In the days before the latest job numbers were released by Statistics Canada, Andrew Scheer and the Conservatives began trying to create a narrative about a “jobs crisis” in Canada, citing the job losses in the energy sector due to the oil price differential, along with the planned closure of that GM plant in Oshawa. The news of record job numbers and the lowest unemployment levels since comparable statistics started being recorded in the late 1970s derailed that talking point, at least for now, but it doesn’t mean that there aren’t warning flags that the government should keep their eyes on.
The Bank of Canada, meanwhile, has been keeping an eye on labour shortages across the country (well, except for resource-intensive provinces like Alberta). Indeed, in Ontario, Quebec and BC in particular, labour shortages are acute, and have been restricting businesses’ ability to meet demand, and many of those shortages are in skilled occupations, particularly IT. In previous quarters, there were also shortages reported in construction, transportation, and lower-paid, less-skilled occupations, but those appear to have abated. The structural problems in the job market around aging populations and changing occupational preferences remain, however.
In a March speech, Bank of Canada Governor Stephen Poloz said that lowering barriers that prevent women, Indigenous communities and other minorities – some half-million workers – the country could grow the GDP by 1.5 percent or $30 billion a year, in advance of productivity gains. In a September speech, Poloz noted that in an age of digital disruption, Canadian companies face a choice about whether to invest in their own workforces in order to meet their labour needs. After all, it’s one thing to demand that schools teach kids how to code, but it’s another for a company to take responsibility for its own workforce development, which allows them to be more adaptable and to gain an edge over their competitors who are facing similar shortages.
It does appear that some companies have been paying attention. In the Bank’s most recent Business Outlook Survey, released just before the Christmas break, it found that two-thirds of businesses have started taking action, such as increasing recruiting efforts outside of their usual comfort zones and are tapping more recent graduates and immigrants. Others have been raising wages, while others are enhancing non-wage compensation – things like vacation days and perks to attract and retain more workers. Others have offered more overtime, contracted out more work, and invested in automation. The service sector has been increasing productivity through things like training for existing employees. This could indeed be part of why the job numbers have been growing beyond expectations.
But amidst this good economic news, I have to wonder how much the government is paying attention to the places where they are most vulnerable in the job sector – low-skilled workers, particularly young men, which has a particularly large effect on the situation in Alberta. The lure of big paycheques in the oil patch has long been a siren song, not only for young men in the province but also from elsewhere in the country, and for a while, there needed to be some action taken to ensure that they at least finished high school before they started working in the patch. As the economy transitions, how much can green and clean-tech industries lure away those low-skilled patch workers, or how can high-skilled manufacturing bring aboard the low-skilled labour that the sector has long relied upon but is increasingly moving away from? And while Ontario has been dealing with the decline of its low-skilled manufacturing sector for a couple of decades, I’m not sure that Alberta has yet grasped the bigger picture of what longer spells of unemployment mean for its young men because of consistently low oil prices – prices that may remain low given the global supply glut that shows little sign of abating anytime soon, even outside of the difficulty that the province has in getting product to market because successive governments have fallen down on the pipeline files.
This is where I have serious concerns about how this government is going to be able to manage the transitioning labour force in any kind of coherent way. While education is a provincial responsibility, the federal government does offer things like employment insurance for displaced workers who need retraining, all manner of grants and loans for those who are looking to get into skilled trades, and tax credits for workers and employers involved in apprenticeships. Skilled trades are one area in particular that we keep hearing about a growing need for in the economy, but have seen little boosterism for by the federal government. There have been some targeted measures to try and encourage more women to get into skilled trades (which, curiously, the Conservatives have taken exception to despite the fact that they offered similar programmes under their tenure), but I have yet to see any kind of recruitment strategy.
Whenever labour shortages come up, this government likes to talk in platitudes. Labour minister Patty Hajdu has responded to questions with lines like “we are working extremely hard to make sure that every Canadian has the skills needed to take advantage of these job opportunities,” but that’s vague and hand-wavey at best. It’s not like they haven’t been investing in these kinds of training programs – they have, and it’s done in a way that’s actually been responsive to the kinds of needs being identified by the Bank of Canada and others, but you wouldn’t know it based on their own messaging – something they tend to step all over at every available opportunity. But we have heard very little from them on how to deal with this looming issue, particularly in Alberta, of how to deal with these low-skilled workers who are being displaced by low oil prices. As while the anger in the province simmers with demands for pipelines – as though there were a magic wand to be used – it may behove the federal government to make a bigger effort to showcase the exit ramps from these low-skilled jobs that are dependent on boom and bust cycles, and show that they are working to ensure that they are dealing with the skills mismatch that is dragging on our economy.
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