Industry Committee on Feb. 7th, 2013

[The Chair, Conservative, David Sweet]

I call the meeting to order.

Good afternoon, ladies and gentlemen. Welcome to the 56th meeting of the Standing Committee on Industry, Science and Technology. Today we're pursuing some insights on engineering.

In front of me are our witnesses. I'll introduce them very briefly.

From Engineers Canada, we have Marie Carter, chief operating officer.

As an individual, we have Claude Laguë, dean and professor of the Faculty of Engineering, University of Ottawa.

From the Association of Consulting Engineering Companies—Canada, we have John Gamble, who is the president.

From the Canadian Academy of Engineering, we have Richard Marceau, who is the president.

From the Natural Sciences and Engineering Research Council of Canada, we have Janet Walden, who is the vice-president of research partnerships programs directorate.

It is my understanding there are also two alternates who may possibly be called but who aren't seated in front of us. They are, from the Natural Sciences and Engineering Research Council, Isabelle Blain, the vice-president of research grants and scholarships, and Kevin Goheen, executive director of the Canadian Academy of Engineering.

I will follow the order on our agenda here. I believe everybody has opening remarks of five minutes or less.

Ms. Carter, would you begin, please?

[Marie Carter, Chief Operating Officer, Engineers Canada]

Thank you very much. Mr. Chair, I am very happy to have the opportunity to appear before you today.

As mentioned, my name is Marie Carter. I am the chief operating officer of Engineers Canada. We're the national body that represents the 12 provincial and territorial regulators of the engineering profession. Our regulators license over 250,000 professional engineers in all disciplines across the country. The regulators' role is public safety. Their role is to ensure that licensed engineers are held to the highest standards of engineering education, professional qualifications, and professional practice.

I'd like to start today by speaking about how Engineers Canada impacts engineering in Canada and about our role and that of federal policy-makers in addressing the challenges we anticipate.

It takes a team effort to get the right engineer in the right place at the right time. Engineers Canada's members and volunteers, the regulators and our volunteers, are committed to making sure there's consistent engineering education across Canada. We already have 271 accredited undergraduate engineering programs in the country at this time. We monitor and recognize international engineering degree programs as well. We're the keepers of several mutual recognition agreements with other countries.

Through our qualifications board, we bring together engineering regulators to work toward consistency on admissions to the profession, continuing professional development requirements for our engineers, engineering-in-training programs and student affairs, sustainability and environmental affairs, professional standards, and discipline and enforcement.

Engineers Canada publishes national guidelines and model guides for practice. We maintain a national examination syllabus, which is used by our regulators to assess academic qualifications of immigrant engineers. We do a lot of research. We investigate emerging engineering areas and emerging practices that are going on worldwide.

I'd like to address the state of engineering in Canada and the policy problems we expect to face.

We know that our engineers are well recognized as experts, leaders, and innovators, and our talented professionals have an important role to play in protecting the public.

As the need for the contributions of engineers to society grows, one of our biggest policy challenges will be how to respond to the looming engineering skills shortage.

We recently released a labour market study, and in that study you'll see that in most jurisdictions across the country there will be shortages of engineers with five to 10 years of experience or specialized skills, while new graduates from engineering programs may have difficulty finding jobs.

We are anticipating a high number of retirements, as we know from the demographics in Canada. Engineering is no different. By 2020 we should see approximately 95,000 engineers either fully or partially retiring.

Today we've got approximately 60,000 undergraduate students in accredited programs across the country. They'll help the shortage somewhat. Combined with an estimated 16,000 new engineering jobs, recruiting into the profession is going to require some focused attention by the regulators, employers, academia, and governments.

Engineers Canada and the provincial and territorial regulators are working together to address the labour shortage as well as we can by promoting diversity in the profession. Therefore, we have a focus at the moment on attracting what we see as the untapped resources in Canada for engineering, those being women and indigenous people.

If we go back to the 2006 census, the most recent information available to us, women comprised 47% of the total workforce but only 13% of the engineering workforce, which is a significant increase from 20 years prior. The rate of engagement by indigenous people is also very low. We're approaching these two groups of people differently because the issues in trying to attract them into engineering are different.

We're also coordinating with federal government efforts to streamline the immigration system. At the moment, more than one in five professional engineers in Canada came from offshore and is an immigrant to this country. We've got quite a substantial number of immigrant engineers working in Canada and licensed in Canada.

Annually our regulators process about 5,500 applications from immigrants. We know that is about the highest in the regulated professions. We are looking at working with the streamlined efforts that are going on with the federal government. We have our regulators on board with us to help with that effort.

Everybody here at the table today works together on a fairly regular basis, so I'm going to leave it to my colleagues to address the question of whether or not we're globally competitive and where those opportunities and growth might be.

In closing, I would like to stress that I think we should all be proud of the engineers in the country who do so much to keep our communities safe, support and contribute to our economic prosperity, and drive innovation in the country. I look forward to continuing working with our federal government to support growth in this area.

[The Chair, Conservative, David Sweet]

Thank you, Ms. Carter.

Now we go on to Mr. Laguë.

[Dr. Claude Laguë, Dean and Professor, Faculty of Engineering, University of Ottawa, As an Individual]

Good afternoon. My name is Claude Laguë. I am the dean of the faculty of engineering at the University of Ottawa, but I am also the current chair of the Council of Ontario Deans of Engineering and past chair of the National Council of Deans of Engineering and Applied Science.

I will be able to answer your questions with regard to our particular situation at the University of Ottawa. I also have a fairly good understanding of what is happening elsewhere in the country.

There are more than 45 engineering schools in our country. Just to give you a few numbers, that means about 90,000 students who are enrolled in undergraduate and graduate programs of studies. We typically deliver about 15,000 to 16,000 degrees in engineering at the undergraduate, master's, and Ph.D. levels collectively.

Our mission is a dual one. Of course, we have the mission of educating future engineers, those who will practise engineering in Canada as well as in other countries in the future. Also, at the advanced level, we educate the people who are going to be the future experts and researchers in the different engineering disciplines.

We also have, as part of our mission, a very strong emphasis on research and development, so we are advancing knowledge related to engineering in all the different disciplines that we cover.

All in all, in terms of people who are engaged in those activities in engineering, about 7,500 people—professors and employees—are delivering this education and fulfilling this research agenda across our country.

I'm happy to answer any questions you may have on these issues related to engineering education and research when we get there.

[The Chair, Conservative, David Sweet]

Go ahead, Mr. Gamble.

[John Gamble, President, Association of Consulting Engineering Companies - Canada]

Thank you for the opportunity to appear before the committee. I was thinking I don't get to see my colleagues nearly enough, so thank you for that opportunity.

Our association represents about 500 private sector companies that provide independent consulting engineering services to a wide range of both private and public sector clients. Their services include the planning, design, and execution of all types of engineering projects, as well as providing independent advice and expertise in a wide range of engineering and scientifically related fields.

In this position, our members have a direct impact on virtually every aspect of our economic, social, and environmental quality of life. At the end of the day our association exists to advocate for a business and regulatory climate that allows our members to be successful and also to offer the highest level of service and the highest possible value to our clients.

We are a federation of the 12 provincial and territorial associations. We're also a member of the International Federation of Consulting Engineers. If you would indulge me with a commercial, their executive committee will be meeting in Ottawa in May. We've been planning to have a reception on the Hill, and you're all invited, or will be.

We're a very influential voice in that organization. In fact, we're the fifth-largest exporter of engineering services in the world, and I think that's something. If there are two types of people who I find are insecure, they're Canadians and engineers, so it's pretty important for us to be number five in the world.

On the state of engineering today, StatsCan uses a category that's a little broader than just our consulting companies, but operating revenue from that whole category of all private sector engineering companies is about $22.5 billion. Our consulting engineering part of that is about two-thirds. The other part would be EPCM firms.

We have companies that build and set up equipment, but they're not really independent consulting services. For example, none of our members are mining companies, but they may consult or provide expertise to mining companies.

Our members directly employ about 75,000 across the country. Again, we're an association of companies, not engineers. Those 75,000 are engineers, land use planners, natural scientists, and administrative staff. More and more are multidisciplinary firms.

By the way, our industry, across the 500 firms, represents about 3,000 different offices around the country.

We've seen a lot of consolidation in our industry. It's certainly been very good since the recession of the 1990s. To give you an illustration of what we've been contending with, since 2002, roughly 10 years ago, the number of firms we represent has gone down by about 24%, and that's not because of economic viability; on the contrary, it's consolidation, driven by a number of factors, including opportunity. At the same time, while our number of firms has shrunk, the staff members our association represents has gone up by 90%. I think that's a pretty good success story for our industry.

Factors contributing to consolidation, of course, are a greater demand for one-stop shopping and multidisciplinary firms; certainly and particularly recently, a capacity for larger-scale and higher-risk projects; and succession planning.

The recession of the 1990s was catastrophic for our industry. The firm I worked for at the time went from 500 to 300 employees in a span of 18 months. We saw massive layoffs. We saw enrolment in engineering drop. We now have a demographic hole in our profession.

There was no stimulus program at the time. There was no major investment. We estimate that fewer than 10% of the practising engineers in our industry are between the ages of 41 and 50. These would be the people you'd be selling shares to. These would be the people you'd be asking to step into leadership roles. That lack of succession or availability of successors in companies has driven a bit of the consolidation in the industry.

With regard to our market sectors, the municipal and government sector and the public sector in general were extremely busy heading into the last recession, but we managed to continue to grow through that. Some of the credit certainly goes to the stimulus program, which, while not a perfect program, we certainly view as a largely successful and worthwhile program. I think there were a lot of valuable lessons from it.

We are cautiously optimistic that a long-term infrastructure investment program will come, hopefully, in the near future.

The resource sector remains very strong. It's offset some of the softness in the industrial and commercial sector, and traditionally tends to be our strongest export sector. As most people are aware, the industrial and commercial sector was probably the most severely impacted during the recession. This certainly caused some displacement. It wasn't all good during that period.

Some jobs were lost, but there was net growth and some displacement within the industry. We thinks it's starting to come back, but of course, like you, we're all watching the world markets. We're all looking at what's going to unfold in the years ahead.

I mentioned that globally we're recognized as the fifth-largest exporter. Our engineering education in Canada is uniformly excellent. Our regulatory system is very good. We have strong capabilities in virtually every sector.

Since I'm getting into the notes, I can certainly address some of the specific policy problems during the question period.

[The Chair, Conservative, David Sweet]

Thank you, Mr. Gamble.

Monsieur Marceau is next.

[Dr. Richard Marceau, President, Canadian Academy of Engineering]

Thank you very much, Mr. Chair.

I would like to begin by thanking the Standing Committee on Industry, Science and Technology for the opportunity to speak on behalf of the Canadian Academy of Engineering on the state of engineering in Canada today.

The Canadian Academy of Engineering is the national institution through which Canada's most distinguished, experienced, and accomplished engineers provide strategic advice on matters of critical importance to the nation. Though a number of issues will merit your close consideration today, our brief introductory remarks will focus on three keys ideas: the high quality but insufficient number of Canadian engineers, the urgent need for adequate succession planning for Canada's next generation of engineers, and the importance of engineering input in Canada's economy and in creating policy.

On the first point, Canada has the enviable reputation of having one of the finest engineering education systems in the world, as our colleagues have already mentioned. It is characterized, however, by a unique combination of provincial jurisdiction over the institutions that provide the education, provincial jurisdiction of the engineering profession itself, and compliance to high standards of excellence set by a national organization, the Canadian Engineering Accreditation Board, which regulates the accreditation of all faculties and programs.

For engineering graduates to be admitted to the profession without taking exams, all engineering programs, regardless of province or size, must meet the same high standards of excellence set by this board. As a result, Canadian engineers are recognized internationally for their excellence in many fields. I'll name just a few: aerospace, automotive parts, electric power transmission, hydroelectric power generation, nuclear power generation, information and communications, resource extraction, satellites, simulation and virtual environments, and many, many more.

Unfortunately, Canada has among the lowest numbers of engineers per capita of the OECD nations, a fact that creates uncertainty around Canada's capacity to do five things: maintain its present infrastructure, build new infrastructure, meet the needs of growing and emerging industries, develop new applications and products, and stimulate innovation and entrepreneurship.

Let us now turn to the issue of succession planning.

Canada is faced with a generational problem. That too has been highlighted by my colleagues here today. At least a quarter of all Canadian engineers could retire within the next 10 years, at a time when an expansion of the engineering pool is absolutely essential. Simultaneously, Canada is challenged to maintain its present supply.

Historically, the gap between supply and demand has been filled by immigration. Unfortunately, as we look towards the future, this is no longer an option. China and India now wish to keep their engineers for their own nation-building. Those still open to immigration are now aggressively courted by Scandinavia, Europe, and even Japan, countries that traditionally have not had to do so.

The same is true for the university professors who will educate the next generation of engineers. Canada will need to step up efforts to graduate professors from among its own young people, rather than relying on immigration. Canada needs to significantly stimulate its ability to graduate far more engineers at the bachelor, master's, and doctoral levels, especially women engineers and first nations engineers.

Let us now briefly address the third issue, that of the impact of engineers on Canada and policy.

Canada's industry competes in a world economy, and access to engineering talent is a key competitive advantage underlying Canada's capacity not only to maintain but to grow its wealth-generating environment, either through U.S.-style innovation or through Canada's historically successful big-project innovation strategy.

Also, for nations to be competitive, they need enlightened policy. In a world dominated by rapidly changing technology trends, understanding the deeper meaning of these trends is key to a nation's competitive position. The need for engineering input in formulating national policy has never been as important as it is today.

In conclusion, access to a pool of engineers of adequate breadth and quantity is key to the sustainable social and economic development of any modern nation.

The Canadian Academy of Engineering recommends that the federal government provide leadership in creating a joint federal-provincial partnership for greatly accelerating our nation's capacity to develop human capital in all fields of engineering. The academy also recommends that representatives from industry, universities, and the profession be called upon to provide advice on how best to achieve the needed gains in graduation rates at all levels.

Again, thank you very much for your kind attention and for the opportunity to appear before you today.

[The Chair, Conservative, David Sweet]

Thank you, Mr. Marceau.

Go ahead, Madam Walden, please.

[Janet Walden, Vice-President, Research Partnerships Programs Directorate, Natural Sciences and Engineering Research Council of Canada]

Thank you, Mr. Chair, for inviting me to talk about the Natural Sciences and Engineering Research Council's role in addressing the shared challenges that impact engineering in Canada.

NSERC is the national funding agency responsible for advancing post-secondary research and training in the sciences and engineering. Our investments in people, discovery, and innovation have had, and continue to have, a profound impact on Canada's ability to remain competitive in today's global engineering environment.

With an investment of $1 billion, NSERC gives 41,000 fellows and seasoned researchers at universities and colleges across the country the opportunity to pursue the promising ideas and innovations that will give Canada a competitive edge in the 21st century.

That support includes major investments in a number of engineering fields, including the telecommunications, aerospace, automobile, construction and mining sectors.

In 2011-12, NSERC's investment in these engineering-intensive sectors was more than $320 million, approximately one-third of our total budget. This investment enabled 13,000 students and experienced researchers at universities and colleges across the country to pursue ideas and innovations.

We see solving practical problems as an integral part of engineering. NSERC is a leader in providing opportunities for industry to access the wealth of engineering knowledge and skills available in our post-secondary institutions. This access increases our productivity and the global competitiveness of our industries.

These relationships, however, also benefit our researchers, who are inspired to work on new industry-relevant research, and our students, who gain valuable industry-relevant experience and training. In fact, 55% of all NSERC investments in industry partnerships are in engineering-related fields. For example, Alberta's leading university experts in oil sands maintain very active partnerships with this crucial industry sector through NSERC support.

We leverage the unique strengths, insights, and capabilities in both academia and industry, and these collaborations involve more than 30 companies in the oil sands area and cover virtually every facet of the industry's development, from mining through to their land reclamation. They've contributed new technologies that make the industry's processes more efficient and cost effective and reduce the environmental footprint. Perhaps more importantly, they've contributed many of the engineers employed today by these companies.

Going forward, we need to really ensure that we have a sufficient pipeline of talent—I think you've heard this as a uniform message here—and that this talent has the right skills. We've heard clearly that attracting more women to engineering continues to be a challenge. The share of female enrolment in engineering in Canada has held steady over the past 10 years; however, we are very far from parity. Through policies and programs, NSERC is looking for novel ways to increase the participation of women in engineering. One example is our women in science and engineering chairs program, which provides a mentorship component.

As we've heard, Canada relies heavily on international students. In fact, these students account for 40% of university enrolment in engineering in Canada at the graduate level. We firmly believe that this is a feather in the cap of our excellent Canadian engineering schools; however, we can't rest on our laurels. We must continue to be competitive to attract and retain top engineering talent from all over the world. This is a growing challenge.

Jayson Myers, the president and CEO of Canadian Manufacturers and Exporters, noted very recently that in today's global markets Canadian product manufacturers can't compete on existing technology alone, so design has become the ultimate means of differentiation. Since 1999, NSERC has worked with the engineering community to strengthen training in design in our engineering schools through a series of chairs in design engineering. This is an ongoing and shared challenge with stakeholders such as the universities, and it is a nut that's not yet cracked.

Building our human capital in science and engineering through advanced training is an integral part of all NSERC programs. In 2011-2012 we worked with over 2,400 different industry partners. These partners have helped to provide students with valuable work experience and professional skills. In many instances, they hire these students after they graduate, contributing to our retention.

In conclusion, I want to reiterate that NSERC plays a vital role in ensuring that engineering in Canada remains globally competitive through our investments in people, discovery, and innovation, and by connecting this capacity to the needs of our industry.

Thank you.

[The Chair, Conservative, David Sweet]

Thank you very much to the witnesses for your opening remarks.

We will now go to our rotation of questions. The first one up is Mr. McColeman, for seven minutes.

[Phil McColeman, Conservative, Brant, ON]

Thank you, Chair.

Thank you, witnesses, for being here today and for explaining each of your unique areas involved with leadership positions in engineering.

I want to go down the line of the gap that exists, the generational gap that was mentioned—I think it was ages 41 to 50—to see how companies and engineering firms are coping with it. What's happening? Is it the quicker advancement of the most talented people below into the senior management positions at a much earlier age than traditionally, or are there any other facets to that?

I invite everyone to speak to this if they wish to, maybe starting with Mr. Gamble, who represents the independent entrepreneurs.

[John Gamble]

It is a concern. One of the solutions has been to seek amalgamation with other people with deep pockets. The firms are doing extremely well, so the value of the shares, even of employee-owned firms, would be quite great, but there are very few people to sell them to.

You're quite right. A little bit of it is that we're asking some of the leaders in our industry to grow up a little faster and to step into those leadership roles.

Again, as another compliment to the education system, I find that some of the younger engineering graduates have tools that I could not have dreamt of when I went to university. I think they are probably better equipped to step into these roles than I was at a similar age. That's part of it, but it really still becomes a workload issue.

I have also observed that people are working harder and longer to make up the time to bring projects in on budget.

The automation and technology that are available to us to do projects faster are—I'm trying to find the right word—not giving us the leisure society people were promised when I was a kid, but they're still allowing us to deliver the goods as we need to, so that's part of it as well.

Immigration is part of it. The challenge is to get the right people in terms of the discipline, the training, and the appropriate background, and also to get people to step into leadership roles in firms. Often when you're promoting from within, you're looking at people who have relationships with your key clients, people you have watched over many years demonstrating leadership skills. You're watching people who understand provincial codes, provincial laws, and things of that nature. It's a challenge. Frankly, I would suggest that we need to avoid a similar situation so that we don't end up in this position 20 years from now.

I'd like to put in a little plug for a long-term infrastructure investment program. That is critical for us to build our industry, because when you hire a new employee, whether they're 25 or 55, it's usually a year or two before they become productive. It's an investment to hire someone. You take them on; you have contractual obligations if they don't work out, so you have to factor those in, but you have to train them. You have to bring them on board. You have to make that long-term investment in them. It's very difficult to do when you're funding comes from infrastructure programs that run for a couple of years and stop for a couple of years. Building Canada was quite refreshing because it lasted about seven years—not long enough, in my opinion, but that's centuries long in governmentspeak. That would certainly help us build capacity in the industry.

[Dr. Richard Marceau]

I fully agree with everything that my colleague has said. I'd simply like to give you a very specific example in the university area in one particular field of engineering, which is electric power engineering.

The reality is that there are not enough professors today in Ontario or most of the rest of Canada, except for Quebec, to graduate the electric power engineers that are direly needed in the electricity sector in Ontario and the rest of Canada. There is actually a crisis right now regarding the number of people we can find to do electric power engineering for the electricity sector.

How do we cope with it? It takes more time to get people. There are things that don't get done. There are projects that get pushed out. If you're building a switching station or a transformer station, for instance, and you don't have the right people, either you're going to pay too much for the transformer or you're going to get an inadequately designed station that will reach its capacity far before the time that you would like it to, far before the normal lifespan if you had the right expert working on it.

That is what is going to happen. It's already begun.

[Phil McColeman, Conservative, Brant, ON]

Ms. Carter, on the international question, are we bleeding engineers to other countries? Are those who are being educated here moving into positions outside the country?

[Marie Carter]

They are to some degree, but it's not the same sort of situation that we've heard with doctors and people in the health industry.

Certainly in Canada we have enough employers working internationally to permit people who want to have international experience to get that international experience without actually jumping ship to another country. I don't think that's an issue for us.

One of the issues that I see coming forward is a lack of mentors. As we move through and see our more senior engineers starting to retire, those ones we've backfilled the gap with, the 30- or 40-year-olds, are not going to have the mentorship or are not going to be mentors for the younger crop coming out.

The business culture in Canada is the key element that we have seen as problematic with immigrant engineers. It just takes those from our main source countries for immigrant engineers a little bit longer to truly understand the cultural aspect of business. I think that may be a bigger issue than losing Canadian engineers.

[Phil McColeman, Conservative, Brant, ON]

I have one last quick question.

Mr. Laguë, is the elementary education in our secondary schools producing graduates who have the skill set to go into engineering at the post-secondary level?

[The Chair, Conservative, David Sweet]

I'm sorry, but the time has run out. If you hold onto that, somebody may give you the opportunity to answer. Time is one thing we always have to bear in mind here.

Go ahead, Mr. Stewart, for seven minutes.

[Kennedy Stewart, NDP, Burnaby—Douglas, BC]

Thank you, and I thank the witnesses for coming.

About a year ago I took over from Madame LeBlanc as the science and technology critic. I have heard a lot from scientists and a lot from technologists, but I was very keen to hear more from engineers. Thanks very much for coming today.

Really, what I was interested in is what you've been telling us: the state of engineering. Being trained in policy, what I'm interested in are problems and solutions. It seems the overwhelming problem that you've been highlighting here is skills shortages, but there seems to be a subset of problems in there.

All of you could answer. Would the skill shortage be the main problem, or are there other problems that we could perhaps discuss here today?

[John Gamble]

There are others.

One of the challenges we have is that Canadian engineering, when we export, is quite excellent, of high quality, and very expert, but we're not cheap. Part of that is because of the standard of living we have and what we invest in putting in good people. I do believe we deliver very good value.

The solutions are excellent. They provide long-term value. Your invoices might be a little bit higher, but the innovation allows you to reduce the capital investment, which is usually 10 times more than what you pay in engineering and design. In fact, engineering is typically less than 2%, and often less than 1%, of the overall life cycle of a project.

Clients who understand that it is a good investment like Canadian engineers. Largely these would be private companies. As government, you have the challenges of your annual budget and all the process to ensure transparency, whereas a mining company or a steel mill or anyone else bringing in an engineering consultant can say, “We like what you do. You did a great job last time. Get working on the next project and send us an invoice.” This is because they see value. That is very difficult, I understand, in the public sector.

If we get into public clients overseas, it's a little more challenging. Frankly, we are more expensive on an hour-per-hour, day-per-day basis, but again we hope that people look at it in terms of the overall value and the overall success of the project.

[Kennedy Stewart, NDP, Burnaby—Douglas, BC]

Just before you leave that, what could we do to help you there?

[John Gamble]

We were certainly pleased that there's going to be more opportunity, again through international development, for private sector participation. I think there's a lot we can do to augment the good work the NGOs do.

In years past, it was actually what gave us some exposure in foreign jurisdictions and allowed us to really strut our stuff, show innovation, and show value. Doing international development is not profitable, but it does help you build reputation and build credibility, and it looks as though that door might be opening a little bit more than in the recent past. That's certainly constructive.

[Kennedy Stewart, NDP, Burnaby—Douglas, BC]

I'm sorry to be rude. I just have my seven minutes, and I was wondering if I could spread it across the table—

[John Gamble]

Yes.

[Kennedy Stewart, NDP, Burnaby—Douglas, BC]

—and perhaps hear from others. Thank you for that.

Just hearing about problems and solutions would be excellent.