Good morning. Thank you for the opportunity to be here today.
You should have our presentation in front of you that I'd like to walk you through in the next few minutes.
As many members know, CFIB is a not-for-profit, non-partisan organization that represents more than 110,000 small and medium-sized businesses across Canada. Our members collectively employ more than 1.25 million Canadians and contribute nearly $75 billion or nearly half of Canada's GDP. They represent all sectors of the economy and are found in every region of the country.
As you may be aware, CFIB takes its direction solely from our members through a variety of surveys, which makes us a bit different from other organizations. The data I am sharing with you today is sourced from Statistics Canada, public opinion polling and our own survey on the changing world of work, which had nearly 7,000 respondents in 2017.
I'd like to provide a bit of context before getting into the details of our presentation.
As you can see on slide 2, job vacancy rates are currently at a nearly all-time high, with approximately 409,000 jobs currently unfilled. These vacancies are highest in the construction industry and for personal services—plumbers, mechanics, electricians, hair dressers, you name it. Arguably, this could be creating the best conditions for workers seeking employment.
We know the committee is here to study the notion of precarious work. This can be defined in a number of ways as I'm sure you've heard and will hear, but I'd like to start by challenging the myth that permanent jobs are on the decline.
If you look at slide 3, you'll see that job permanence over the last 18 years has remained virtually unchanged. This StatsCan data shows that 86% of jobs in the economy were permanent in 2018, down slightly from 87.5% that were permanent in the year 2000. The decrease was primarily felt during the 2008-09 recession and the proportion has been stable since then.
There was an increase in term contract work, from 5.8% to 7.1% of the workforce, but part of the increase was offset by reductions in seasonal and casual work. The overall trend of permanent to temporary work during the past 18 years has been kept to an increase of only 0.8% of the workforce, equivalent to about 125,000 jobs of the 15.8 million available in the economy.
Another myth—the notion that precarious work is largely found in the private sector—is disputed by the StatsCan data available to you on slide 4. In fact, most short-term or contract jobs tend to be found in the public sector, as you can see.
Considering, again, data from StatsCan, on slide 5 you'll see that of those individuals who are working part time, the vast majority do so due to personal preference or because they're studying and not because they are forced into it. It was particularly compelling for me to note that while we know there are workers out there who would prefer a full-time job but cannot find one in their chosen profession and so create one out of part-time jobs or contracts, first, this is in fact decreasing, as the data shows if you look at the figures from 1997 compared to now. Second, any recommendations this committee makes should be sure to address this relatively small proportion of workers and not disrupt employment status chosen by students and individuals out of personal preference.
As part of our research into this issue, we conducted a public opinion poll that demonstrated that generally workers are satisfied with their work arrangement. Importantly, as we see on slide 6, 83% of independent contractors in particular are satisfied with their work arrangements.
What is the experience of small business owners? As you can see on slide 7, the vast majority, or 94% of our members, hire permanent employees. This data is from a survey we conducted in 2017 with nearly 7,000 responses. Some members also use temporary employees and just over a quarter use independent contractors.
As you can see on slide 8, in a small business, part-time work often leads to full-time work in nearly half, or 43%, of instances.
When we polled small business owners as to their reasons for hiring independent contractors, as you can see on slide 9, they identify issues such as making it easier to adapt to changes in demand. It gives them access to greater expertise and competency and increases the flexibility of their organization. These are really important measures in a time of a changing and nimble economy. Forty-five per cent of small business owners note that it is the worker's preference to be an independent contractor and cite the red tape involved in hiring employees as a barrier to doing so.
Similarly, when we asked small business owners to share with us why they hire temporary employees, over two-thirds said they did so to help them adjust with changes in demands and as a result of a shortage of qualified labour. In some instances, they simply cannot find someone to work full time. Again, a quarter of small business owners noted that it is the employee's choice in some instances to be a temporary worker. This may be particularly true in situations where the worker is an artist or has another passion project they work on and they use temporary or part-time jobs to keep them afloat in between projects.
The last important piece I'd like to share with the committee today is that many small businesses use temporary employees as a starting point into creating a role for them as a permanent employee. As you can see on slide 11, 43% of small businesses are likely to convert a temporary employee into a permanent one.
In conclusion, we would offer the following recommendations to this committee:
First, support regulations that give flexibility to both employers and employees.
Second, reduce red tape associated with hiring and training employees.
Third, recognize part-time and temporary contracts as a first step toward full-time employment.
Fourth, recognize intention between contractors and employers. This is often a subject on which we get a lot of calls at CFIB. CRA is now coming in and evaluating whether the intention of the parties has made them employers and contractors or employees and employers. It is creating tension, and in some instances, it is costing our members tens of thousands of dollars as they fight this project through the courts.
Fifth, adapt to the changing world of work. Governments cannot regulate the new economy in the same way as they did the old.
Last, as we heard today, help self-employed workers. EI, taxation and a number of other rules need to adapt.
Thank you for the opportunity to be here today. I look forward to your questions.
Let me point out that I can also answer your questions in French, if necessary.