Finance Committee on March 6th, 2014

[Angella MacEwen]

No.

[Dave Van Kesteren, Conservative, Chatham-Kent—Essex, ON]

Where we can collectively—

[Angella MacEwen]

No. It's a terrible strategy.

[Dave Van Kesteren, Conservative, Chatham-Kent—Essex, ON]

You don't think it's a good idea for employers—

[Angella MacEwen]

The way the Canada job grant is structured—

[Dave Van Kesteren, Conservative, Chatham-Kent—Essex, ON]

Okay. You don't think so.

Go ahead, Mr. Atherton.

[John Atherton]

I think it's important to know that the Canada job grant is for all Canadians. It's not only for the employees of a particular business. It's designed for anybody to get either a better job or a new job.

I think that the challenge—and it's a great challenge for the country—will be having employers much more engaged with provinces and service delivery providers in connecting directly with the people who don't have jobs and training them.

Is this a good thing? Most people, I think, want to know definitively that what they're training for would result in an outcome.

Are we perfect? Can this improve it? We're one of the first countries in the world trying to really reach in. I think it's something that we're going to be working on. We've got many provincial partners with us, and they'll be all experimenting using some different approaches.

[The Vice-Chair, NDP, Peggy Nash]

Thank you, Mr. Atherton.

Thank you, Mr. Van Kesteren. I know; it goes so quickly.

Mr. Leung, you have five minutes, please.

[Chungsen Leung, Conservative, Willowdale, ON]

Thank you, Madam Chair.

I wish to follow on my colleague Mr. Van Kesteren's line of thinking. To me, job creation and job matching are somehow separated in our economy. We train a lot of people and then we say they're on their own to go look for a job or the government can put its resources into job training and job creation.

I also bring this back to other issues. We train a lot of very highly educated kids and what they end up doing is going to Japan, Korea, China to teach English. I often question the merit of this. Yes, it's broadening their experience, but when they come back they're still in the same hopper of saying, “How do I train myself for a proper job?”

Mr. Atherton or Mr. McGovern, perhaps you can shed some light on where government resources are best employed. Is it in the job matching aspect or in the job training aspect once it's matched? And what are the priorities in how we do that?

[David McGovern]

I want to touch on a point that I wasn't able to make earlier. Canada has one of the highest rates of post-secondary education attainment in the world. That's a good thing, that's actually a very positive thing. And we know that university graduates earn on average twice that of a high school graduate. We also know that employment rates tend to improve for youth as their level of education rises, particularly with post-secondary education attainment. We also know within our society that the full-time labour market participation of youth is peaking in 2012 at 29 years of age, compared to 23 years of age in 1976. So youth are delaying transitions that took place earlier when you go back to the last century. But that's also associated with the fact that youth are spending more time in school and they're delaying their entry into the labour market.

One of the points I was talking about before is that we're now trying to find that matching where we have youth who have skills but they don't have jobs. One of the things I talked about before is we have a number of different tools we use within our department and within the Government of Canada. We have the Working in Canada website; we have the Job Bank, where we provide a platform for employers to post job opportunities and job seekers and students to see available positions; we have another platform called youth.gc.ca that's specifically targeted at students, at a younger cohort of youth, where we give them information about planning for their post-secondary education. We also have Job Alerts where we're really trying to be more proactive in matching available jobs with people who are looking for jobs. We also have a website called CanLearn, where we provide information to students about the best way to save, to plan, and to pay for their education. One of the things we haven't touched on today are the supports our department provides to Canadian youth and to families with respect to making education available.

[Chungsen Leung, Conservative, Willowdale, ON]

These are all pretty passive forms.

Can we focus a little bit more on the active side? How do we actually go out and reach out and say, “We need you for this job?”

[John Atherton]

In short, the committee and this study that you're doing are so important in today's age. As a person who runs employment programs, I am often dealing with a semi-finished product or a person who's already made many learning choices in their life. And reaching into the system and having young people make different or smarter learning choices or learning choices that are more aligned with current labour market demand is in fact one of the greatest challenges in a fast-moving economy. It's difficult. Imagine making a decision today and the product might not be available for the job for four or five years.

When we had the issue, and we still have an issue in apprenticeships and skilled trades.... So models to look at are models like Skills Canada. I encourage you to talk to Skills Canada as a model of bringing more than 100,000 Canadians together as volunteers, teachers, educators, parents, professionals in the industry, around skills competitions to introduce young people to jobs and opportunities they might not have had otherwise as a way of changing culture and opening eyes. These types of active, hands-on engagement are the some of the things that budget 2014 signalled in the government's new approach. We are realigning our spending to do more of this kind of work, this active, hands-on engagement of young people.

[The Vice-Chair, NDP, Peggy Nash]

Thank you, Mr. Atherton.

Thank you, Mr. Leung.

We're at the end of a round of questioning, so as chair I'm going to take a few minutes to ask a question.

My question is for both Ms. Josephs and Ms. Huziak. You both mentioned the issue of wage scarring. Can you define what wage scarring is and describe more fully how that is taking place, in your view, with young people in Canada today?

[Amy Huziak]

I'll go first. I don't know if wage scarring is an official term.... Oh, okay. I've been told: it's an official term.

Basically what it means is that when young people experience a period of unemployment or underemployment, that puts them behind their peers who had steady employment at the time. That means it's harder for young people to catch up and, in some cases, impossible. I think I said earlier that often the effects can be felt for up to 20 years or longer.

It clearly is a problem for young people, but not just for young people. I think it's a problem for everyone. The intergenerational effects of wage scarring and income inequality are being felt by parents, by older workers, and by workers who want to retire but can't because they are still putting their kids through school, for example, or still paying for their kids to live at home while they go to school, or who are unable to sell their houses. There may be a lot of older workers who have invested in their house as their retirement plan, but there are no young people to buy the houses because young workers have fallen so much farther behind.

This is not just a problem for young people. Although it directly affects young people, it affects everyone, really, and it really needs to be addressed.

[The Vice-Chair, NDP, Peggy Nash]

Anecdotally I hear that a lot, not just from young people, but from their parents and grandparents, who are concerned about them not being able to get a start.

Ms. Josephs, you mentioned this as well. Is it something that you see affecting young entrepreneurs? Do you see more people starting further behind and not being able to start businesses because of this wage scarring? What is the aspect that you see in the young people you deal with?

[Marsha Josephs]

This is a challenge for young people. The way we come at it and where we see the issue being most prevalent is around succession planning. We know that many older business owners are nearing retirement and are looking for individuals to take over their businesses. Young people are well positioned to do that.

For example, we know of a young entrepreneur named Barb. She cleans airplanes for a living. She worked for the retiring entrepreneur and was a fantastic employee. The entrepreneur approached her and asked her to take over the business, but she had no money and no collateral. No one would loan her the money. She came to CYBF. We loaned her $10,000. This was enough for her to leverage to get more people on board and to give her some dollars to get started.

Now she is in Calgary, Edmonton, and Vancouver and is looking to expand. She has a workforce of 36 employees. This is a young entrepreneur who is achieving her dreams and has used our succession program to help her do it.

[The Vice-Chair, NDP, Peggy Nash]

Thanks very much. I heard her speak here in Ottawa last year.

We'll start a new round of questioning as we've exhausted our list.

We'll begin with Mr. Rankin.

[Murray Rankin, NDP, Victoria, BC]

Thank you, Chair.

I want to ask a couple of questions of Stats Canada.

Unpaid internships are a big issue. Does Stats Canada count full-time unpaid interns as unemployed? Probably not, because they're not looking for work, but on the other hand, they're not bringing in a paycheque. When you do your labour market survey, how do you treat the unpaid interns?

[Alison Hale]

We follow the international definition of work, and it's basically “work for pay or profit”. That was discussed recently at the International Labour Organization—what to do with those—but it's not considered to be working, so it depends on the—

[Murray Rankin, NDP, Victoria, BC]

Are they called unemployed?

[Alison Hale]

It depends on their other characteristics, if they are looking for work or not.

[Murray Rankin, NDP, Victoria, BC]

How many interns are there in Canada? Do you have data on that?

[Alison Hale]

We don't have that.

[Murray Rankin, NDP, Victoria, BC]

I want to ask about pages 4 and 5 of your slides, which were very helpful. Thank you for them.

Page 4 talks about the longer duration of unemployed youth. Interestingly, the duration of unemployment in 2013 is much greater than in 2007, correct? But your stats show youth unemployment has a shorter time, but I believe there's no reference to the suitability of the employment at issue.

In other words, could this not be masking people who have graduate degrees but are working as baristas in the service sector? There's no reference to the suitability of the employment here.

[René Morissette]

No, because these numbers focus on people who don't have a job, and so these numbers answer the questions for those people who don't have a job about how much time they spent being unemployed.