Thank you, Mr. Chair and committee members.
I am pleased to join you today to provide an overview of labour and skills shortages in the Canadian economy.
Labour market pressures are affecting practically all sectors of the economy and regions of the country. As of January 2022, there were more than 800,000 job vacancies across Canada, which is still significantly higher than prepandemic levels.
Sixty-two per cent of current vacancies are in jobs that require high school or less. Many of these vacancies are expected to be cyclical and filled in a post-COVID economy. For instance, the number of vacancies in accommodation and food services is now half of what it was last summer.
Other shortages are a result of structural factors, such as an aging population and rising skill requirements. This is increasing job vacancies in key sectors such as construction; professional, scientific and technical services; and health care. These vacancies will take longer to fill, given the scarcity of highly skilled workers among the unemployed and the need for specialized training.
Small and medium-sized enterprises, SMEs, were severely impacted by the pandemic and recorded the largest decline in the number of employees in spring 2020.
Automation, digital innovation and a transition to a low-carbon economy are also driving key shifts that present opportunities for all Canadians. The need for skills, including digital skills, to support the changing economy has never been so strong. For example, jobs to support the low-carbon economy are expected to increase at three times the rate of total employment.
There are three potential sources of labour supply in Canada: one, new entrants to the labour market, which are primarily youth and immigrants; two, groups under-represented in the labour market; and three, individuals already working who need upskilling and re-skilling to adapt and stay in the labour force.
To address labour shortages facing the Canadian economy, it will be necessary to maximize all three sources of labour.
Youth are the biggest source of new entrants to the labour market, with 4.9 million young jobseekers expected to enter the workforce by 2028.
The next source of labour market supply is from immigration. However, accessing this supply of labour will require addressing barriers many newcomers face to securing jobs, including English or French proficiency, difficulties in obtaining recognition of their credentials and a lack of Canadian work experience.
While temporary foreign workers will play a critical role in filling jobs in the agriculture, food and fish processing sectors—in fact, 80% are working in agriculture—it is important to underscore that they make up only 0.4% of the labour force.
Another source of supply is under-represented groups. Increasing the participation rate of women, indigenous people, persons with disabilities and visible minorities in the workforce could add over two million new workers to the labour market.
Finally, three-quarters of the labour force of 2028 is already working. This is critical context, as labour shortages are not a purely a numbers issue but also a skills mismatch or a skills shortage issue.
As the skills required for jobs continue to rise with the introduction of new technologies, most workers will need to upgrade their skills. As some jobs disappear, it will be important for workers to have access to training to upskill and re-skill so that they can fill new and emerging opportunities in other sectors. To this end, the Government of Canada has taken concrete measures to help reduce shortages and support SMEs.
To help ensure employers can quickly bring in workers to fill short-term labour market gaps, budget 2022 proposes to introduce a trusted employer model to reduce red tape for employers hiring temporary foreign workers, at $29.3 million; a new foreign labour program for fish and agriculture, at $48.2 million; improvements to employer inspections, at $14.6 million; and increased capacities for processing employer applications, with $64.6 million.
Budget 2022 also allocates $115 million over five years, with $30 million annually, to expand the foreign credential recognition program and help up to 11,000 skilled newcomers per year, including internationally trained health care professionals, get their credentials recognized and find work in their field.
We will continue working collaboratively with our federal partners and counterparts in provincial and territorial governments to help alleviate current and future labour market pressures.
Thank you.