MONCTON – A study by the Business Development Bank of Canada (BDC) found labour shortages in Atlantic Canadian provinces are the most acute in the country, with 50 per cent of businesses having difficulty hiring new workers. BDC’s Chief Economist Pierre Cléroux said the problem won’t go away so soon.
Nationally, an average of 39 per cent of employers indicated it’s difficult to hire new employees with British Columbia (45 per cent) and Ontario (40 per cent) also above the national average.
Cléroux said the issue is more prominent in Atlantic Canada because it’s not only facing a wave of retirements from aging Baby Boomers like the rest of the country, the region has also seen many young people leave in the last decade.
“As a result, the number of young people entering the workforce is even lower than the rest of the country, or it’s lower than what it should be. That’s the reason why this shortage of labour is more accentuated – it’s more acute – in the Atlantic provinces,” he said.
In addition, there’s a mismatch between the skills employers are looking for and those possessed by workers in the region, Cléroux said. So, even when there are people looking for jobs, employers still struggle to look for workers.
This is hurting growth for businesses big and small, with the manufacturing, retail trade and construction sectors taking the hardest hit.
“The research is showing businesses are refusing contracts. Sometimes they can’t offer some services. For example, some restaurants wouldn’t offer breakfast anymore just because they can’t find the people. In the manufacturing sector, a lot of our clients export as much as they can but they refuse sometimes work just because they don’t have enough people to work for them,” Cléroux said.
Despite increasing demand from abroad, Canadian companies are often not able to fulfill that and choose to pass on opportunities.
“I was in Moncton at the beginning of the summer, and people, especially in the manufacturing factor, they just don’t do all the contracts they can because they don’t have the people to do the work,” he said.
It’s limiting growth, which is too bad for business, too bad for people and too bad for the economy.”
With the threat of a slowing economy regionally and nationally, BDC is urging businesses to think differently when it comes to hiring workers.
“The labour force is changing. It’s shrinking. That’s the reason we want to raise awareness, to send the message that business owners have to manage their labour force differently and they have to look at underrepresented parts of the population in the labour force much more than in the past,” Cléroux said.
The study found that among strategies to find workers, entrepreneurs were least likely to consider hiring immigrants and newcomers to Canada. Even though Statistics Canada figures show immigrants will account for about two-thirds of the country’s population growth in 2022 and up to 80 per cent a decade after that, BDC said only 18 per cent of Canadian entrepreneurs look to immigrant workers to fulfill their talent needs.
Yet, Cléroux noted that the newcomer community, people with disabilities and Indigenous communities have higher unemployment rates than the general population.
“Obviously we have a mismatch here again. People have to change their vision or their perception about hiring people,” he said.
Businesses also need to implement stronger human resources policies, which will facilitate hiring, improve retention and reduce legal and reputational risks, among other things, BDC’s report said. They also need to market themselves as great employers and take advantage of automation to reduce the need for staff where possible.
They have to market themselves on social media that they are a good employer. They have to be more flexible as well,” Cléroux said. “People have a choice. They will go to work for companies who offer a more interesting workplace, a more flexible workplace.”
BDC’s report found that companies that allow employees to work from home some days, or have amenities like an in-house gym, are among businesses that successfully retain and recruit skilled workers.
“These things increase the value of your business for millennials,” Cléroux said.
“But the most important part for businesses is to realize that [the labour shortage] is not for the next few months. It’s going to be around us for the next 10 years,” Cléroux warned. “As a result, we have to deal differently, we have to think differently about recruiting, about managing our business.”
For those who have been in the workforce for a while, Cléroux said there needs to be re-training, whether that be through government programs or educational institutions.
“The demand for skills is changing,” he said. “We have to do a better job to help people to get skills that are needed in the market today.”