Economic and Social Reports, October 2024

There are five new articles available in today's release of Economic and Social Reports.

Fewer women work in management roles compared with men in Canada

The inclusion of women in leadership roles is an important aspect of workforce diversity, helping to promote a more innovative and resilient corporate culture. The study "Women middle and senior managers" looks at the representation of women and the gender wage gap among middle and senior managers over the 2001-to-2021 period. The study found that, relative to women's share among non-managers (47.2%), women were underrepresented in management roles in Canada, holding 42.7% of middle management positions and 30.8% of senior management positions in 2021. Nonetheless, although women still earn less than their men counterparts, the gender wage gap has narrowed significantly: down from 19.3% in 2001 to 8.7% in 2021 for middle managers and from 20.0% to 9.0% over the same period for senior managers.

Women's representation in management roles in 2021 varied by sector, being more prevalent in health care and social assistance and in educational services and significantly lower in construction and in mining, quarrying, and oil and gas extraction.

Relative to their representation among non-managers, immigrants and racialized individuals were also underrepresented in management roles. Immigrant women and racialized women face additional barriers in this context. Indigenous women comprised 3.4% of middle managers, while their representation among senior managers was 4.5%, aligning closely with their share among non-managers, at 4.1%.

This study highlights the necessity of implementing diversity and inclusion policies, which help prepare women for higher leadership positions.

International students and temporary foreign workers have less access to affordable housing compared with Canadian-born renters

As concerns over housing affordability in Canada grow, questions have been raised about the experiences of non-permanent residents in the rental market. The study "Do international students and temporary foreign workers pay more than Canadian-born individuals in the rental market?" found that, in 2021, international students paid 10% more in monthly rent per unit compared with Canadian-born individuals in the same urban area, while temporary foreign workers (TFWs) paid 21% more. However, the rental cost difference for TFWs decreased to 5% when comparing renters with similar household characteristics (e.g., household size) living in the same neighbourhood and in similar dwellings.

The higher rental costs for international students compared with those for Canadian-born individuals can be attributed to differences in dwelling characteristics, as international students are less likely to live in subsidized housing and more likely to live in condominiums and newer buildings. These findings suggest that the higher rental costs for international students and TFWs are mostly due to their limited access to more affordable housing options, rather than having to pay more for equivalent rental units than Canadian-born renters.

A look at recent developments in the Canadian economy

The article "Recent developments in the Canadian economy: Fall 2024" provides an integrated summary of recent changes in output, consumer prices, employment and household finances. It highlights changes in economic data during the first half of 2024 and the summer months. The article also examines how economic conditions have changed as borrowing costs continue to evolve.

Economic activity rose at a moderate pace during the first half of 2024, as increases in household spending, non-residential business investment and government consumption expenditures supported growth. Increases in public sector activity buoyed economy-wide output in the first half of the year, while higher oil and gas extraction contributed to a rebound in goods production toward the middle of the year. Employment growth in the private sector slowed as the unemployment rate rose.

Headline inflation fell and remained below 3% throughout the first half of 2024, as price growth for many consumer products eased. Consumer inflation slowed in the summer months, decelerating to 2%, the midpoint of the Bank of Canada's target range in August. The cumulative price increases since inflationary pressures began to ramp up have created ongoing affordability challenges for many families. From January 2021 to August 2024, the all-items Consumer Price Index rose by 17.1%, equalling the cumulative increase in the headline rate that occurred during the 10 years prior to 2021. Household income growth helped offset rising debt service obligations in the first half of 2024, while the ratio of household credit-market debt to disposable income trended lower, as mortgage borrowing increased at a moderate pace.

Most temporary foreign workers intend to stay in the province where they last worked when transitioning to permanent residency

Among foreign workers who received permanent residency during the period from 2011 to 2015, 97% intended to settle in the province where they last worked, and 82% remained in the same province five years after immigration. The article "Foreign workers in the labour force: Provincial retention after transition to permanent residency among work permit holders for work purposes" found that former work permit holders were more likely to stay in their intended provinces than economic immigrants without prior Canadian work experience. The retention rates five years after immigration were 78% for former work permit holders and 68% for economic immigrants without prior Canadian work experience.

Additionally, retention rates differed across provinces and territories. One year after immigration, the retention rates for the 2011-to-2015 landing cohort were lower in the Atlantic provinces and the three territories (81% or lower) compared with other provinces (86% or higher). Five years after immigration, about half of the 2011-to-2015 landing cohort who worked in Newfoundland and Labrador (46%) and Prince Edward Island (50%) had stayed in the same province, compared with 80% or more for those who worked in the four largest provinces. These provincial differences closely mirror those observed among all immigrants, suggesting that smaller provinces face similar challenges in retaining both former temporary foreign workers and other immigrants.

Revenue of the food services and drinking places subsector fell drastically at the beginning of the COVID-19 pandemic when restrictions were implemented and working from home rose sharply

The COVID-19 pandemic triggered massive economic and societal changes, like working from home and the loss of revenue in food services and drinking places. From February to April 2020, revenue of the food services and drinking places subsector fell by $3.2 billion. The study "The net impact of telework on restaurant revenues in Canada" found that the increase in working from home accounted for about one-third of the drop in the sector's revenues during that period.

From March 2020 to July 2022, an increase of 1 percentage point in the monthly incidence of working from home was associated with a reduction of less than 1 percentage point in the monthly growth rate of receipts in food services and drinking places in a given province during that period.

With working from home being important to many Canadian workers, this study can help guide future research into the extent to which the increase in working from home may have shifted demand for food services and drinking places to restaurants near the homes of workers rather than near their workplace.