Industry Committee on April 7th, 2014

[The Chair, Conservative, David Sweet]

Good afternoon, ladies and gentlemen.

Good morning everyone.

Welcome to the 17th meeting of the Standing Committee on Industry, Science and Technology.

We are pursuing our study on the entertainment software industry. We have officials before us from the Department of Citizenship and Immigration: David Manicom, director general, immigration branch; and Martin Mündel, director, temporary resident program delivery division. We also have with us, from the Department of Employment and Social Development, Alexis Conrad, director general, temporary foreign worker directorate; Monika Bertrand, executive director, transfers and renewal, employment programs and partnerships directorate; as well as Amy Mifflin-Sills, the director of the program policy, skills and employment branch.

How may of you will be giving opening remarks? Two of you, okay.

We will begin with the Department of Citizenship and Immigration, as on our agenda. Go ahead with your opening remarks, please.

Mr. Manicom.

[David Manicom, Director General, Immigration Branch, Department of Citizenship and Immigration]

Mr. Chair, we had felt that the ESDC would begin, but I can start first if you would prefer.

[The Chair, Conservative, David Sweet]

If that works better, then I tell you what, I will take your lead.

[Alexis Conrad, Director General, Temporary Foreign Worker Directorate, Department of Employment and Social Development]

Thank you, Mr. Chair. Also, thank you to the committee for inviting us to today's meeting and for this opportunity to speak with you.

I would like to speak to you about some of ESDC's labour market programs that can help address the evolving skills needs of the entertainment software industry.

While Canada has had a good job creation record in recent years, challenges remain, as many Canadians are still out of work or underutilized at a time when employers are concerned about skills and labour shortages in certain sectors and regions.

While shortages are not universal, there is evidence of skill shortages in certain regions and sectors; including some occupations in the entertainment software industry.

These are complex issues and require collaborative efforts by government, the education and training sector, businesses and other key stakeholders to be addressed.

While addressing labour market challenges has been a long-standing objective of the ESDC, the government has recently announced measures to tackle these types of skills pressures in high-demand fields by focusing in three areas: first, transforming the skills training to better reflect labour market needs; second, training the workforce of tomorrow; third, ensuring Canadians have the first chance at available jobs.

As part of our work to transform skills training to better reflect labour market needs, we are in the process of transforming the labour market agreements, which expired on March 31, to new six-year Canada job grant fund agreements. As part of these new agreements, the government introduced the Canada job grant, which will be rolled out beginning July 1, 2014. The grant will be available to all private and non-profit businesses with a plan to train Canadians for a new or better job. Under the grant, employers will pay one-third of the cost of training, while the federal government will pay the other two-thirds. Small businesses can also benefit from flexible arrangements, such as the potential to count wages as part of their contribution. The grant could be used to help Canadians get the short-duration training they need for available jobs in the gaming sector.

We are also working to renegotiate the labour market development agreements and labour market agreements for persons with disabilities to better align training with employers' needs.

Students in Canada's education system are the largest source of labour market supply and helping them transition into jobs is a priority for the Government of Canada.

The Youth Employment Strategy is the government's flagship program to help youth, aged 15 to 30, gain skills and work experience to transition into the labour market.

The entertainment software industry, amongst others, can take advantage of this program. The YES is $330 million annually, is led by Employment and Social Development Canada and delivered by 11 federal departments and agencies.

For example, the career focus program helps post-secondary graduates to transition to the labour market through paid internships. This program also helps to better inform youth career choices through labour market information and work experience to help youth make more informed career decisions, find a job, and/or pursue advanced studies.

Through budget 2013, the government provided an additional $70 million over three years for the career focus stream of the youth employment strategy to support internships for recent graduates. As part of budget 2014, the government also announced it would take further steps to ensure youth employment programs kept pace with the evolving realities of the job market. More specifically, efforts will be made to promote internships in high-demand fields, such as the skilled trades and in science, technology, engineering, and math, so that youth can gain the work experience and skills necessary to find and retain jobs in industries such as video gaming, among others.

Furthermore, budget 2014 announced additional measures to ensure that apprentices are getting supports while in technical training, with the introduction of the Canada apprentice loan.

We are also exploring whether there are other opportunities to increase the supply of skilled labour through apprenticeship. Minister Kenney recently concluded a trip to Germany where they are testing new and innovative ways to have the apprenticeship model be applied to a broader range of occupations such as the information and communications technology industry.

ESDC also has a number of other programs that help improve participation of groups that are under-represented in the labour market: for example, the aboriginal skills and employment training strategy, the skills and partnership fund, first nations job fund for aboriginal people, as well as the opportunities fund for persons with disabilities.

Ensuring that Canadians have the first chance at jobs includes enhancing working centres and better connecting Canadians with the available jobs, making sure that employers looking for workers and workers looking for jobs can find each other. Budget 2014 announced additional measures to modernize the job bank, and plans to introduce an enhanced job-matching service, which will automatically match job seekers and employers on the basis of skills, knowledge, and experience.

Before closing, I would be remiss if I did not mention the temporary foreign worker program. Over the last few months, we've had the opportunity to meet with many representatives of the entertainment software and gaming industry. They have impressed upon me their strong commitment and efforts to recruit, train, and retain Canadians to work in the industry. They've also been clear that there are times when they simply cannot find Canadians or train them in time to do critical work, particularly skilled jobs at the top end of the talent continuum. This is either because the age of the industry in Canada means that not enough Canadians have had time to develop these very high-end skills or because some jobs are so highly specialized that there aren't Canadians who have that knowledge.

As a result, the industry has stated that they have and will continue to have needs for temporary foreign workers to fill these positions. They have been clear that they need these workers quickly, and are frustrated when delays in processing labour market opinion applications happen.

Recent and pending reforms to the temporary foreign worker program are not intended to stop the entertainment and software gaming industry from having access to highly specialized temporary foreign workers. In fact, the government is focused upon making sure that employers with a good track record who have demonstrated that there are no available Canadians to do highly paid work have timely access to temporary foreign workers.

The purpose of these reforms is to ensure that temporary foreign workers are not used as substitutes for Canadian workers or in lieu of a proper HR strategy to hire and train Canadians, and that employers who use the program play by the rules. That is why the government is putting in place requirements that companies who apply for temporary foreign workers include a plan outlining the steps they will take to transition to a Canadian workforce. Additionally, the government is introducing administrative monetary penalties as another tool to sanction employers who do not play by the rules.

From the discussions we have had with the industry, we believe these reforms will help the entertainment software and gaming industry and will support its continued growth in Canada.

In conclusion, we would like to add that the committee's study is timely, as the government is currently transforming its skills programming to be increasingly oriented to the evolving needs of employers and the labour market overall. We look forward to seeing the recommendations from the committee's study.

Thank you.

[The Chair, Conservative, David Sweet]

Thank you very much, Mr. Conrad.

Now we have Mr. Manicom.

[David Manicom]

Mr. Chair, members of the committee, thank you very much for this invitation.

As director general for immigration policy at Citizenship and Immigration Canada, I am responsible for the development of policies to facilitate the entry of both temporary and permanent residents in a way that maximizes their economic, social, and cultural contribution to Canada.

I'll just make some very brief remarks to follow up on those of my colleague from ESDC, and speak briefly about our overall economic immigration programs that may benefit this industry.

As members of this committee are aware, employers must generally first apply to Employment and Social Development Canada for a labour market opinion (LMO) to hire a temporary foreign worker. Once this authority is granted, the intended employee can apply to CIC for work authorization, and for a visa if they are from a visa-required country.

However, there are certain types of business persons, such as those coming to Canada under a free trade agreement like NAFTA, who may be authorized to work in Canada in the absence of a labour market opinion. Other foreign nationals who may be authorized to work in Canada temporarily in the absence of a labour market opinion include youth coming to Canada on a working holiday as part of bilateral international agreements, and recent graduates of a Canadian post-secondary institution, among others.

In all cases, exemptions to the labour market opinion requirement are only granted in situations where the temporary employment of the foreign national is in the national interest.

Since 2012 the government has been conducting a review of the temporary foreign worker program to ensure that the program is aligned with today's economic and labour market needs, including where Canadians and permanent residents must be first in line for available jobs. Many of the changes to date have focused on the labour market opinion process; however, in addition, Canada's economic action plan 2014 committed to reviewing streams of the temporary foreign worker program that are exempt from the labour market opinion process.

I understand that some of your previous witnesses have commented specifically on changes to the process for bringing in temporary foreign workers as intracompany transferees, which is one of the LMO-exempt streams of the temporary foreign worker program. Last year, CIC consulted with employers and stakeholders in the review of the Intracompany Transferee component. this review is continuing with the objective of ensuring that this stream is used as intended.

More broadly, we are also working to ensure that economic immigrants have the skills and human capital to meet Canada's labour market needs and succeed in Canada. Previous work experience in Canada is often of significant benefit to new permanent residents. In that respect, the temporary foreign worker program serves as an important way to attract foreign nationals who may go on to successfully settle in Canada permanently. Programs such as the Canadian experience class, federal skilled workers program, and provincial nominee programs are all aimed at attracting highly skilled professionals to Canada.

For example, as part of the federal skilled workers program, employers can make a permanent job offer to a temporary foreign worker who is either abroad or is already here in Canada. Under these programs, getting in workers with needed skill sets is a key priority. To that end, applicants with valid job offers move to the front of the processing line.

In addition to existing programs, CIC is working hard to roll out a new electronic system to manage immigration applications next January. This system will allow the Government of Canada, provinces, territories, and employers to actively target highly skilled immigrants under key economic immigration programs. This change is intended to make our permanent immigration programs even more responsive to the needs of the labour market and economy, and employers in the gaming industry may find this to be a useful tool to focus efforts to recruit needed talent.

l understand that employers are concerned about processing times associated with work permit applications. l would like to assure you that CIC is committed to improving client service and modernizing its operations, with measures to improve efficiency, strengthen program integrity, and develop seamless service delivery.

l would just mention two such operational changes that may address some of the issues raised in previous committee meetings. CIC introduced electronic applications more than a year ago for all visitors, international students, and temporary foreign workers. Applicants using this online system are able to self-serve online by enrolling and logging in to a secure environment, uploading forms and documents, paying fees, and communicating with CIC.

Applicants in these categories also have access to application support services in more languages through our rapidly expanding global network of visa application centres. Unnecessary delays—such as when applications are incomplete—are minimized with the help of these centres. Both e-applications and the expansion of the visa application centre network are an improvement to service for temporary foreign workers.

To conclude, our two departments continue to examine ways to improve the existing temporary foreign worker program, with further announcements forthcoming.

Thank you.

[The Chair, Conservative, David Sweet]

Thank you very much, Mr. Manicom.

Colleagues, part of the last discussion about how the meeting would go was that we were going to try to get all the questions done within an hour, and then if we needed some optional time, we'd do that.

We'll begin now. We'll have five-minute rounds right across the board for everybody.

We'll begin with Mr. Lake.

[Mike Lake, Conservative, Edmonton—Mill Woods—Beaumont, AB]

Thank you, Mr. Chair, and thank you to the witnesses for coming today.

I want to zero in on two facts that we've heard today but also heard throughout the testimony.

First, as we heard today, Canada's job creation record is very strong. I believe it has had one of the strongest job creation records in the developed world since the global recession in 2009. Second, I think per capita we have the strongest gaming industry in the world. We have these two positions of strength in a sense, and the reason you're here today is that we have to come up with innovative solutions to ensure we maintain the momentum we have in that industry.

Mr. Conrad, you spoke for a little and listed at a high level some of the things the government is doing to maintain that strong job creation record. Maybe you could drill down a little more on some of the things that I think.... The job grant would be a good place to start, a little description of how that works and how industries like this would be able to benefit from that specifically.

[Monika Bertrand, Executive Director, Transfers and Renewal, Employment Programs and Partnerships Directorate, Department of Employment and Social Development]

Thank you for that.

With regard to the Canada job grant in budget 2013 the government announced a renegotiation of the labour market agreements and introduced the Canada job grant. At the heart of the Canada job grant is really the need for greater employer engagement in training and training decisions, and also greater employer investment in training.

The job grant is to be rolled out this year, just to give you an update on where we're at with it. We have been working with provinces and territories and have agreements in principle or letters of intent for negotiating implementation of the job grant. Two provinces have signed agreements, that's British Columbia and Ontario, so they will be implementing the job grant starting July 1.

Now how it would work is that, in general, businesses, employer organizations, including the entertainment software industry, are eligible to apply for a grant. It's a $15,000 maximum contribution to training. It is cost-shared. Employers would contribute a third to the training costs and it is available to all employed or unemployed Canadians who are looking for a new or a better job. For small businesses, of course, there's a certain flexibility required and there are provisions in the Canada job grant to make sure that small businesses can take advantage of that program. For example, when it comes to the employer contribution, wages could potentially count toward the one-third employer contribution.

The importance really is that employers get to select the training that they need. As I said in the beginning, that is at the very heart of the Canada job grant. So if an employer has a job and has an individual either employed or looking for a better job or is ready to train somebody unemployed, it is the employer who decides what training will be provided for the individual to equip that person for the job. So this is, in essence, how the Canada job grant works.

[The Chair, Conservative, David Sweet]

Mr. Masse, now, for five minutes....

[Brian Masse, NDP, Windsor West, ON]

Thank you, Mr. Chair.

Thank you to the witnesses for being here.

Prior to this life I worked as an employment specialist on behalf of persons with disabilities, youth at risk. It was part of the opportunities fund in Windsor, Essex county. I'm just wanting to know about the grant. Is this going to be like wages money? Is this going to be specific training? Can I use it for WHMIS? What type of training and what type of subsidy is there? Will it be a wage subsidy? How long will it go over or what period of time? How are you going to track the employers?

What we found was that we had to be very careful what employers accessed it, because there's a high degree of abusing a wage subsidy and then dumping the employee afterwards. What are you going to do about those things?

[Monika Bertrand]

First, I want to mention that these are provinces and territories implementing the Canada job grant. But there are certainly certain parameters around it when we're talking about the $15,000 maximum. It is for a direct training cost. It is for tuition. It is for books and whatever costs are involved in a certain type of training.

When it comes to wages as in wage subsidies, as I had mentioned for SMEs, there is a certain flexibility where part of the wage could count as the employer contribution. In terms of the length of the training, we are talking short-term training. Again, it is up to the provinces and territories to decide exactly how long that training period can be. But just to give you an example, if we are talking about an apprentice, then we're talking about a three-year to four-year training period. The Canada job grant would be available for a training module, but it wouldn't be intended for a four-year training period.

[Brian Masse, NDP, Windsor West, ON]

Will people have the opportunity to use this multiple times, or will it just be a one-time thing that a person can access?

[Monika Bertrand]

An employer can apply once for an individual.

[Brian Masse, NDP, Windsor West, ON]

Okay. What 11 departments and agencies will be delivering this? Communication will be key to find out who are the abusive employers and who are the good employers, and also following up on whether or not somebody has actually completed the training. If they drop out of their training, do they pay it back?

[Monika Bertrand]

Again, this is something the provinces and territories are going to implement, and which departments are delivering or are leading the implementation of the Canada job grant I cannot tell you. This is something that's to be—

[Brian Masse, NDP, Windsor West, ON]

I have a quick question on immigration. They have closed our immigration office to the public in Windsor, so people can't even get assistance there anymore. I actually have to hire a staff for just immigration work, so I have a lot of empathy for the video game industry.

How are you going to measure some of these changes to follow up to find out whether or not the things you are talking about are going to be successful?

[David Manicom]

Sir, I'm not sure which things you're referring to.

[Brian Masse, NDP, Windsor West, ON]

It's in your document. Several times you talk about a few things that will hopefully.... You've met with the industry. You're saying such things will benefit. There are several thoughts there. But are you going to be measuring with the industry over time to see whether or not they get improvement in terms of quicker access to the decision-making in the process?

The biggest problem seemed to be the uncertainty with that, and then the delays cost them the projects they want.

[David Manicom]

We're certainly working very hard to improve overall processing times at our offices abroad, if that's what you're referring to. The government, as I mentioned, is also rolling out the new expression of interest program, and we will be doing an ambitious employer outreach program across the country in an ongoing way to explain to employers how they can have access to this new pool of talent.

I think we'll be measuring our outcomes based on how many employers successfully use that new system, and with regard to existing temporary foreign worker programs, what progress we continue to make in ensuring processing times are prompt.

[Brian Masse, NDP, Windsor West, ON]

Do I have any time left?

[The Chair, Conservative, David Sweet]

You have 30 seconds.

[Brian Masse, NDP, Windsor West, ON]

That's fine. Thank you.

[The Chair, Conservative, David Sweet]

Thank you very much.

Now we go to Madam Bateman, for five minutes.

[Joyce Bateman, Conservative, Winnipeg South Centre, MB]

Thank you very much.

Thank you to all of our witnesses for being here. I'm particularly impressed that you clearly talked to each other before. They say departments don't talk to each other, but you're living proof that you do, so thank you for that.

Some of you focused on how to get people into the country, and I think that's a worthwhile goal and important. But for me, representing Winnipeg South Centre, there are lots and lots of people like me who have children in their late teens, early twenties, even thirties, who are looking to get work and wanting to find out how.

We have just had a fascinating study on this video industry, which is huge and new and burgeoning. There are probably lots of mothers and fathers in my riding who think that their son, based on.... I mean, if you have read Malcolm Gladwell's Outliers, these kids have put more than 10,000 hours into the product, so I think there is a competency base to grow from.

Can you tell us how you're going to or how you're able to help the industry help the people who live in all of our ridings, the people who have put the 10,000 hours of effort in and who want to be employable in this huge-growth, exciting industry?