A report by Statistics Canada says the retail trade sector experienced notable shifts in workforce composition over the last few years.
“While the sector continued to employ a predominantly young workforce, the share of younger employees declined from 2017 to 2024, while the share of employees aged 55 and older increased, indicating a gradual aging of the workforce,” said the federal agency.
“The sector continued to employ slightly more women, and the majority of employees remained part-time workers. The residency status of the retail trade workforce shifted notably during and after the pandemic, with increased reliance on non-permanent residents—such as international students, temporary foreign workers, and others without Canadian citizenship or permanent residency—reflecting their growing role in the available labour supply.”
While employment has continued to grow in recent years, gains were uneven across the sector, with some subsectors yet to return to pre-pandemic levels, said the report.
AI adoption and technology reshape retail employment
“This may reflect businesses capitalizing on technological efficiencies, including self‑checkout systems and a reduced reliance on brick‑and‑mortar locations as e‑commerce continues to reshape how retailers interact with consumers. These technological shifts are occurring alongside the rapid expansion and use of artificial intelligence (AI) by retail trade businesses,” it said.
“Recent empirical analysis suggests that workers in the retail trade sector face moderate exposure to AI‑related job transformation and displacement. Over the past two years, the proportion of businesses in the retail trade sector using AI has increased nearly fivefold, reaching 19.2%.
“Looking ahead, operators in the retail trade sector may continue to face challenges over the near term, including further integration of AI into operations, ongoing trade tensions and geopolitical developments, inflationary pressures, rising input costs, and evolving trends in domestic business investment and population growth.”
Four subsectors account for more than two-thirds of retail sales
As of 2024, more than two-thirds of total retail sales came from four subsectors: motor vehicle and parts dealers (27.4%), food and beverage retailers (18.4%), general merchandise retailers (12.7%), and gasoline stations and fuel vendors (9.9%), said Statistics Canada.
“Canadian retailers faced significant challenges during the pandemic as public health measures, including temporary closures of non-essential businesses and capacity limits, constrained operations. Impacts varied widely across the sector. Essential businesses, such as food and beverage, general merchandise, and health and personal care retailers, saw sustained sales growth, while discretionary subsectors, including clothing, clothing accessories, shoes, jewellery, luggage and leather goods retailers and motor vehicle and parts dealers, experienced notable declines in 2020 before rebounding in subsequent years,” said the report.
Inflation and interest rates affect consumer spending
“Although retail sales have risen since 2020, sector growth has moderated as higher interest rates and widespread price increases have dampened purchasing power, shifting spending toward essential goods, such as food and automotive fuels, and away from discretionary categories, such as clothing and home furniture, furnishings, housewares, appliances and electronics. While nominal retail sales in 2024 were substantially higher than before the pandemic, real growth was much more modest once price increases are taken into account.”
Retail employment remains relatively stable
Statistics Canada said data from the Survey of Employment, Payrolls and Hours show that while employment in the sector fell 8.2% in 2020 as a result of the initial pandemic disruptions, employment rapidly recovered, with most subsectors returning to pre-pandemic levels in 2021.
“However, with the growing shift toward e-commerce and changing consumer preferences, employment levels in certain retail trade subsectors remained below 2019 levels. Overall, employment in the retail trade sector has been relatively stable, increasing by 0.6% from 2019 to 2024. Food and beverage retailers remained the largest employer in the sector, accounting for 27.0% of the sector’s 2.0 million employees in 2024. General merchandisers were the second-largest employer (13.2%), followed by motor vehicle and parts dealers (11.3%),” it said.
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