Thank you, Madam Chair.
Good afternoon everyone. Thank you for having us.
My name is Véronique Proulx. I am President of Manufacturiers et Exportateurs du Québec, which is a part of Canadian Manufacturers and Exporters.
I will be presenting our brief in French today,
but I will gladly take any questions and answer in English following this presentation.
I am joined today by Isabelle Limoges, Director of Public and Governmental Affairs. Together we have over 20 years’ experience in supporting manufacturers with their various issues. I am very pleased to be here today to present our brief.
Our presentation will explain our point of view on labour supply and demand in the context of voluntary migration. We will only speak to this point, and more specifically to the situation in Quebec. I do apologize, but given the short deadline we did not have time to send you our brief; but we will send it to you afterwards, individually if need be.
Manufacturiers et Exportateurs du Québec represents 1,100 manufacturing enterprises throughout Quebec, of all sizes and from all sectors of activity, which reflects Quebec’s industrial makeup.
I will give you some context for our intervention. There are more than 23,000 manufacturers in Quebec, and 1,000 of them employ 100 people or more. They make up a network of SME manufacturers in Quebec. These enterprises employ close to 500,000 people.
In Quebec, the manufacturing sector accounts for 89% of exports, which is comparable to the rest of Canada. Our largest market is also the United States; 70% of our exports are sent to the U.S.
I want to speak to the digital transformation of enterprises. We know that in Quebec and in Canada, we are lagging behind with respect to the digital shift. It will have to happen eventually to ensure that the manufacturing sector remains competitive. I am mentioning it because the digital transformation of the manufacturing sector will have a very direct impact on the skills and competencies employers will seek in tomorrow’s workers.
What are the labour requirements of the manufacturing sector? The labour shortage has a very direct and very concrete impact on manufacturing enterprises. In the third quarter of 2018, there were 18,000 vacant positions. Of these 18,000 vacant positions, 60% required that applicants have at least completed the fifth year of secondary studies. These are low-skill positions, or, in the jargon of immigration, low-wage positions. For 40% of those positions, a CEGEP diploma was required, or more advanced studies.
What is the impact of the labour shortage in Quebec? I have met businesses that have to turn down contracts. We were in Plessisville recently. An enterprise that employs 600 people in the manufacturing sector had to refuse orders for lack of workers. Two weeks ago, on the Radio-Canada/CBC program 24/60, we heard about the case of Rotobec, which chose to settle in the United States because it could not find the necessary workers here in Quebec. Not only is it investing elsewhere, but it is doing so to the detriment of its Quebec and Canadian plant.
Once again, the labour shortage has a very concrete impact on the competitiveness and growth of the manufacturing sector.
At Manufacturiers et Exportateurs du Québec, we are working on five potential solutions with our members to resolve this shortage.
The first is immigration. It is very clear to us that immigration is a short-term solution to the labour shortage. We have to be able to receive more immigrants who meet the requirements of the labour market.
There is a second potential solution. In Montreal, there is a pool of workers who are here as a result of immigration. The unemployment rate is much higher among those who arrived in the country less than five years ago. We have to be able to let them know about the employment possibilities that exist in the regions, to connect them with employers, and integrate them in a sustainable way in the various regions of Quebec.
The third potential solution, and not the least among them, are women. Women occupy 28% of jobs in the manufacturing sector. If you exclude the administrative sector or office work, that rate is probably even lower. We have launched a national initiative called Women in Manufacturing, and its objective is to attract more women to that sector, notably in this context of labour shortage. The objective is to go from 28% to 33% of women in that sector over five years.
Young people are the fourth potential solution that deserves to be explored. They often turn their backs on the manufacturing sector, or they know little or nothing about it. It would be to our advantage to let them know more about it.
Finally, the fifth solution, and not the least of them, is automation and robotization, which would certainly allow manufacturers to increase their productivity and competitiveness, and to reduce their need for lower-skilled workers. It will also allow for the creation of more value-added positions.
After having spoken to you about these five potential solutions, let me repeat that immigration is the solution that will allow the manufacturing sector to alleviate the labour shortage. Of course, there is temporary immigration and permanent immigration.
In light of the speaking time at my disposal, I am going to speak about temporary immigration and the Temporary Foreign Workers Program, or TFWP. This program makes it possible to fill 18,000 vacant positions, 60% of these being skilled worker positions. The TFWP allows us to alleviate the labour shortage and reach full employment. It also allows enterprises that have seasonal requirements to have access to the workers they need.
In a full employment context, an employee will not choose a four- or six-month seasonal employment contract, which is very normal. An enterprise that has access to a big contract will need a certain number of workers for a year, but in a full employment context, workers will not choose to work on contract. They will choose permanent jobs. The TFWP allows employers to meet that need, particularly in Quebec.
The program is relatively complex for employers. It is cumbersome and complicated, which brings us to these four recommendations.
Our first recommendation is to eliminate the 10% threshold of low-skill, low-wage jobs per site. Let me take the example again of an enterprise that needs seasonal workers. In fact, in the appendix to our brief, you will find several examples of enterprises we documented, without naming them. That appendix provides the concrete reasons why the TFWP is useful to those enterprises, and lists the improvements that need to be made to that program. During the high season a business may need to fill 20% of low-wage, low-skill positions. However, currently the program limits that rate to 10%.
Our second recommendation is to adjust the labour market impact study mechanism—