Cautious employers and hesitant job seekers have created a rare standstill in Canada’s labor market – but that calm may not last much longer.
According to Cal Jungwirth (pictured), director of permanent placement services at Robert Half in Edmonton, both companies and candidates are in a holding pattern as economic uncertainty and cost pressures persist.
In an earlier conversation with Insurance Business, he noted that employers across industries – including insurance – have been “very cautious when putting any sort of cost into their business,” while workers, squeezed by the rising cost-of-living, are also reluctant to take risks.
Right now, organizations are trying to keep their costs as low as possible, and candidates are hesitant to move because of the uncertainty, Jungwirth said. “It’s created this unique situation where everyone’s waiting for clarity before making a move.”
Jungwirth said that the dynamic is unlikely to hold through 2026. As confidence gradually returns and companies begin to hire again, he expects pent-up movement in the job market.
People have been very passive and haven’t been too aggressive in their job search, he explained. “Eventually, there’s going to be job churn – people will start to make a move, start looking to take that next step.”
If growth picks up next year, the result could be a sudden shift from a cautious environment to one marked by intensified competition for skilled professionals.
“All of a sudden, there’s a little bit more hiring and a little bit more candidate activity,” Jungwirth said. “That’s when things start to happen quickly – and when employers start fighting for the best talent, it can become a candidate’s market.”
Much of the current hesitation, he added, stems from fear of instability. Many workers are reluctant to leave their current roles because they worry about being the “last in, first out” if layoffs occur, he said. That mindset has kept many professionals rooted in place longer than usual, contributing to the hiring stalemate seen across much of the market.
Jungwirth cautioned that organizations shouldn’t wait for churn to begin before acting. Strong retention strategies, he said, are the most effective defence against costly turnover.
“I always go to retention first,” he said. “If you don’t have strong retention policies, then you find yourself hiring.”
He advised employers to proactively engage with their top performers before the job market heats up. “Put your arms around your top performers,” he said. Employers should maintain honest, ongoing discussions with their top performers about how engaged they feel and where they want their careers to go. While turnover is inevitable, he noted, leaders can influence it – and the most effective way to do so is through regular conversations.
Periods of renewed economic activity, he added, often expose gaps in retention strategy. If the economy picks up steam in 2026, organizations that haven’t built engagement with their top performers will be playing catch-up, he said. Companies that maintain open communication, he added, are better positioned to prevent turnover when opportunities increase elsewhere.
But even as employers prepare for a more competitive labor market, many are re-evaluating workplace policies that could make or break retention efforts.
One area where employers risk losing ground, Jungwirth warned, is the push to bring workers back to the office full time.
Organizations are encouraging either an increased return to office or a full RTO, and they’re doing it for a variety of reasons, which may be good for the business, he said. “But you will lose people, because people now value flexibility and the option to be somewhat hybrid.”
He noted that Robert Half regularly hears from employees seeking new opportunities after their companies announce mandatory in-office policies. “It’s pretty regular for us to get a call from somebody whose employer just announced they’re going back to the office five days a week,” Jungwirth said. “That individual is now initiating a new job search.”
If the economy gains strength in 2026, the risk of that strategy could grow. “Absolutely,” Jungwirth said. “Because people have more options. The more organizations that return to the office fully, the fewer that offer flexibility – and that will make hybrid work an even greater differentiator for those that continue to provide it.”
