Evidence of meeting #13 for Industry, Science and Technology in the 42nd Parliament, 1st Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was need.
A recording is available from Parliament.
Liberal
Liberal
Lloyd Longfield Liberal Guelph, ON
It is great to see both large organizations here to help us with our manufacturing study. We are just beginning this and, again, we are focusing on manufacturing, so I am going to relate my questions to some of the pillars we are looking at within the budget that is before the House of Commons right now.
The budget is being presented as leading to “a more innovative Canada”. How do we create jobs within the middle class, in this case relating to manufacturing? My favourite page of the whole document that is in front of the House is page 110, which gives the pillars of investment: creative and entrepreneurial citizens; science and technology; innovation infrastructure; and supportive business environment for commercialization and growth.
I want to focus on the first pillar, which is “Creative and Entrepreneurial Citizens”.
Mr. Smith, you mentioned in your presentation the opportunities for students. We are looking at federal tools to help support internships and youth work experiences, such as apprenticeships, as well as trying to improve the immigration policy. Could you expand on the Chamber of Commerce network's take on how we develop that important asset in the innovation agenda, in terms of developing our workforce?
Director, Intellectual Property and Innovation Policy, Canadian Chamber of Commerce
There are a couple of things. You mentioned immigration. We had something called the temporary foreign worker program. That had some challenges with it. It wasn't a perfect program, if you could even call it a program. The way the chamber looks at it is this. Why would we turn away the highest and best people, the skilled people we need for specific jobs?
For instance, if you have a proposal from a company for billions of dollars of investment coming in to support a specific industry, on the condition that they can bring the people they need to do those jobs, why would you say no? If the individuals are not available here in this country, why would you say no to that? It is important to make sure that you have the right people with the right skills. My boss uses this example: If the best goalie in the world is from Sweden, and he is going to go play for the Leafs, would you say no?
Liberal
Lloyd Longfield Liberal Guelph, ON
Thank you. I am going to get to Mr. Burt in two seconds. I just want to extend that a bit, in terms of the chamber.
As you know, I have been a member of the chamber network for many years, and I know that this issue has been on the agenda, in terms of literacy, numeracy, and digital skills that are limiting our productivity. How do we, as a federal government, help to build the literacy, numeracy, and digital skills? Just for our report, we need to try to gather information.
Director, Intellectual Property and Innovation Policy, Canadian Chamber of Commerce
There are a couple of things. You asked how do we bring industry and the education system closer together? I think part of the answer is to start young and make sure those skills are taught at the entry levels, in elementary school.
In terms of digital literacy, if you follow the example of Germany, Switzerland, and Israel and the apprentice programs that exist there.... I am not sure they call these apprentice programs, but they are essentially such programs, where people are integrated into the workplace directly while they are still in school.
Liberal
Lloyd Longfield Liberal Guelph, ON
Great, thank you.
Mr. Burt, the Conference Board of Canada has looked at productivity and the productivity gap that is growing in Canada. I think we have slid from 15th to 22nd now, and it is not improving. What investments in productivity do you see? Complementing what we are talking about, developing skills, but also.... We have heard that there is a lot of cash in Canadian businesses that isn't being invested in equipment. Has the Conference Board of Canada looked at that?
Director, Industrial Economic Trends, Conference Board of Canada
There is no doubt that we could invest more. For example, if you look at the rate of investment in information and communication technology relative to sales for Canadian businesses, it is almost half of what we see with our neighbours to the south. We are not making full use even of the technologies that are available out there right now, so that is a key thing.
Broadly speaking, I don't know how we incent businesses.... Oh, you asked about cash. That was the other thing I was going to talk about.
Right now, cash levels are elevated in businesses, compared to what we would have seen prior to the financial crisis. It is not clear how much of that is due to concerns about access to cash, because there were shortages of that prior to the financial crisis.
Liberal
Lloyd Longfield Liberal Guelph, ON
Quite possibly some programs to help free that cash into the economy to create the middle-class jobs that they're trying to create....
Director, Industrial Economic Trends, Conference Board of Canada
At least assurances around businesses that they will have access to cash when they need it if another financial crisis comes....
Liberal
Lloyd Longfield Liberal Guelph, ON
In our budget and in terms of our strategy going forward, there are six sectors that we've been focusing on investing in. We're looking at clean technology, health care, advanced manufacturing, digital technology, resource management, and agrifood. You mentioned agrifood a couple of times in your presentation, and also advanced manufacturing, automotive, aerospace. You've mentioned plastics.
We're trying to peel-in on a manufacturing strategy. In Guelph, we see that 26% of our workforce is in advanced manufacturing, and about another 20% of our workforce is in food and agrifood. We see those as two key areas that we need to develop, but our employers are having trouble getting access to talent. They're growth restrained—
Director, Intellectual Property and Innovation Policy, Canadian Chamber of Commerce
I'll just reiterate what I said about immigration and the express entry idea where you can bring in the people who you need, and it's not just on the technical side. I think we need to look at the sales and marketing side as well.
We need the talent to be able to grow our companies, and if it doesn't exist here, we need to be able to look for that and bring it here.
Conservative
Ben Lobb Conservative Huron—Bruce, ON
I agree with a lot of what you have to say.
The real question on the actual manufacturing.... If you look at, say, the large auto manufacturers, or even the assemblers, the labour agreements that they have struck with Unifor, or any other union, I think that at this point in time they've both done as well as they're going to do. In my discussions with Ford and GM, electricity is said to be one of the big hindrances moving forward with any growth in capacity, specifically in Ontario.
Really, what can manufacturers do? I used to work for a foundry, and that's all electricity, and I guess raw input. Steel mills in Hamilton would have the same experience with high electricity costs.
What way around that is there?
Director, Industrial Economic Trends, Conference Board of Canada
We've talked about the cost of electricity. It's definitely a problem. There are really two things you can deal with if you're not happy with the price you're paying for electricity.
One, try to find ways to improve your efficiency. There are many examples of businesses that, actually, when they sat down and tried to audit how they're spending, where their electricity is being used, they can find ways to cut back significantly.
The other thing that we've seen a lot of manufacturers do is move increasingly towards co-generation, where they basically generate their own electricity, maybe even more than they need, and are selling it back to the grid. So that's another way that manufacturers can try to address it.
Broadly speaking, it's not just true of electricity. I've seen many manufacturers, if they're having a problem with a supplier, move down the supply chain and actually get into that business themselves.
Conservative
Ben Lobb Conservative Huron—Bruce, ON
On co-generation, obviously the only people who are going to look at co-generation are the ones who have already invested the tens or hundreds of millions of dollars in plant equipment in the country. No new business is going to set up shop and say, “Oh, by the way, you have to do co-generation.” That's probably not in the—
Director, Industrial Economic Trends, Conference Board of Canada
It's a reality in the forestry industry right now. If you want to build a saw mill in Canada, you pretty much have to build a co-generation plant.
Conservative
Ben Lobb Conservative Huron—Bruce, ON
Well, okay, but I was thinking more on the manufacturing side than the saw mill.
Director, Industrial Economic Trends, Conference Board of Canada
Well, that is a manufacturing side.
Conservative
Ben Lobb Conservative Huron—Bruce, ON
On the temporary foreign worker side of things, from both of your outlooks, is it a short-term solution? I understand the highly-skilled people, the C-level executives, who have to come in and conduct themselves in this country. No one around this table is going to question that. But, say, for example, it's the person who's working in a turkey sausage processing plant or in a large-scale processing plant in this country. In your opinion, are temporary foreign workers a long-term solution or a short-term solution?
Director, Industrial Economic Trends, Conference Board of Canada
Most of the businesses I've spoken to about temporary foreign workers would be happy to find ways to transition them to permanent status. They are happy with these people; they want them there. The problem often is that the programs that are in place to move those people from temporary to permanent status are not well adapted to their needs.
A lot of our permanent immigration programs are aimed at people with university degrees, high-skilled workers, and many of the temporary foreign workers we're bringing in are not necessarily in that category. If they could transition them into permanent status, I think many employers would.
Conservative
Ben Lobb Conservative Huron—Bruce, ON
The unemployment rate is 7% across the country. There are many workers who have given up hope altogether. There are people who are on social assistance of one form or another, who would simply love to have the chance to tune up their skills a bit, to improve themselves a bit, to give themselves a shot to get their foot in the door. Is this something that the government should look at through the EI program, to bring some of these people up—instead of handouts, give them a hand up, retrain them, and get them back into the workforce?
I get your point about bringing in temporary foreign workers, but when we have people at home wanting a chance, shouldn't we take a look at them first?
