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National Occupation Classification (NOC) System

The National Occupational Classification (NOC) is the national reference for occupations in Canada. It provides a systematic classification structure that categorizes the entire range of occupational activity in Canada for collecting, analyzing, and disseminating occupational data for labour market information and employment-related program administration.

Why is the NOC important?

Occupational information is of critical importance for the provision of labour market and career intelligence, skills development, occupational forecasting, labour supply and demand analysis, employment equity, and numerous other programs and services.

What is an occupation within the NOC?

An occupation is defined as a collection of jobs that are sufficiently similar in work performed to be grouped under a common label for classification purposes. A job, in turn, encompasses all the tasks carried out by a particular worker to complete their duties.

How are occupations classified within the NOC?

The basic principle of the classification of the NOC is the kind of work performed. Job titles are identified and grouped primarily in terms of the work usually performed, this being determined by the tasks, duties, employment requirements, and responsibilities associated with each occupation. Factors such as the materials processed or used, the industrial processes and the equipment used, the degree of responsibility and complexity of work, as well as the products made and services provided, have been taken as indicators of the work performed when combining jobs titles into occupations and occupations into groups.

How are job titles organized within the NOC?

The NOC comprises more than 40,000 job titles gathered into 516 unit groups, organized according to six Training, Education, Experience and Responsibilities (TEER) categories and ten broad occupational categories. Unit groups are based on similarity of tasks, defined primarily by functions and employment requirements. Unit groups can often be linked directly to one occupation (such as NOC 31110 – Dentists) or to more than one occupation (such as NOC 72600 – Air pilots, flight engineers and flying instructors). Each unit group provides a short description of its associated occupation(s), lists its main duties and employment requirements, and provides examples of job titles.

Who uses the NOC?

Students, workers, employers, career and vocational counsellors, and educational and training organizations use the NOC on a daily basis to support career and vocational decisions. The classification is also used to support policy development and program design and administration as well as service delivery.

Who maintains the NOC?

The NOC has been developed as part of a collaborative partnership between Employment and Social Development Canada and Statistics Canada. The two departments also work together to maintain and update the NOC. The NOC 2021 version focused on structural changes, such as the move to a 5-digit system and the introduction of a new six-tiered TEER category to replace the skill levels. Updates to the classification will continue on a regular basis.

What are the main occupational categories of the NOC?

The 10 broad occupational categories in the NOC 2021 system with example job titles include:

• Legislative and senior management occupations: CEO, Director, Senior Manager
• Business, finance and administration occupations: Accountant, Financial Analyst, Human Resources Manager
• Natural and applied sciences and related occupations: Engineer, Biologist, Computer Programmer
• Health occupations: Nurse, Doctor, Dentist
• Education, law and social, community and government services occupations: Teacher, Lawyer, Social Worker
• Art, culture, recreation and sport occupations: Musician, Artist, Athlete
• Sales and service occupations: Sales Representative, Customer Service Representative, Cook
• Trades, transport and equipment operators and related occupations: Electrician, Plumber, Truck Driver
• Natural resources, agriculture and related production occupations: Farmer, Forester, Fisherman
• Manufacturing and utilities occupations: Machinist, Production Supervisor, Power Engineer

For more information visit the National Occupation Classification area on the Government of Canada website.

North American Industry Classification System (NAICS)

The North American Industry Classification System (NAICS) is a standardized method used in Canada, the United States, and Mexico to classify businesses based on the type of economic activity they engage in. The NAICS system consists of 20 sectors, which are then further divided into sub-sectors, industries, and sub-industries.

Each business is assigned a six-digit NAICS code, which is used by government agencies to collect data on the economy, to develop policies related to industry and trade, and to provide information to businesses and investors.

Examples of sectors and industries under NAICS include:

• Agriculture, forestry, fishing, and hunting: Crop Production, Animal Production, Fishing, Logging
• Mining, quarrying, and oil and gas extraction: Coal Mining, Metal Ore Mining, Oil and Gas Extraction, Support Activities for Mining
• Utilities: Electric Power Generation, Natural Gas Distribution, Water and Sewage Treatment
• Construction: Residential Building Construction, Non-Residential Building Construction, Heavy and Civil Engineering Construction
• Manufacturing: Food Manufacturing, Chemical Manufacturing, Machinery Manufacturing, Textile Mills
• Wholesale trade: Motor Vehicle and Parts Wholesaling, Chemical and Allied Products Wholesaling, Wholesale Electronic Markets and Agents and Brokers
• Retail trade: Motor Vehicle and Parts Dealers, Building Material and Garden Equipment and Supplies Dealers, General Merchandise Stores
• Transportation and warehousing: Air Transportation, Truck Transportation, Warehousing and Storage
• Information: Publishing Industries, Motion Picture and Sound Recording Industries, Data Processing, Hosting, and Related Services
• Finance and insurance: Banking and Credit Intermediation, Securities, Commodity Contracts, and Other Financial Investments and Related Activities, Insurance Carriers and Related Activities
• Real estate and rental and leasing: Lessors of Real Estate, Offices of Real Estate Agents and Brokers, Automotive Equipment Rental and Leasing
• Professional, scientific, and technical services: Legal Services, Accounting, Tax Preparation, Bookkeeping, and Payroll Services, Architectural, Engineering, and Related Services
• Management of companies and enterprises: Corporate, Subsidiary, and Regional Managing Offices
• Administrative and support, waste management and remediation services: Office Administrative Services, Waste Collection, Remediation Services
• Educational services: Elementary and Secondary Schools, Colleges, Universities, and Professional Schools
• Health care and social assistance: Ambulatory Health Care Services, Hospitals, Social Assistance
• Arts, entertainment, and recreation: Performing Arts Companies, Spectator Sports, Amusement Parks and Arcades
• Accommodation and food services: Accommodation, Food Services and Drinking Places
• Other services (except public administration): Personal Care Services, Repair and Maintenance, Religious Organizations

The NAICS system is a valuable tool for businesses and government agencies looking to understand the economic landscape and trends within a particular sector or industry. It can also help businesses identify potential competitors, suppliers, and customers.

For more information visit the North American Industry Classification System area on the Statistics Canada website.

Skills

A skill, by definition, is the ability obtained from knowledge to do something well. When employers communicate their skill needs clearly, it gives job-seekers and career professionals insights to make informed decisions regarding training, education and job opportunities.

Why do skills matter?

Knowing which skills are in demand allows each person to follow a rewarding career path in their field of interest. It’s also important information for policymakers, job-seekers and employers.  Canada’s continued economic success relies on our collective ability to improve skills-related policies and programs.

Are skills the same as knowledge or abilities?

Generally, an “ability” is a capacity or attribute required to engage in a task. It can be thought of as the potential for carrying out an activity. For example, to communicate orally with others, an individual must possess the “ability” to access and use the part of the brain needed for speech and language processing. That is, they must have the potential for communication.

“Knowledge” pertains to information. It can be factual, such as knowledge of terminology. It can be conceptual, such as knowledge of theories, models and principles. It can be procedural, such as the knowledge of techniques and methods. Or, it can be metacognitive, such as self-knowledge.

“Skills” are at the nexus of abilities and knowledge. They involve the exercise of one’s ability and knowledge to carry out a specific task.

What about tools and technologies?

Skills are distinct from “tools and technologies.” It is common in job postings, for example, to see SAS or Python listed as skills, but technically speaking, these should be labelled as tools and/or technologies.

For instance, an individual could analyze data by building a statistical model (skill) using SAS (tool) or create a natural language processing algorithm (skill) in Python (tool). This difference is important, especially in the context of skill transferability, in which the skill one has developed is similar across different occupations but maybe the tools are different. In this case, a candidate who may lack knowledge of a specific tool, say a statistical modeller who uses SAS versus one who uses Python, can very easily acquire the knowledge to succeed in the other.

Skills + knowledge + abilities = competencies

The combination of skills, knowledge and abilities are known as “competencies“. They often include a specified level of performance at which a skill should be executed and are commonly used in the discipline of Human Resources (HR) and in creating occupational standards, such as with the Red Seal program.

The video below from the Labor Market Information Council provides a good summary of skills and how they combine with knowledge and abilities:

What is a labour market?

When people think of markets, they often think of a physical or virtual market where people exchange goods and services.  

But what is a labour market?

A labour market is a type of market in which “buyers” (employers) and “sellers” (job seekers) exchange services. As an employee, you exchange your talent and effort for remuneration in the form of a wage, salary, bonus, or other payment.  

In this context, the items exchanged in the market are your time, knowledge, skills, and abilities, all bundled together. Economists often refer to these as human capital.

Demand and supply in a labour market

Labour markets are driven by demand and supply. 

The number of workers organizations hire and want to hire indicates labour demand. The number of workers who are already hired indicates met demand, while the number of workers that organizations are trying to hire—but haven’t, yet—indicates unmet demand.  

These measures of demand count individual people—but what is exchanged are the services people offer. 

Employers make decisions about their labour requirements based on many factors, including productivity (how much workers can produce and how quickly), costs (wages, pensions, training), and the results of workers’ efforts (output).  

This means that a wide range of factors affect the total demand for workers, including technology, group dynamics among workers, and expected future output. 

Labour supply typically refers to the number of people working or actively looking for work. Factors such as population size, retirement, migration, immigration, education and training, societal standards, economic conditions, and reproduction rates all influence labour supply.

Regional labour markets in Canada

All Canadian regions, municipalities, provinces, and territories have labour markets. These are unique and can overlap.  

There is an uneven distribution of labour supply among and between regions, subregions, and rural and urban labour markets. This is because labour supply depends on the size and participation rate of the local population, the pace of growth, and migration. 

The precise borders of these regional labour markets can fluctuate based on many factors. For example, people within commuting distance of a large city are more likely to participate in that city’s labour market, and people willing to migrate for quality work may be seeking opportunities outside of the region in which they live.  

As job conditions, wages, and demand fluctuate, the borders of labour markets also fluctuate as workers move in, among, and across different regional labour markets.

LMI helps us understand Canada’s labour markets

Labour market information (LMI) is data, research and any information that helps people make informed decisions about the labour market. 

The Labour Market Information Council (LMIC) works to empower all people in Canada with the knowledge and insights they need to succeed in a dynamic labour market.  

There are many ways LMI can help to prepare individuals, organizations, and institutions to navigate the labour market. LMI on occupations, for example, can help people make important decisions about study and training, first jobs, or the next step in their career. Quality and timely LMI also allows individuals, organizations, and institutions to prepare for the economy of tomorrow by projecting the future of work and encouraging development that can take the Canadian economy in new, productive directions. 

The best LMI provides information to make positive labour market changes that benefit everybody. 

Source: Labour Market Information Council

What is LMI?

Source: Labour Market Information Council