On-Site Magazine

$38 billion in lost revenue due to labour shortages

By Adam Freill   

Construction Labour

CFIB says Canadian small businesses in the construction sector are hardest hit when it comes to losing out on revenue opportunities.

(Photo: Rapeepat Pornsipak / iStock / Getty Images Plus /Getty Images.)

Small businesses in Canada missed over $38 billion in revenue opportunities last year because they had to turn down or postpone contracts or sales due to labour shortages, finds a new report by the Canadian Federation of Independent Business (CFIB).

“We always knew labour shortages came at a high price to small businesses. Staffing challenges cause employers to work more hours, reduce their hours of operation and decline services and contracts, simply because they can’t find enough staff to fully operate their business,” said Laure-Anna Bomal, CFIB’s economist and the report’s author. “In fact, we estimate the business opportunities that small businesses lost in just one year due to labour shortages are worth over $38 billion. While it doesn’t necessarily mean the Canadian economy lost the same amount, it’s still a significant share of revenue that small businesses could have used to invest in automation or growing their business.”

Small businesses in the construction sector faced the most significant loss of business opportunities, over $9.6 billion in the last year.

A single policy change will not address these labour shortage pressures, but a collection of them might provide some relief, says CFIB. The organization conducted a detailed review of how other jurisdictions are addressing their labour shortages to compile a whitepaper on how to address various barriers to work.


To increase workforce participation among youth, the organization suggests that governments could increase the prevalence of work-integrated learning in high schools. CFIB added that, among the core-age group, employment insurance program design shouldn’t create disincentives to work, and that governments need to facilitate labour mobility across provinces. Among the other options presented were also to revisit existing tax policy and/or create a tax credit for career extension for experienced workers.

“As Canada’s population is aging, we need to ensure that those who are willing to work can do so without significant challenges. In the long run, the shortages will get worse, as will their costs, unless we change our labour market approach,” said Christina Santini, director of national affairs at CFIB. “We urge governments to find innovative ways to increase participation in the labour market among all age groups.”




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