Shortage of skilled workers makes for higher cost of living, say experts

'This is all interconnected in ways that sometimes people underestimate'

Shortage of skilled workers makes for higher cost of living, say experts

One reason many Canadians are struggling with finances these days is the labour shortage that numerous sectors are experiencing, according to a report.

A lack of transportation mechanics is driving up the cost of bus fare and plane tickets; a shortage of cooks is affecting menu pricing at restaurants, said Simon Gaudreault, chief economist and vice-president of research for the Canadian Federation of Independent Business (CFIB) in a CBC report.

 "Anybody can expect to bear some of [the] impacts of this shortage," he said. "This is all interconnected in ways that sometimes people underestimate.”

“It's a bad time to be a consumer if you want anything done that involves a tradesperson,” said Mandy Rennehan, founder and CEO of construction company, in the CBC report.

"It used to be 70 or 80 bucks for somebody to come to your house as a service call just to look at your dishwasher; now you're going to pay double that.”

The British Columbia construction industry managed to cut the projected number of job openings to 6,6000 skilled workers by 2033 from the 26,100 short-fall estimated for 2023 a decade ago. But despite the 9% growth in the number of ICI construction companies in B.C. over the past five years (28,014), the number of tradespeople in the industry has dropped 7% during the same timeframe (167,300). 

Also, the Canadian Agricultural Human Resource Council (CAHRC) forecasts that the agriculture sector will have about 100,000 unfilled job positions by the year 2030.

The latest version of the organization's Restaurant Outlook Survey – conducted by Restaurants Canada online last fall among 470 respondents representing 4,119 restaurant locations – found respondents expected menu prices to go up another 6% in 2024, noted CBC.

What is the main reason for ongoing labour shortages?

There are numerous factors that have led to a widespread shortage of workers in Canadians sectors, according to experts interviewed by CBC.

One factor is retirement. Over 700,000 skilled trades workers are expected to retire between 2019 and 2028, creating "an ever-growing need to recruit and train thousands of skilled tradespeople," according to Employment and Social Development Canada.

Another factor is the culture in Canada that exalts university education and knowledge work over apprenticeship, said Rennehan.

The field of apprenticeship is seeing some impressive growth. The Ontario government, for example, increased apprenticeship registrations by 24% in 2022 – from 21,971 to 27,319. In total, there were 91,634 apprentices active in Ontario as of April 3, 2023.

However, there can be barriers to landing an apprenticeship position, such as finding an employer willing to take on someone with no experience, or limited spaces at colleges, said Rennehan, and this also leads to labour shortages.

How can we fix the labour shortage in Canada?

To help address shortages, CFIB members noted that they need flexibility around training, like allowing a licensed tradesperson to take on more apprentices at a time, for example, said Gaudreault.

It would also help if Canada's system of evaluating immigration candidates gave more weight to those who have experience in the trades, he said.

"When you look at the scoring system, a lot of the points go towards, like, having a master's or having a bachelor or having a PhD. And I am not sure that we put enough points perhaps on the skills that are really in demand right now on the job market.

"I'm not saying that having a PhD is not a great thing, but perhaps we can do both, right?"

New Canadian permanent residents’ income has improved in comparison to the general population, according to a report from The Office of the Parliamentary Budget Officer (PBO).

Canada aims to welcome 485,000 new permanent residents in 2024, 500,000 in 2025 and plateau at 500,000 in 2026, according to Immigration, Refugees and Citizenship Canada.

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