Labour shortages are holding back the construction sector: Here’s what governments and businesses can do
October 9, 2019 by Dan Kelly
Having the right people for the job can make or break a small business. With a smaller team to rely on and fewer resources to devote to hiring, any unfilled position is a strain on productivity. So it’s not surprising that when I speak with contractors and other business owners, the shortage of qualified labour is one of their most pressing concerns.
In fact, the shortage of skilled labour is the top factor limiting businesses’ sales and production growth, according to CFIB’s most recent monthly survey. A vacant post means work goes undone or causes a heavier load on your other employees – and often on you as the business owner. Last quarter, more than 429,000 jobs across the country had remained vacant for more than four months. That’s a lot of lost opportunity.
The situation is particularly harsh in the construction sector – while the national job vacancy rate sits at 3.2 per cent, construction businesses are facing a staggering 4.8 per cent vacancy rate, which represents 51,400 unfilled positions. It’s going to get worse, too: the Canadian Construction Association predicts that Canada is due to lose nearly a quarter-million construction workers in the next decade due to retirement.
One part of the problem is that high schools rarely promote the skilled trades as career paths to their students, instead focusing on traditional, white-collar work. Our education system often pushes young people into university education, forgetting there are fantastic opportunities for graduates of colleges, trade schools and on-the-job training opportunities. Students need to be exposed to the jobs that exist in the skilled trades and given more opportunities to try them out before graduating.
In our Youth Employment Report last year, CFIB recommended that educational institutions create more Work-Integrated Learning (WIL) opportunities within the skilled trades and involve employers in curriculum development. This would help young people come out of secondary education with a better idea of what jobs are out there and are right for them.
But it’s not as simple as putting any warm body in the job. You need employees with the right combination of skills and attitude – something that’s proving difficult for many small business owners. In fact, only 32 per cent of employers are satisfied with the job high schools are doing to prepare young workers for the labour force, according to CFIB’s data. Too often, I hear from employers that their biggest challenge is finding people who will show up at work on time or work a full week without disappearing. This is why hiring and training young workers can be so costly – it’s a big investment of time and often there is a learning curve before the employee can be as productive as a more experienced worker.
With the federal election coming up, CFIB has asked all parties to include measures in their platforms to offset the investments made by SMEs in both formal and informal, on-the-job training, such as instituting an EI holiday for workers under 24 and creating a training tax credit.
The immigration system can also help alleviate the labour shortage, but it needs to be retooled for today’s labour market. Currently, the immigration system prioritizes applicants with multiple degrees
and diplomas. Canada has a real need for workers in construction, agriculture and personal services, but the process for recruiting them from abroad can be so onerous and expensive it isn’t worth it.
CFIB has proposed the “Introduction to Canada Visa,” a program that would create a pathway towards permanent residency for Temporary Foreign Workers (TFW) at all skill levels, bringing more prospective staff into the workforce. Under the program, TFWs would work with an employer for a minimum of two years as a defined step towards their permanent residency.
We will continue to advocate for all of these measures at the federal and provincial levels, but governments are slow to act. In the meantime, you should make use of every resource you have available to attract and retain your workers.
If you’re an independent business owner, you may be wholly responsible for recruiting, training and overseeing employees, along with staying compliant of employment laws and regulations. Make sure you understand what your obligations are and get the best advice possible. Business and professional associations are a great place to start and may be able to help you access additional resources if you need help.
In some cases, you can also consider offering an overall benefits package to your employees and prospective hires. You may think these programs are too expensive and complex for your small business to compete with the big guys, but your business association may have access to special rates and group discounts.
Owning a small business can be a lonely calling, particularly when you’re understaffed. The current labour shortage is especially challenging for businesses that want to grow and thrive. Having someone in your corner, with the right mix of policy solutions and support, can make all the difference.
Dan Kelly is the president, CEO and chair of the board of governors of the Canadian Federation of Independent Business, Canada’s largest association of small and medium-sized businesses. The organization represents over 110,000 members across every sector and region, including more than 12,000 in construction.