Thank you, Mr. Chair.
I'd like to thank the committee for the opportunity to speak today about anticipated labour shortages in the Canadian transportation sector.
The FMA represents purchasers of freight transportation in Canada, including rail, marine, air and trucking. I hope I'm in the right meeting, because I will be speaking about rail and trucking labour issues.
Like other G7 countries, we have an aging population and a low birth rate. Our recent COVID experience has highlighted the reality that there are not enough skilled workers to fill all vacancies. Coupled with the pandemic, work-life balance has become a more important factor for workers. Salary alone is no longer a chief motivator.
How is this affecting transportation services and the supply chain? We have all experienced the supply chain chaos that was exacerbated by COVID. At the beginning of the pandemic, Transport Canada deemed both rail and trucking services to be essential. Truckers and rail workers helped Canada continue to function during COVID by continuing to move vital food, fuel, PPE, chemicals and other necessary materials. Without this transportation service, the effect of the pandemic would have been much worse.
Even though transportation workers performed admirably and the job got done, there are two main labour problems.
First, we have an aging workforce. Generally, the baby boomers who powered the economy through the 1980s, 1990s and 2000s have left the workforce or are retiring en masse. There are not enough skilled workers to adequately replace them. Not everyone can work from home.
The truck driver shortage continues to be a problem. The Conference Board of Canada now finds that the average truck driver's age is 46 years, compared to the average for all workers, which is 41.5 years. The industry needs to attract younger workers. It's estimated that there are 23,000 driver vacancies right now, and that will go up to 56,000 by 2024. This does not bode well for the Canadian economy, going forward.
In the rail industry, rail crew and locomotive shortages—not railcars—are recurring problems through periods of negative network fluidity. There is a great concern in the shipper community that the above-average grain crop this year, the coming winter and the staff shortages will create chaos on the rails, going forward.
The second employment issue is a changing attitude toward work. Workers are looking at work differently today from how they did in the past. COVID did not cause this change, but it has certainly sped it up. Working from home, virtual meetings and the demand for a better work-life balance are issues currently on the table.
Employee turnover in the trucking sector is very high—around 70%. Drivers routinely leave their employer or the industry. This turnover can be attributed to long hours, pressure to deliver, poor food and rest conditions on the road, and lack of recognition and appreciation.
In the rail industry, the practice of precision scheduled railroading, operations focusing on sweating the assets, does not apply only to equipment. Staff is cut to a bare minimum, resulting in increased pressure on the employees who are left.
In the U.S., railways and unions are currently working out their labour agreements. Although wages will go up 24% over the next three years, some union members are not ratifying agreements, because they say management holds no regard for their quality of life—illustrated by their stubborn reluctance to provide a higher quantity of paid time off, especially for sickness. Employees feel management is more concerned about operating ratios and profits than workers' well-being. It's no wonder they can't find anyone to employ.
What are the possible solutions?
One way to increase the number of workers available in the short term is by increasing immigration. I understand this solution may not be that simple, but it is worth the effort. Let’s remember that Canada is a country built with the help of people from many places.
Pay an hourly wage to truck drivers, which will prioritize safety, thereby reducing the “need to get there at any cost” mentality. Require new energy-efficient trucks and encourage digitalization of the industry. Make trucking a skilled trade; many trades require an apprentice program and mentoring, especially in Europe. Make trucking a vocation instead of a default career. Ensure there is sufficient funding for the infrastructure necessary for the future. Ensure there are more safe places for drivers to eat and rest.
Railways need to be more cognizant of the labour market realities and their customers’ service requirements when downsizing their workforce in response to temporary volume downturns. Excessive cuts followed by deliberately slow restaffing should not be an option. Leave some slack in the system, and make the supply chain more resilient.
Provide better working conditions for rail workers, with less punitive action for legitimate time off. Having more workers working fewer hours results in safer working conditions and a happier and therefore more productive workforce.
Thank you very much.