Labour Shortages Could Cause Local Businesses To Cancel Expansion Plans, Says Report
HALIFAX – A report by the Canadian Federation of Independent Business (CFIB) found that Atlantic Canada’s labour force is shrinking rapidly and small businesses are being forced to adapt to this difficult reality, with more than one in five businesses in the region are considering cancelling expansion plans because they can’t find workers.
“With staffing difficulties, a lot of what you end up seeing is the business owner just ends up doing the work themselves. But 22 per cent are considering cancelling expansion plans because they couldn’t find the labour that was necessary to build their business. That’s a very significant number,” said Jordi Morgan, CFIB’s vice president for Atlantic Canada.
“Finding workers with the right skills – we have 68 per cent of our respondents here in Atlantic Canada that said that was the biggest issue when it comes to staffing difficulty…Almost half were for occupations where on the job training is required.”
Finding enough workers (20 per cent), employee turnover (20 per cent) and replacing staff members that are retiring (13 per cent) are other key issues.
More than one-third of businesses find it difficult to fill roles that require college education or apprenticeship training in the last two years, and 17 per cent have difficulty hiring for jobs that require secondary school and/or occupational training.
Only 10 per cent have difficulty hiring professionals for roles that require university education and eight per cent find it difficult to fill managerial positions.
Immigration is the top tool being used to counter population decline, but programs tend to target only highly-skilled, highly-educated newcomers, the CFIB says. The report found regional small business owners urgently need workers at all skill levels.
The CFIB is again recommending a program called Introduction to Canada Visa to retain lower-skilled workers and to complement the Atlantic Immigration Pilot Program.
“The Introduction to Canada Visa, which we’re advocating for, means it simply provides a path towards permanent residency for workers who are already in the country and who are employed,” Morgan said.
While there are certain areas where highly-skilled, highly-educated workers are needed, CFIB’s report says lower-skilled workers are needed in virtually all sectors from agriculture to hospitality.
“I think there are a lot of areas where high-end, skilled workers have an opportunity to come to Canada and [those opportunities] aren’t available to lower-skilled workers,” said Morgan. “What we’re finding is that with increasing labour shortages, there are opportunities for people with lower skillsets to be employed in Canada and there are a lot of employers who are looking for people for those roles because the population in Canada isn’t going to fill them.”
“We want to see federal immigration folks understand that this is a critical need and do something about it,” he said.
While labour supply ebbs and flows in Atlantic Canada like anywhere else, its aging demographic and low immigrant retention rate are creating a “crisis,” Morgan said. The Atlantic Provinces lag behind the rest of Canada in immigrant retention, with New Brunswick retaining only 52 per cent of newcomers over five years.
“Immigration is not the only answer, there are a lot of other things that have to be addressed. But it’s certainly one big piece of the puzzle, and matching immigration recruitment to small business needs as well,” he said.
These issues are negatively affecting economic growth, even if there is expansion in certain urban centres in Atlantic Canada, Morgan said.
The report is the third of a series focusing on the challenges Atlantic Canada faces due to an aging demographic. This latest report particularly looked at the staffing challenges small businesses face, and the kinds of investments they’d need to make to succeed in a future where workers will become harder to find.
To innovate and stay productive, many businesses are also investing in equipment and other technology. But high taxes, regulatory burden and rising federal tax loads like CPP and the carbon taxes make it more difficult for small enterprises to invest in future projects, according to the CFIB.
There has been positive support from the federal government recently to help businesses invest in innovative technology to help them remain competitive. But more needs to be done both provincially and federally, Morgan said.
“We want to make sure government programs are focused on small businesses as well, not just big businesses,” he said.