A closer look at Canada’s talent market.

Canada has more available talent than it did during the tightest years of the labour market.

In August, 1.5 Million Canadians were unemployed and the unemployment rate sat at 6.4%. Nearly ¼ of those unemployed 24% have been looking for a job for 27 weeks or more. For employers, that should translate into an easier hiring market. And in many cases, it does. But another set of numbers tells a more complicated story.

Statistics Canada’s latest business data shows that 25.2% of Canadian businesses still expect recruiting skilled employees (employees with the skills businesses need) to be an obstacle over the next 3 months, making this the second most commonly anticipated business obstacle after inflation. In manufacturing, that figure jumps to 38.2%. So while the labour market has clearly loosened, access to skilled talent hasn’t improved equally across the market.

The experience employers are asking for is changing. One statistic in particular stands out.

In the fourth quarter of 2025, 12.9% of Canadian job vacancies required five or more years of experience, the highest proportion Statistics Canada has recorded. Just over three years earlier, in the third quarter of 2022, only 8.1% of vacancies required that level of experience. That’s a significant change in a relatively short period. Statistics Canada doesn’t tell us why employers are asking for more experience, and I don’t think we should assume there is only one explanation.

Roles may genuinely be becoming more complex. Employers may be placing greater premium on proven experience in an uncertain economic environment. Organizations may have less capacity to develop someone into a position. Or greater candidate availability may simply be allowing employers to be more selective. It could be a combination of factors.

But it raises an interesting question: has Canada’s talent shortage disappeared, or has it simply become more concentrated?

A larger candidate market can still contain small talent pools. Earlier this year, 35.1% of Canadian businesses reported having difficulty finding candidates with the skills they needed during the previous 12 months. It’s important not to misinterpret that number. For 45.9% of those businesses, the primary problem was straightforward: too few applicants or not enough people interested in the work. So there are still areas where employers simply aren’t attracting enough people.

But that’s happening alongside a much broader increase in candidate availability. What we’re left with isn’t one Canadian hiring market. There are occupations with substantial candidates supply and others where employers continue to struggle. There are positions where experience is relatively transferable and others where the combination of technical knowledge, industry exposure, leadership scope, or other requirements creates a much smaller pool.

That’s why the current market can feel contradictory. An organization can receive hundreds of applications for one position and struggle to produce a shortlist for another. Both can be accurate reflections of the same labour market.

Perhaps “employer’s market” is the wrong conversation. We tend to describe the labour markets as favouring either employers or candidates. The current data makes that distinction less useful. Canada’s labour market has become more favourable to employers in some respects. There are more people looking for work, and long-term unemployment remains well above its pre-pandemic average.

At the same time, one-quarter of businesses still anticipate difficulty recruiting skilled employees, while the proportion of vacancies requiring significant experience has reached a record high. Those aren’t conflicting signals. They suggest that talent scarcity is becoming more specific. And that may be the more useful way to look at hiring heading into the fall.

The question isn’t simply whether more candidates are available. It’s which candidates have become more available and whether they’re the ones organizations are trying to hire.

sources: Statistics Canada - Labour Force Survey, August 2026. Statistics Canada - Canadian Survey on Business Conditions, Third Quarter 2026. Statistics Canada - Analysis on Employee Skills Gaps, First Quarter 2026. Statistics Canada - Job Vacancies, Fourth Quarter 2025.