Human Resources Committee on April 4th, 2022

[The Chair, Liberal, Bobby Morrissey]

MP Van Bynen, you have a little over a minute.

[Tony Van Bynen, Liberal, Newmarket—Aurora, ON]

Thank you, Mr. Chair.

First of all, thank you to the witnesses for coming here and sharing your perspectives with this committee.

Our government created the union training and innovation program, UTIP, which was referenced earlier. I'd be interested in knowing what the positive impacts of UTIP have been to date. What are the ways that the federal government can improve and support the needs of your sector?

[Sean Strickland]

Mark, do you want to talk about UTIP and its impact in Hamilton?

[Mark Ellerker]

Absolutely.

The Canadian Building Trades Unions, even at the local level, is one of the largest private trainers. I think the only one larger than us is the Canadian military.

When we take a look at the local level, that influx of grants and tax monies that come in from the government through UTIP is substantial. We have individuals, such as the Millwrights Union Local 1916. They put in a total [Technical difficulty—Editor] system for the manufacturing and delivery of materials on conveyers. When we went to build the new Amazon facility in Hamilton, approximately 90% of the project was built by unions. That's a good example of where all of those millwrights who went onto that job site had to use new, advanced technologies. They had already got to play with it—plug and play—and use it in their training facility.

LiUNA Local 837 in Hamilton just built a 45,000-square foot training facility. When Sean talked about the number of people needed for employment, LiUNA, just in Hamilton with the LRT announcement.... Some other projects could use almost 1,000 or 2,000 local workers. That's just in the Hamilton area.

All of those training facilities tie into it. When we work with community benefits, colleges and high schools, there's a pathway. We definitely have to support apprenticeship pathways and make sure that we support employers that are supporting the apprenticeship best practices.

[The Chair, Liberal, Bobby Morrissey]

Thank you, Mr. Van Bynen.

I'm going to go to Madam Chabot for one question, and then Madam Zarrillo, to conclude the first group.

Madam Chabot, ask a short question, please.

[Louise Chabot, Bloc, Thérèse-De Blainville, QC]

Thank you, Mr. Chair.

Mr. Strickland, I have a question regarding your request for support for a skilled trades workforce mobility tax deduction. I want to make sure I understand that properly.

First, have you had positive responses? A budget is about to be tabled. Have you had any favourable feedback on that subject?

In what circumstances are we talking about mobility for which there would not otherwise be reimbursement by employers? I'm looking for some examples.

[Sean Strickland]

That's a great question. It's a very important issue to skilled trades workers across Canada.

We're not asking for any treatment different from what other workers have under the Income Tax Act. Right now, many workers are able to deduct travel costs, accommodation costs, [Technical difficulty—Editor] covered by their employer. We're asking for the same treatment.

That will help labour availability. Often, there are jobs within or outside of a province, or from a rural to an urban area. A worker could be collecting employment insurance; they don't want to incur the cost of travelling over 200 kilometres to go back and forth to work. It's more to their economic advantage to stay at home and collect EI. We think that by putting in this skilled trades workforce tax deduction, it will encourage labour mobility across the country.

That's something that needs to be addressed, as well: shortages and how we deal with them on a short-term and long-term basis, and labour availability and how we can move our labour pool across Canada. That's very important for construction workers.

[The Chair, Liberal, Bobby Morrissey]

Thank you, Mr. Strickland.

Now we go to Madame Zarrillo for the final question.

[Bonita Zarrillo, NDP, Port Moody—Coquitlam, BC]

Thank you, Mr. Chair. I will go back to Mr. Strickland, just on the retirees.

I did want to thank you, Mr. Ellerker, for the comments around hygiene. This is definitely something that's important. I would be interested in any occupational health and safety changes that the witnesses would recommend around this.

I want to share very quickly that my own father-in-law came here in the early 1960s, and was working on the railroads. They wouldn't let them wash their hands before they ate. When the new government changed, there were changes that happened on the railroads. They cleaned out the sleeping bunks for proper, clean hygiene in the sleeping bunks, and were able to wash hands before dinner. It made a huge difference. He still talks about it today.

Back to retirement, how do we support the knowledge transfer to keep workers longer and to get those new workers up and supported? That's to Mr. Strickland.

[The Chair, Liberal, Bobby Morrissey]

Thank you, Madame Zarrillo.

A short answer, please.

[Sean Strickland]

Keep investing in training and in bona fide training centres that offer true economic opportunities for skilled trades workers through recognized apprenticeship programs.

[The Chair, Liberal, Bobby Morrissey]

Thank you, and thank you to the witnesses for appearing this morning and answering detailed questions from the committee members. Your input is valuable in this study.

We will suspend for a few minutes while we transition to the next panel of witnesses.

[The Chair, Liberal, Bobby Morrissey]

I call the committee back to order.

I would like to welcome our witnesses for our second grouping to begin our discussion with five minutes of opening remarks, followed by questions.

From the Canadian Federation of Independent Business we have Jasmin Guénette. From the Comité sectoriel de main-d'oeuvre en aérospatiale we have Madame Martel, general manager. From École des métiers de l'aérospatiale we have Monsieur Éric Dionne, director.

We'll begin with Jasmin Guénette for five minutes.

[Jasmin Guénette, Vice-President, National Affairs, Canadian Federation of Independent Business]

Good afternoon, my name is Jasmin Guénette. I am the Vice-President, National Affairs, of the CFIB, the Canadian Federation of Independent Business.

I am going to make today's presentation in my mother tongue, French, but I will be able to answer some of the questions in English.

Before starting, I would like to thank the committee members for this invitation, of course.

The CFIB represents 95,000 small businesses in all regions of Canada and in all sectors of the economy. We are funded exclusively by our members. Our recommendations come out of the results of surveys of our members that we carry out regularly.

You have received a presentation on which I am basing my comments and recommendations today. If you have it with you, you can refer to page 2. Some small businesses are still experiencing hard times because of the pandemic. The various waves of full or partial closures have had a major impact on the viability of some businesses.

On page 3, I set out the data from a research report we published in December 2021 concerning labour shortages in Canadian small businesses.

As you see on page 4, 55 per cent of Canadian small businesses say they are affected by labour shortages. The 16 per cent of small businesses that say they are affected by the consequences of labour shortages have to be added to that. This might be, for example, a supplier that isn't able to deliver an order on time because of a shortage of employees. So the labour shortage is both a lack of staff for current operations and a lack of the staff needed to expand. On page 4, there is a breakdown by province and sector.

On page 5, it talks about wage increases as a miracle cure for labour shortage problems. Eighty-two per cent of small businesses have raised their employees' wages. Of the 82 per cent that have done so, 22 per cent say it was helpful and 47 per cent say it was not. Even if the business raises wages, that doesn't mean it will find all the applicants it needs or it can offer wages that meet the expectations of potential applicants.

Page 6 provides a list of solutions. The one with the highest success rate is automation. As you can see, 33 per cent of small businesses have tried this and 81 per cent of those say it was a success. It must be pointed out that automation isn't just buying expensive equipment; it's also automating certain internal processes, by purchasing software, for example.

The second solution that has the most success in filling vacant positions is hiring temporary foreign workers. The TFWP, the Temporary Foreign Worker Program, has been used by only 16 per cent of small businesses to date, but has a success rate of 52 per cent. That is why we are making a number of recommendations based on the results obtained from businesses themselves.

On page 7 of the presentation, the CFIB's recommendations include improving and simplifying the processes for the TFWP and the permanent immigration system to bring foreign workers to Canada faster.

We also recommend opening the TFWP to all types of jobs and all sectors, regardless of the prevailing regional unemployment rate, to address labour shortages caused by the pandemic.

In the announcement this morning, the government adopted a number of recommendations that we have made over time to help alleviate labour shortages.

The government also has to stimulate automation through programs or tax credits, since this solution has proved to produce results in small and medium-sized businesses, or SMEs.

It is also important to ensure that programs offered under the employment insurance scheme do not discourage returning to work.

You will find more recommendations on page 7 in the document we sent you.

I will be happy to answer your questions about our presentation, our recommendations, or other subjects relating to labour shortages in small businesses.

Thank you very much for your attention.

[The Chair, Liberal, Bobby Morrissey]

Thank you, Mr. Guénette.

We will move to Madam Martel.

I would remind the witnesses again it's five minutes for your presentation. I will stop you at that time.

Madam Martel.

[Andréane Martel, General Manager, Comité sectoriel de main-d'oeuvre en aérospatiale]

Good afternoon, everyone. Thank you for having us here today.

My name is Andréane Martel, and I am the General Manager of the CAMAQ, the Comité sectoriel de main-d'œuvre en aérospatiale.

The mission of the CAMAQ is to proactively ensure that workforce skills match human resources practices, for the present and future needs of businesses.

We support the dynamism and unique expertise of the workforce in the aeronautics and space manufacturing, air transport, aircraft maintenance, and airport sector industries. We have worked with the industry for 38 years to meet its workforce challenges.

Here are some broad figures about our industry.

In Quebec, there are over 300 large and small businesses in the aerospace sector. Montreal is the third largest city in the world when it comes to aerospace, after Toulouse and Seattle.

Our placement rate is 97 per cent. We represent 4,000 jobs in Quebec, where one worker in 113 works in the aerospace sector.

In 2020, the aerospace industry achieved sales of $15.8 billion in Quebec, and 70 per cent of Quebec manufacturing is delivered outside Canada.

Of course, we are here to talk to you about the labour shortage, a subject that has a huge effect on us. According to our annual censuses, businesses in the aerospace sector plan to create 6,000 additional jobs between 2021 and 2023. In 2031, given the positions that will be created and positions that will need to be filled, including retirements and career changes, we anticipate that over 30,000 positions will need to be filled in the aerospace sector.

Given the unemployment rate in Quebec, which was 4.9 per cent in February 2022, our pool of workers is very limited. In the fall of 2021, the number of vacant positions in the aerospace sector was 2,400, over 700 of which had been vacant for more than six months.

As well, 54.4 per cent of companies in the sector told us that the shortage will affect at least one position by 2023.

According to the companies in our sector, over 30 categories of professionals are experiencing or will experience a shortage by two years from now, both for low-specialization jobs and for highly specialized jobs. The categories most affected at present are CNC machinist programmers, conventional machinists, and aircraft maintenance technicians. We are also seeing an increase in needs in IT positions that affect digital transformation, artificial intelligence, and cybersecurity, for example.

The labour shortage is leading to raging competition to find talent and the effect on wages is that we are seeing wage bidding wars. As a result, a worker will move quickly from one employer to another, and this introduces an element of fragility into our entire sector.

In recent years, a number of factors have damaged our industry's reputation with the general public, particularly young people, and this will impinge on the attractiveness of the sector over the next few years. Examples are the announcements of layoffs in recent years, particularly on the part of the big clients, and the shutdown of virtually all airport and airline activities because of the pandemic, which seriously affected aeronautic and space manufacturing for several months.

The aerospace industry has access to leading edge training centres, but they are currently operating below capacity and having trouble recruiting students. Foreign students have to repay a significant amount and navigate administrative mazes to immigrate.

When our schools succeed in training foreign students, some of them move to Ontario once they complete their training, to get their Canadian citizenship faster. That situation seriously disadvantages Quebec, because we are not retaining the succession that we are training and we need.

Our sector is affected by a number of big issues. The shortage of specialized workers interferes with our companies' growth, causes them to lose contracts, hurts operations and innovation, and puts a brake on expanding imports. So the vitality of our businesses is seriously in issue. The lack of succession and the exacerbation of wage bidding wars may lead to subsidiaries of multinationals moving away, a loss of competitiveness as compared to other provinces and countries, and accelerated decline in the aerospace sector's presence on the world scene.

Here are a few possible approaches that could be considered.

Students from other Canadian provinces should be able to come to Quebec for training at a more reasonable cost. The federal Immigration Department should coordinate better with the Quebec ministère de l'Éducation and ministère de l'Enseignement supérieur to encourage recognition of diplomas and equivalencies, reduce processing times for applications from foreign students, and make sure foreign students are able to start their training on time.

As a final point, the federal government could give priority to processing immigration applications by candidates who already have a job offer in hand, and facilitate their integration into Quebec by making sure that the time for becoming a Canadian citizen is the same as in the other provinces.

Thank you.

[The Chair, Liberal, Bobby Morrissey]

Thank you, Ms. Martel.

Mr. Dionne, you have five minutes.

[Éric Dionne, Director, École des métiers de l'aérospatiale]

Good afternoon, everyone.

Allow me to introduce myself: my name is Éric Dionne, and I am the Director of the École des métiers de l'aérospatiale in Montreal, which belongs to the public school network of the Centre de services scolaire de Montréal.

The trade school, which is the size of two football fields, represents what working in a company is actually like, in all respects, including enforcement of the safety standards and rules in effect in the industry.

The key factors are really our skills and this precision. We have three annexes: one at Mirabel, another in Trois-Rivières, and a third in Quebec City. The mother house is in Montreal.

The school was founded in 1994 with the help of the CAMAQ, the Comité sectoriel de main-d'œuvre en aérospatiale, and four companies, which are clients: Bombardier, Pratt & Whitney, CAE and Bell.

[Terry Dowdall, Conservative, Simcoe—Grey, ON]

Excuse me. I am hearing both the French and the English at the same time.

It is fixed now; thank you.

[The Chair, Liberal, Bobby Morrissey]

Okay.

Please continue, Mr. Dionne.

[Éric Dionne]

We have five programs. Two of them are national and are offered only at our school: airframe assembly and mechanical assembly. These are courses lasting less than 1,185 hours, so they are relatively short training courses.

We also offer other training courses, such as cable and circuit assembly, machining, and precision sheet metal work. These training courses consist of a maximum of 1,800 hours.

We also offer training in areas such as tooling, machining on numerically controlled machine tools, operating numerically controlled machines, industrial painting, and interior installation.

As well, we offer an important service to assist businesses with customized training, proficiency tests, and documents, among other things.

For information, we also offer training in Ontario and in Alabama and Texas, in Querétaro, Mexico, and in a number of other parts of the world.

Working with businesses, we take part in workforce development, training skilled workers and maintaining their skills in the workplace, and training to motivate and retain employees and support organizational change.

CAMAQ validates our training courses every two years, to make sure they are properly connected with the work done in plants and in neighbouring companies.

Although we do a huge amount of advertising, and we work with Aéro Montréal and CAMAQ, among others, these are the details of our enrolment for this year.

At the beginning of 2019, we started 15 groups, and in 2021, we started four. There was a 60 per cent drop in the number of groups and a 73 per cent drop in the number of enrolments. The size of the groups was also cut by 30 per cent. We were able to offer individual courses so there would be continuous entries and variable exits instead of waiting to have 20 students per group. The situation is therefore rather concerning.

You will understand that when we are not able to start groups, we have to postpone their training. This year, six groups were not started; we had to postpone training for three groups once, twice for the training of four groups, three times for the training of two groups, and four times for the training of two other groups. We push the training courses back by one month, two months, and so on. It's quite alarming.

On the subject of foreign students, enrolment has gone from about 150, or one third of our enrolments, to three enrolments. That is dramatic. For training in machining, we normally have six groups at the same time. At present, we have one group of 15 students, who started in 2018. I can tell you that there are more companies that visit the school to do recruiting than there are students to recruit. Demand in this field is huge everywhere in Quebec.

There are other obstacles that impede enrolments: border closings, particularly this year; getting the documents needed for enrolling, which is a long and very difficult process; and the permanent residence process. As well, a very large number of students head for Ontario instead of coming to Quebec. After their training, which cost nearly $27,000, many of them leave Quebec and go to Ontario to get their Canadian citizenship. This is a striking observation in the case of the last five groups that left.

What we have to understand is that foreign students come to make up the numbers in groups already in place. Because there are practically no foreign students enrolling at present, we can't start our groups, and this obstructs training at the school and in the workplace afterward.

I will conclude my presentation here.

[The Chair, Liberal, Bobby Morrissey]

Thank you, Mr. Dionne.

Witnesses, I will remind you that you can respond in the language of your choice. I would ask you to speak slowly, which makes it easier for our interpreters.

We'll begin our opening round of questions for six minutes with Madame Kusie.

[Stephanie Kusie, Conservative, Calgary Midnapore, AB]

Thank you, Mr. Chair.

I'd like to thank the witnesses for being here today.

I found your testimony very interesting. One of the witnesses said that the government had announced two programs in the last week. I would like to say two things not just about the programs mentioned during this meeting, but also about those announced by the government. First, the government is doing as little as possible, as late as possible. Second, it made that announcement on the very day when we had the CFIB, the Canadian Federation of Independent Business, here at the committee.

With that said, my first question is for Mr. Guénette.

You talked about the two announcements made by the government in the last week. The first concerned the pilot project launched in Quebec under the Temporary Foreign Worker Program. It involves open work permits with restrictions in terms of province, for foreign workers selected to receive permanent residence in Quebec. I would like to hear your comments on the government's announcements regarding the program launched in Quebec.

Thank you.

[Jasmin Guénette]

Thank you, Ms. Kusie.

The aim of the recent announcement is to speed up the arrival of foreign workers in Quebec. As we have seen, Quebec is the province most affected by the labour shortage, with 64 per cent of small businesses affected.

All of the measures that can be taken by the federal government in collaboration with the government of Quebec to speed up the arrival of foreign workers in Quebec are good news. Of course, we hope that the changes will be felt as fast as possible within the companies. We want there to be a minimum of red tape and bureaucracy so the changes can come into effect as fast as possible. And we hope these measures won't be just announcements, and the will produce observable results on the ground.

[Stephanie Kusie, Conservative, Calgary Midnapore, AB]

Thank you.

As you said this morning, we have seen the [Technical Difficulty—Editor] of the Temporary Foreign Worker Program. I don't know whether you have had enough time to review the announcement and the content of the program, but I would first like to hear your general comments on the recommendations made in the report you talked about during your presentation.