In both countries, the unemployment rate does not fully capture the labour market slack. In both the United States and Canada, there are still elevated levels of long-term unemployment and involuntary part-time employment, while wage gains continue to be moderate relative to historical norms (Chart 10).
﻿[ 1] This focus has made firms wary of increasing wages, lest it hurt their competitiveness in an environment where it is difficult to increase prices. Many have instead relied on non-wage alternatives to attract and retain staff. Higher wages have often been seen as a last resort, especially in an environment where the supply side of the labour market is so flexible.