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Big wages a problem for small businesses in Bonnyville

With the average wage for Albertans steadily climbing over the past few years, one financial organization has stepped forward raising concerns that a continued surge could prove too much to handle for small and mid-sized businesses in the province.

With the average wage for Albertans steadily climbing over the past few years, one financial organization has stepped forward raising concerns that a continued surge could prove too much to handle for small and mid-sized businesses in the province.

According to a press release sent out by ATB Financial, Alberta workers earn the highest incomes in Canada, which is putting pressure on the province's smaller business owners and operators.

ATB's second quarter Business Beat Survey revealed that 67 per cent of those businesses are finding it difficult to find or retain experienced or skilled labourers, while 37 per cent claim they are unable to meet the current salary demands of both potential and current employees.

ATB's executive vice president of Business and Agriculture, Wellington Holbrook said he believed the challenge facing these businesses would only intensify if larger corporations are willing to pay higher wages for both local and fly-in workers.

“Whether they are looking for skilled journeymen, technical computer skills, equipment operators – the challenge is widespread across all industries throughout the province,” Holbrook said. “And once business owners eventually find employees who fit their needs, things like salary expectations make it difficult to hang onto them.”

CEO of the Alberta Chambers of Commerce Ken Kobly claims that labour costs are driven up due to the fact there are more jobs in the province than there are employees – something that hurts smaller businesses.

“We're in the midst of a tight labour market,” Kobly said. He went on to explain a shortage of employees has a significant impact on the province.

Unemployment in Alberta currently sits at 4.3 per cent according to Kobly, who added that “3.9 per cent is considered to be full employment – at that point, everyone who wants a job has one.” He said that although those numbers may look good at first, they actually hinder a lot of businesses throughout Alberta, with “most parts of the province facing labour shortages.”

Kobly said a large part of the problem could be traced to the success of both the oil and construction industries, where people are able to move up the chain faster, resulting in the lower paying jobs being unfulfilled.

That is a sentiment shared by local businesswoman Rhonda Holloway. Holloway is the general manager of Centre Suites Inn in Bonnyville, and she said the wages being offered in the oilpatch make it tough for her to keep employees for a significant period of time.

“The higher wages offered by larger companies and organizations that make lots of money make it incredibly tough for the smaller businesses in town,” Holloway said. “When people move out here, or graduate from school and enter the working world they see the money that some people are making in the oilpatch, or with these larger firms and they automatically assume that's the going rate being paid.”

Holloway said that while she offers a competitive wage at her motel, she finds it difficult to find locals wanting to work for a “lower wage”.

“I've just completed a run of advertising for jobs at the motel and I received three applications from local workers,” she said. “So there is an absolute shortage of local workers out here that are willing and wanting to work for a smaller wage with smaller businesses. At the end of the day, people aren't going to want to work in a hotel for x amount when they can go and earn a heck of a lot more in the oilpatch.”

Research done by the Alberta Chambers of Commerce suggests that by 2020 there will be 100,000 jobs available in the province needing to be filled, and Kobly took a practical view at why this could be a significant problem moving forward.

“There simply have not been enough children born to keep up with the high rate of retirement we're seeing now, which effectively decreases the number of working-aged people in the province,” he explained. “This is an issue all over Canada, but specifically here in Alberta because of the already low unemployment rate. Families are getting smaller – you don't see people having five or six-kid families anymore.”

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