk about it for the next year. And then, if we decide to go ahead, we have two years to do it in. No rush.” Well, with this oncoming boom, there is a rush. And Calgary will have to deal with it somehow.
On another note, Sunspace, I’ll be in Toronto in May. Any chance we might meet up?
I can’t disagree with anything you’ve posted, Spoons. We were on Country Hills Blvd last weekend, an it doesn’t seem to matter when, it’s backed up. I was living in Sandstone when Beddington Trail was built, and the city didn’t seem to realize that there was anybody living north of McKnight who might want to use the new artery. And the closure at the north end of Centre Street - I can barely think about it, it is so completely illogical. If I came to Calgary and experienced it, I would think the City was playing a massive joke on us. “You see where you and 10,000 other people need to go? Well, you have to go four kilometres out of your way to get back to exactly where you started.” This is all relatively new development. It could have been planned and engineered as a model way to build, instead of looking like a bunch of afterthoughts thrown together.
As for the buses, if you’re not going to and from downtown, you’re pretty much hooped. There is supposed to be a north-south C-train line going in that will parallel Deerfoot, but who knows when that will be built? Sometime about 20 years after it was needed, is my guess.
