Citizenship and Immigration Committee on May 14th, 2008

[The Chair, Conservative, Norman Doyle]

We do have a quorum, a reduced quorum, in the room. I want to welcome you here today as we continue consideration of the subject matter of part 6 of Bill C-50.

For the first hour, I want to welcome on behalf of our committee John Garson, VP of the policy development branch of British Columbia's Chamber of Commerce. Welcome. From the Canadian Federation of Independent Business, we have Corinne Pohlmann, VP of national affairs. Welcome also. From the Canadian Restaurant and Foodservices Association, we have Joyce Reynolds, executive VP of government affairs.

Welcome to all of you. Thank you for taking time to be here today to give testimony on Bill C-50.

I think you know the procedure. We start off with an opening comment, maybe seven minutes each, and then we'll go to questions and what have you from our members.

You take it from here in whatever order you want to go in.

[Corinne Pohlmann, Vice-President, National Affairs, Canadian Federation of Independent Business]

Thank you for the opportunity to be here this afternoon to share with you the perspective of small and medium-size companies on Canada's immigration system. I hope this will help you in your deliberations on part 6 of Bill C-50.

You should have in front of you a copy of our December 2006 report, which talks about the experience of smaller firms with immigration, based on a survey that got about 12,000 responses. You should also have a copy of a presentation that I'd like to walk you through over the next few minutes. So could you just turn to the first page, which looks like this?

[The Chair, Conservative, Norman Doyle]

Not all committee members have it, so maybe our clerk will have it distributed to committee members. We'll just wait for a moment.

Okay. You can proceed, Ms. Pohlmann.

[Corinne Pohlmann]

Thank you.

So on the first page, I just want to give you a quick overview of who CFIB is. It's a non-partisan, not-for-profit organization that represents the interests of more than 105,000 business owners across the country. These are primarily small and medium-size companies that we like to call the non-stock-market economy because they're independently owned and operated companies. They represent every sector of the economy, and they're found in every part of the country.

[The Chair, Conservative, Norman Doyle]

I think the interpreters would like you to slow down a little bit, and we're going to try to be flexible with the time anyway.

[Corinne Pohlmann]

CFIB'S positions on issues, just so you know, is always based on feedback we get from our membership. We gather this feedback through a variety of surveys throughout the year. We then pass on these results to you, the decision-makers, so you can incorporate some of their ideas and thoughts and concerns into your own decisions.

Moving on to the next page, it is always important to remember that the vast majority of businesses in Canada are small. In fact, 98% have fewer than 50 employees. Small and medium-sized businesses employ 60% of all Canadians, and they represent about half of Canada's GDP or economic output. This makes them a major component of Canada's economy.

On the next page you'll see that, given their clout, getting their perspective on how their businesses are doing can help us to understand where the economy is going. You can see on this page the CFIB's business barometer, which is produced quarterly and tracks the business expectations of Canada's smaller businesses. This information is used by the Bank of Canada and by Bloomberg in their analysis of Canada's economy. This latest barometer, which you have in front of you, is from March 2008, and it shows cautious optimism among smaller firms, which seem to be playing it safe for the moment, given the uncertainties south of the border, the Canadian dollar, and rising input costs.

However, in the next slide you'll see that despite this cautiousness, hiring plans remain strong, and 30% still plan to increase the number of full-time employees in the next year. This is equivalent to numbers we saw throughout the last few years. In other words, even as the economy softens, hiring plans remain strong.

In fact, on the next page you'll see that one of the fastest-growing issues among smaller businesses has been a shortage of qualified labour. This is behind the issues of total tax burden and government regulations and paper burden. In fact, in some provinces this is now the number one issue. In Alberta it's ranked number one as the highest-priority issue. In B.C. and in Manitoba, it is ranked number two. In places like Saskatchewan, Quebec, and Nova Scotia this is the third-highest priority issue among our membership. This is not just an issue out west any more. It is definitely spreading across the country.

There is good reason for this growing concern, as you can see from the next page. In March we released a report that found that the percentage of jobs that have been vacant long term—when I say long term, that means they have been vacant for at least four months—has been steadily increasing since 2004. And while 4.4% may not sound like very much, this translates into almost 309,000 jobs that remained vacant for more than four months across the country. This is up from 251,000 in 2006. You have in front of you the breakdown by province. Every province saw increases, with the exception of Alberta, where it stayed at the very high rate of 6.3%.

While this is an issue that is growing right across Canada, you'll see on the next slide that most employers also believe it will only get more difficult in the future. This is an important point, because while there certainly are some concerns in particular sectors of the economy and in certain parts of the country, the overall trend, given Canada's demographic future, is for shortages to increase. You have to keep in mind that Canada is not the only country in this situation, and we will have to compete with many other countries to get the people with the skills we need.

How are smaller companies dealing with this issue? On the next slide you see that most are hiring underqualified people and are training them to their positions. You can see other methods listed there on that chart, but there are two areas that I want to highlight. The first is that 38% are ignoring new business opportunities. This is of great concern, because if more and more businesses forgo new opportunities, doing so could ultimately result in slower economic growth and even put other jobs in jeopardy. This should be a concern for all of us.

I also want to highlight that only 5% say they recruited outside of Canada, but this actually translates into about 52,000 employers looking outside of Canada for employees.

In the book you have in front of you are results from our survey, which also looked at those who were recent immigrants who were already in Canada but had only arrived in the last five years. As you can see on the next page, for the vast majority of small and medium-sized companies, that's where their experience lies--with people who were already in this country. Only a very small group, 16%, were temporary foreign workers or--9%--had gone through the official immigration process. We also know anecdotally--and we hear this almost every day in our offices across the country--that many more have tried to use these systems but have been frustrated by the slow process and have given up trying to navigate many of the complexities in the system.

Of course, for those who did use the process, by far the biggest problem they faced was the delays in processing.

If you turn to the next two pages, you will see the feedback we received from our membership on those issues.

So the fact is that delay in processing was by far the number one issue for those using the permanent immigration system, as well as those using the temporary foreign worker systems, which is on the next two pages. When you need someone with specific skills, you cannot wait years for their arrival. You need them to help grow your business and to move it forward. Complexity is also an issue that keeps many employers from attempting to try to recruit overseas.

Listed on those two pages are other issues that small businesses face, and we recognize that there have been some changes recently to help address some of those issues. Obviously, finding ways to deal with this backlog and the extensive wait times is of utmost importance to Canada's smaller companies.

But I also want to touch on one last problem related to this debate on the last few slides in your slide deck. As you know, 60% of all new immigrants are categorized as economic immigrants, and of those, only about 33% are designated as skilled workers. Of those skilled workers--this is the second to last slide--the vast majority of them coming to Canada are designated as professionals: 22% are designated as having skilled and technical expertise; 9% are designated as managers; 3% have intermediate or clerical skills; and none come with entry-level skills.

If you go to the very last slide, it compares the skills required for those occupations in highest demand among Canada's small and medium-sized enterprises, and it compares it with the skills being brought in through the permanent and temporary immigration system. As you can see at the very top, 42% of those occupations in demand among small businesses require people with skilled and technical training, but only 22% of those in the permanent immigration system have that skill. Further down, 65% have professional training, but only 7% of occupations among small and medium-sized businesses require that particular skill. Then we wonder why so many highly educated immigrants are underemployed in Canada.

This leads me to my last point, which is that we must create a more honest immigration system that does not build up expectations among those coming to Canada, because too many of them end up disappointed. We are fortunate that so many want to make Canada their home, so let's be honest with those who want to emigrate to Canada about the types of skills that are in demand among Canada's employers.

In conclusion, CFIB believes that something must be done to deal with the large backlog of applications, which causes long wait times for those who want to come to Canada. Whether part 6 of Bill C-50 is the best way to do this is difficult for me to say. But I can say that regardless of whether you support this part of the bill or not, I do hope that you agree that finding ways to reduce those wait times is essential and that we need to bring more honesty, flexibility, and employer involvement into Canada's immigration system, given the economic realities we face today and in the future.

[The Chair, Conservative, Norman Doyle]

Thank you very much. That was very interesting.

Mr. Garson or Ms. Reynolds.

[Jon Garson, Vice-President, Policy Development Branch, British Columbia Chamber of Commerce]

Thank you.

I'd like to thank the committee for the opportunity to present the perspectives of the B.C. Chamber of Commerce's 30,000 business members. These members represent every size, every sector, and every region of our province.

This is a particularly critical issue for British Columbia and for our membership, so the changes proposed to the Immigration and Refugee Protection Act, as contained in Bill C-50, part 6, is a significant issue for our members.

To be clear, my comments today represent a policy position that has been developed by our membership. The B.C. Chamber of Commerce has a very clearly defined and well-structured policy development process. We ask our members to bring us their issues of concern. We then work them through a very significant committee structure. They are then presented to our entire membership at our annual general meeting, and only if they are voted on and adopted by two-thirds of the membership do they become our stated policy position.

That process in 2006 led to the adoption of a resolution that we have titled “Overhaul of the Canadian Immigration System”, and it is that policy position that forms the basis of our comments to you today.

The B.C. Chambers of Commerce have been the leading voice for almost a decade, calling for government at every level and the business community to realize the scale of the challenge facing the province, and more recently the country, through the looming skills and labour shortage that we're facing in every sector. This has been identified by the chamber in our “Moving Forward” report, by our “Closing the Skills Gap” report of 2002, and rather unimaginatively, our “Closing the Skills Gap II” report of 2008.

Until recently we have held the very strong position that these calls have not been heard and have not been heeded. With this in mind, we must congratulate the federal government for the role it is playing in addressing many of these issues of concern to business, particularly those in the west. Over recent months this action has seen the introduction of or the soon-to-be-introduced new Canadian experience class, a new expedited labour market opinion program, the overdue launch of the first phase of the foreign credential recognition office, and a significant expansion of the provincial nominee program that in British Columbia will see 15,000 high-demand occupations being taken in through this program by 2010-2011.

We are particularly pleased with all of these areas because the resolution that was passed by our membership in 2006--and I am going to summarize the recommendations for you--called for the overhaul of the permanent immigration system. It called for the immediate allocation of resources to offices overseas to assist with the processing of applications. It called for a shift of resources away from family class immigrants into the skilled worker class to cut the wait times that are currently being experienced, and it called for government to ensure that the process for bringing foreign workers to Canada is driven by a true reflection of supply and demand, rather than being process-driven.

The chamber believes that the proposed changes, as outlined in Bill C-50, go a long way to addressing many of these concerns that have been expressed by our members.

Bill C-50, we believe, brings the welcome elevation of economic priorities as a cornerstone of the changes that are proposed. The chamber believes the flexibility as a result of this must be enshrined in the system. The needs of the economy today will not be the needs of the economy tomorrow. As we have seen with the institutional refusal to undertake changes to the point system, without a more flexible approach we will almost inevitably return to a situation where the system quickly falls behind the needs of the economy.

Despite our support of Bill C-50, however, the chamber does have two reasonably significant concerns or reservations regarding the proposed changes. I would be extremely surprised if the committee has not heard the first, and that is the change to subsection 11(1), which removes the “shall” and inserts a “may” into the process.

From our perspective, if you are a prospective immigrant, you go through the application process, you put the paperwork in, you go through all the checks and balances. If you are successful in all of those stages, we do not see a situation whereby you would be removed or refused a visa to enter Canada. The structure that's put in place is very clearly defined. It is quite a rigorous one. From that perspective, if you go through that process, we believe you have the right to be issued a visa.

While the principles released by the ministry outline a commitment to identify the priority occupations--and the ministry has stated this will be based on input from the provinces, territories, the Bank of Canada, employers and organized labour--the manner of these consultations is neither mandated prior to the issuance of instructions, and we understand these instructions could be issued more than once in the space of a year, nor required for each set of ministerial instructions. As such, the chamber believes the ministry should mandate full consultation priority areas prior to the issuance of any ministerial instructions, no matter how many times they are issued in the space of a year.

Furthermore, the chamber also believes that these consultations should be made public and that the consultation material and feedback be tabled, along with the instructions that are part of the changes the minister will put before the House when the minister issues those instructions to her department.

I would like to give you a bit of a brief as to why this is such a significant issue for British Columbia. While the scale of the challenge facing Canada is indeed significant, it is particularly acute in British Columbia, and also in Alberta. We have gone through a process this year whereby we have reached out to our members to try to identify what are the priority areas for the business community. And from all of our member chambers who responded, the only issue that was identified by every single one of them was the skills and labour shortage. Transportation was obviously in there heavily, but the skills and labour shortage came up strongly as the single issue that needed to be tackled.

When we look at Canada, we see that the current estimates indicate that 100% of the net growth in the Canadian labour force will result from immigration by 2016. In B.C. we will reach that by 2011, so it is a more profound issue for British Columbia, in particular, than for many other jurisdictions. This is driven by an extremely buoyant labour market: employment in B.C. has risen by over 370,000 jobs since December 2001, and 90% of those jobs are full-time positions. Indeed, over this period, B.C. has had the highest employment growth rate in all of Canada. B.C. has an overall unemployment rate of 3.9%, as of February 2007. Seven out of ten of the top occupational categories have unemployment rates ranging from 0.5% to 3.3%. So structurally, as a province, B.C. is very close to, if not at, full employment, depending on which economist you talk to.

Further to this, it is estimated that over the period of 2003 to 2015, B.C. as an economy will create one million new job openings. It is important to note that this does not take into account the bump in employment that we will get from the 2010 Olympic Games. These are structural changes, through the growth of the economy, and don't take into account the Olympics.

During that same period, B.C. will graduate 650,000 students through the K to 12 system. Even if we were to keep all of those 650,000 students in British Columbia, it would still leave us with a shortfall of 350,000 job opportunities that cannot be filled by workers in the province.

Again, while the federal government and the province have made great strides with enhancements to the temporary foreign worker program, that is, the expansion of the provincial nominee program that we mentioned earlier, quite frankly, these changes are tinkering around the edges. In British Columbia, the need for workers requires structural reform to the immigration system. Quite simply, the current system is not capable of addressing the scope of the challenge. Fundamental reform is required.

I'd like to echo a comment made earlier that while immigration is looked at as the most significant means of addressing this, we do agree with the C.D. Howe Institute, for example, which has made comments that immigration is not the silver bullet or answer to our problem. But it is the most significant piece of the solution to the issue we actually face.

However, we must bear in mind that we are in a very competitive global environment for these skilled workers. Whether we look at that changes just introduced in the United Kingdom or the changes introduced in Australia, there are a number of jurisdictions that are making significant or fundamental reforms to their immigration systems, with a view to capturing the skilled, educated workforce essential to our success in the 21st century knowledge economy.

We would like to wrap up by saying that immigration can no longer be viewed as a domestic issue, nor can it be viewed, quite frankly, as a discussion of our role as a leader in humanitarian and refugee protection. We understand that the proposed changes will still enshrine our commitment in these areas. They are critical and essentials part of Canada's role in the world. But we are particularly pleased that the changes actually shift the focus of education or rather rebalance the focus of the immigration system onto the economy, as well as these other critical roles. We do feel that it has been missing.

If we look at family class reunification in British Columbia, there are just over 14,000 who were brought in here in 2007, compared with 16,000 skilled workers. We believe that shift or balance is not in the best interest of the economy, and we hope that through this process we can actually get into a situation of focusing on that.

[Jim Karygiannis, Liberal, Scarborough—Agincourt, ON]

Do you think that my parents are not right to be in Canada?

[The Chair, Conservative, Norman Doyle]

Order, order.

[Jon Garson]

If you have a question, I'd be happy to answer it—

[The Chair, Conservative, Norman Doyle]

Mr. Karygiannis, order please.

When the time rolls around for questioning, we will get on to questions—

[Jon Garson]

The solution to the skills and labour shortage facing Canada is clearly to bring in more skilled immigrants. The chamber believes that the changes proposed by Bill C-50, part 6, are a long-overdue recognition of how serious the current and future skills shortage is, by recasting immigration with a view to balancing our economic and social goals as a country.

Many of our competitors throughout the world are actively recruiting young skilled workers. I know; I have looked through this process. Having come in as a family class immigrant four years ago, I understand the system very well. I've helped a number of people through it, and we think that as a general principle, the intent of Bill C-50 is certainly one that our members in British Columbia strongly support.

[The Chair, Conservative, Norman Doyle]

Thank you.

Mr. Carrier, do you have a question, sir?

[Robert Carrier, Bloc, Alfred-Pellan, QC]

We have to ask people to speak a little more slowly because we need simultaneous interpretation. The witnesses are speaking too quickly and we really are not getting a good translation of what is being said.

[The Chair, Conservative, Norman Doyle]

Okay, that's a valid point.

Maybe you can slow it down a little in your statements so the translators won't have as many problems as they seem to be having right now.

For our last statement, we will go to Ms. Reynolds.

[Joyce Reynolds, Executive Vice-President, Government Affairs, Canadian Restaurant and Foodservices Association]

Thank you, Mr. Chairman.

I really appreciate the opportunity to provide a food service industry perspective on part 6 of Bill C-50, and to speak to you again about the number one issue facing Canada's $58-billion food service industry. Of course, that is labour shortages.

I represent a 33,000 member organization, governed by a 36-member board of directors representing every sector of the industry in every region of the country. For our members in western Canada the labour shortage is already a crisis. For the balance of the country, it is a growing problem, and it will get progressively worse over the next 20 years.

Low fertility rates and the retirement of baby boomers will create a labour shortage of unprecedented proportions. The numbers are daunting. The Conference Board of Canada projects there will be a shortfall of about a million workers by 2020 unless we do something to increase the available labour pool. The economic forecasting company Global Insight expects the labour shortage will reduce real GDP growth and cost the Canadian economy billions of dollars in lost output.

All industries will suffer from this labour shortage, but the outlook for the food service industry is particularly grim. The food service industry today relies on young people for our workforce. More than 483,000 of our employees are 15 to 24 years of age. Projections suggest that by the year 2025 the population of 15 to 24-year-olds in Canada will actually decline by 345,500. Over the next 10 years the food service industry alone will need to add 190,000 new workers. Demographics tell us that the situation the industry is currently experiencing in Alberta and B.C. is spreading across the country. We are already hearing from members in every part of the country who are having difficulty recruiting staff.

We recognize that the labour shortage is a complex challenge and there is no magic bullet. Businesses must be flexible and creative in their recruitment of workers, and they must place a higher priority on the retention of existing employees. Food service operators are increasing wages and benefits, and they are increasing capital investments in labour-saving devices, but opportunities to replace people in the service environment are limited. Restaurant operators are also putting more emphasis on attracting and accommodating under-represented groups, such as aboriginals and persons with disabilities. They are looking for new pools of talent, such as older workers, to entice into the industry. But these are not enough.

We can't overcome the demographic reality confronting the labour market. We need dramatic changes in public policy. Our employment and immigration policies were developed in an era when unemployment was the national challenge. The new challenge is finding workers. We are competing with every other developed country in the world experiencing the same demographic trends and labour shortage challenges. We can expect the international competition for workers to only intensify.

Our members are extremely frustrated by the four- to six-year waiting period to bring in qualified help. They will identify a top-notch international chef who is willing to immigrate to Canada. The chef applies for landed immigrant status. But long before his or her application comes up for review, he or she has successfully immigrated to Australia or New Zealand, where the wait times are a quarter or half as long.

CRFA believes that Canada's immigration policies must be more labour-market focused. We support part 6 of Bill C-50 in principle because we need a system that will reduce wait times and be flexible enough to meet labour market needs. That's provided it does meet the diverse needs of Canada's labour market.

The labour shortage is much more than a skills shortage. Our industry is experiencing a growing shortage of all workers--skilled, semi-skilled, and unskilled. We need assurances that the ministerial instructions regarding the processing of certain categories of applications will apply to all classes and types of workers. We also need to understand the methodology and criteria that will be used to prioritize and quantify labour shortages and to receive assurances that guidelines will be applied transparently and consistently.

Modernizing our immigration system also means putting more emphasis on Canadian work experience and school credentials and less emphasis on foreign education and experience. A higher weighting of Canadian job experience would act as a bridge between temporary foreign worker programs and permanent residency, particularly for lower-skilled workers. It makes sense for Canadian employers to recruit international workers who have already demonstrated their ability to adapt to Canadian culture and successfully integrate into the Canadian job market.

Last month when I appeared before this committee, I indicated we were pleased the government had introduced the Canadian experience class as a new immigration stream, allowing temporary foreign workers to apply for permanent residency without leaving Canada. However, we are frustrated this new immigration stream is currently only available to workers in NOC codes A, B, and O and will not apply to the majority of temporary foreign workers in the food service industry. This, we believe, will limit the effectiveness of Bill C-50.

In summary, Mr. Chairman, Canada's food service industry has faced its share of challenges over the years, but nothing will affect the industry more than labour shortages. We are pleased that government recognizes the urgency of this issue and is taking much-needed steps to overhaul the immigration system. However, before we put the industry's full support behind the amendments, we need to be sure they include all classes and types of workers in Canada, reflect in-demand positions, and that the criteria for selecting occupations under pressure is well thought out, transparent, and consistently applied.

Thank you.

[The Chair, Conservative, Norman Doyle]

Thank you, Ms. Reynolds, and all the people for a very interesting....

Point of order, Mr. Wilson?

[Blair Wilson, Independent, West Vancouver—Sunshine Coast—Sea to Sky Country, BC]

Thank you, Mr. Chair.

Although I listened intently to what the witnesses had to say, especially Ms. Reynolds, and while I disagree with her conclusion, I have to agree totally with the facts leading up to where she went on to say she was hopeful the government was going to come forward with some modernizing points.

[The Chair, Conservative, Norman Doyle]

Your point of order?

[Blair Wilson, Independent, West Vancouver—Sunshine Coast—Sea to Sky Country, BC]

My point of order is that I would like to know if we could ask to obtain a copy of the speech she wrote and just read.

[The Chair, Conservative, Norman Doyle]

That's not a point of order, but it's a request I'm sure she'll be happy--

[Joyce Reynolds]

I'm going to send copies to the clerk, because I don't have it in both official languages.

[The Chair, Conservative, Norman Doyle]

Thank you. So that will be distributed in due course.

Our first questioner will be Mr. Telegdi. Seven minutes, sir.

[Andrew Telegdi, Liberal, Kitchener—Waterloo, ON]

Thank you very much.

Welcome. What you're telling me is what I hear in my riding all the time. I think your perception of the problem that there's a shortage is correct. However, I would disagree with you as to how you get to a solution.

The immigration system virtually overwhelmingly has been run by the bureaucrats, with very little accountability. When we changed the Immigration Act in 2002, it was made incredibly elitist. If anybody wants to review the minutes as to what committee members said at the time, we are shutting out carpenters, we are shutting out tradespeople, we are shutting out labourers, and essentially the statistics bear that out.

We have an incredibly elitist system, and it was designed by the bureaucrats. I've been here for ten years, and seven ministers have come and gone. It's not a surprise that we're in such a mess.

We need to redo our point system. Initially, Australia and New Zealand and European countries did it. The United States is now looking at our open, transparent point system, which in itself is good. What is not good is the way we allocated the points. It doesn't make any sense. If you want to take a look at the point system and look at it in terms of what Australia does and what New Zealand does....

Getting people in here is not rocket science. It shouldn't take five years.

There's a memo that surfaced when the department got taken to court back in 2003. A memo was made to the minister from the bureaucracy. What they essentially say is that we artificially constrained the resources that go into immigration processing because that's the only way they have to control the number of people we let in.

So what you have to do is continually have the backlog back up. Our problem right now is we have our inventory, but not what you're looking for. It was really, really blown. And I say to you it wasn't blown by the politicians; unfortunately, it was blown by the bureaucracy.

The danger of what they're proposing is there's going to be less accountability. They can say all they want, that the minister will do this and the minister will do that. The minister doesn't know. Who's going to do it? It's going to be done by the bureaucrats. What they're saying is they don't want the courts ever to have any oversight of what they're doing, which at first might be really good, except if you need somebody's visa redone, renewed, it doesn't happen, and there's no way you can keep the system accountable.

So we need to redo the point system and get rid of the elitism in there. Just imagine how many people there are out there who want to come to Canada. Labourers? We shouldn't have any shortage of labourers. All we have to do is allow them in.

In terms of processing times, in the Dragan decision it made the point that it takes 10 to 15 minutes to do an assessment of an application, which is followed by a one-hour interview, if the interview is needed. You can get somebody in in less than an hour, but the reason people don't get in is they are kept on the wait line. They have two years before the department gets back to them. It's a dysfunctional system, and the bureaucrats blew it. Now they're trying to come forward with something that even gives them more power, makes it more or less transparent, and makes them less accountable.

I really urge your organizations to take a look at this. Take a look at it. Study it. This committee told the government what was going to happen, but unfortunately we had a new minister, just like we have a new minister now, and ultimately, they went hook, line, and sinker to what the bureaucracy said.