Transport Committee on Nov. 2nd, 2022

[The Chair, Liberal, Peter Schiefke]

I call this meeting to order.

Welcome to meeting No. 37 of the Standing Committee on Transport, Infrastructure and Communities.

Pursuant to Standing Order 108(2) and the motion adopted by the committee on Thursday, February 3, 2022, the committee is meeting to study anticipated labour shortages in the Canadian transportation sector.

Today’s meeting is taking place in a hybrid format, pursuant to the House Order of November 25, 2021. Members are attending in person in the room and remotely using the Zoom application.

Members of the committee, we have appearing before us as witnesses via video conference in the first hour, from the national supply chain task force, Monsieur Jean Gattuso, task force co-chair, as well as Louise Yako, task force co-chair.

In the second half, from 5:30 to 6:30, from the Department of Citizenship and Immigration we have Jean-Marc Gionet, director general, immigration program guidance, and Ian Gillespie, director, temporary resident policy and programs.

From the Department of Employment and Social Development we have Mr. Andrew Brown, senior assistant deputy minister, skills and employment branch; Mr. Michael MacPhee, assistant deputy minister, temporary foreign workers program; and Mr. Brian Hickey, director general, temporary foreign workers program.

Finally, from the Department of Transport we have Ms. Melanie Vanstone, director general, multimodal and road safety programs.

Before I begin, I'd like to take this opportunity to inform members that all of today's video conference witness participants have completed the necessary audiovisual checks.

We will now begin the opening remarks with the national supply chain task force for five minutes.

The floor is yours.

[Louise Yako, Task Force Co-Chair, National Supply Chain Task Force]

Good afternoon, everyone. It's a pleasure to be speaking to you today.

Monsieur Gattuso and I would like to thank the committee for the opportunity to speak about the national supply chain task force's report. We are proud of the work the task force did over its 100-day mandate. Our objective was to provide independent advice through recommendations on actions aimed to increase competition, access, reliability, resiliency, redundancy, efficiency and investment in the national transportation supply chain, while also promoting continued international transportation services to and from Canada.

The recommendations developed are based on the perspectives shared by industry through consultation and written submissions. We were also guided by the principle of creating a transportation supply chain that would be governed and operated in the best interests of the country, given Canada's reliance on international trade for our prosperity.

With respect to the objective of the TRAN committee, today we will share what we heard from industry about the labour shortage impacting the national transportation supply chain and the recommendations related to addressing these challenges that we provided to the Minister of Transport in our final report.

One of the key structural issues identified through our consultations with industry is that the transportation sector is facing acute labour shortages. While they are an issue for all transportation modes, they are particularly problematic for the rail and trucking sectors. To give some perspective on the scale of this issue, as noted by the Conference Board of Canada, the transportation sector is more reliant on older workers compared to the total economy, and more than 260,000 of its workers will be retiring in the next 20 years. Moreover, from 2021 to 2030, the number of workers joining the transportation workforce will be insufficient to offset the losses from retirees.

The transportation sector relies inordinately on immigrants, and its current workforce is predominantly male. We heard that the labour issues facing our supply chain system are complex and cannot be tied to a single broken cog in the system. A mismatch between available and required skills, lack of appropriate training programs and insufficient training funding were consistently raised as significant concerns by various supply chain representatives. They also mentioned lack of awareness of certain occupations as being particularly problematic.

Labour shortages are a pressing issue across all sectors. We have seen that when the transportation sector is not functioning properly, products do not make their way to consumers, materials do not make their way to producers, and notably the follow-on impacts affect all Canadians.

A key example of this dysfunction is that 50% of our trade is dependent on trucking, and we are missing more than 25,000 drivers. Further, there is not a collective view that trucking is a skilled trade, which dissuades potential candidates and impacts training funding. Trucking is just one example of the system not being set up to effectively attract and retain talent.

[Jean Gattuso, Task Force Co-Chair, National Supply Chain Task Force]

A reliable and efficient supply chain is critical to the economic well-being of our country. I repeat: it must be reliable and efficient.

The transport sector is responsible for facilitating trade, which comprised 61% of Canada’s GDP in 2021, a year in which the supply chain suffered significant reductions in service due to human-caused mischief and natural disasters.

Regardless of the advancements being made through automation and artificial intelligence, stakeholders believe labour will continue to be a limiting factor for a reliable and efficient supply chain unless drastic measures are taken.

To respond to these issues we have consistently heard that collaboration among all levels of government and the private sector should be prioritized to better understand labour market needs across the country and to meet current and future workforce requirements.

Collaboration between the public and private sectors was seen as an opportunity to advance and promote education and skills training in supply chain-related occupations. This collaboration would also have to involve provinces and territories as education and training fall under their jurisdiction.

Taking into account the struggles and suggestions from industry, our final report contains both immediate actions and long-term recommendations that reflect what we heard.

In the short term, within two years, we have recommended that the government develop a transportation supply chain labour strategy to identify current issues and develop long-term and lasting solutions.

Additionally, we have brought forward other immediate actions that the government could pursue to provide some immediate relief. These include that the federal government seek to expand existing labour programs and examine a way to attract under-represented groups; continue to support and, if possible, expand the temporary foreign worker program on an urgent basis as it applies to workers in the transportation supply chain; expedite refugee and immigration processing for those eligible to work in supply chain-related businesses; and finally, support organizations and businesses to help acclimatize new Canadians to Canadian work and social environments.

Looking to the long term, we recommend that the government finalize the transportation supply chain labour strategy and, at a minimum, include direction related to immigration, domestic labour participation, refugee training and education, productivity and automation.

The strategy should reinforce the government's willingness to adapt policies, remove barriers, provide adequate training, embrace collaboration, promote the continuous growth and upscaling of our workforce, and invest in our businesses to take advantage of technology.

Our final report provides further details on each recommendation and the nuances of the problems faced by the supply chain system.

While labour is only a single component of our final report, we would like to thank you for giving us the time to share our findings on the matter. We look forward to any questions you may have.

Thank you.

[The Chair, Liberal, Peter Schiefke]

Thank you, Mr. Gattuso.

Thank you very much, Ms. Yako, for your opening remarks.

We will begin our line of questioning with Mr. Jeneroux.

The floor is yours. You have six minutes.

[Matt Jeneroux, Conservative, Edmonton Riverbend, AB]

Thank you, Mr. Chair.

It's good to be back and see everybody at the transport committee. I really appreciate your showing up.

I want to ask a quick question out of the gate. There are 13 immediate recommendations. During your press conference and subsequent media interviews, there were a lot of comments, particularly by you, Ms. Yako, that they are urgent.

Of those 13, have you seen action on all 13 so far from the government?

[Louise Yako]

We submitted our report early in October. The government has no responsibility to report back to Jean and me, so—

[Matt Jeneroux, Conservative, Edmonton Riverbend, AB]

I'm sorry to interrupt, but I have only a limited amount of time.

Have you witnessed it? I imagine you're still paying attention and closely monitoring what's happened from your report.

[Louise Yako]

I'm aware that Transport Canada has asked for submissions from stakeholders, but I have not been watching this particularly closely. It's something I can't comment on.

[Matt Jeneroux, Conservative, Edmonton Riverbend, AB]

Perfect. Thank you. I will move on.

The report states, “Roadblocks to private sector innovation must be removed...We must ensure that governments do not place barriers that could stifle this type of much-needed innovation.”

One recommendation of the report is to create the supply chain office. The majority of the task force recommendations focus on government intervention versus getting government out of the way.

I will ask the question, and hopefully you can provide some insight on it. Do you really think we need to create a new office that will, obviously, cost taxpayers more and will likely lead to more Ottawa interference?

[Louise Yako]

I can see that Jean is answering.

[Jean Gattuso]

I'm here, Louise. I'll take over this question.

First, going back to government, you saw governments in the last few days taking a position on immigration. That's one thing we were pushing in our report when we were talking about labour. We heard from the stakeholders that we need more immigration.

Going back to your question on the supply chain office, when you look at what we lost in the last 10 years in terms of shared trade in the world, especially with the U.S.—three share points—you could easily pay the supply chain office and get results. When you start losing shares, you need immediate action.

Remember that the objective of the supply chain office is making sure that within different departments of the government there are KPIs that are oriented to supply chains. One of the basic things in this report is that trade is important. It's 61% of GDP.

If we start losing shares, Canadians will be affected by it.

[Matt Jeneroux, Conservative, Edmonton Riverbend, AB]

Thanks, Mr. Gattuso.

First of all, I probably should start with commending you guys on the report. A lot of hard work and a lot of time have been put into this report.

The one stickler that I keep hearing about is the supply chain office. I spoke with somebody today who said they're unsure how more government bureaucracy will continue to help the problem. They looked further down the road and saw that this would be an additional burden. That's the concern, at least, that I'm hearing.

I'm going to move on to my next question, but if there's more to add to that, Mr. Gattuso, I'd welcome you to chime in.

Obviously, the railways and ports are owned and operated by the private sector. An outcome that's seen from your report is that there seems to be more incentivization from the government for the creation of additional rail lines and ports.

Is that a fair comment?

Maybe we'll start with you, Ms. Yako. Is that your interpretation of what you heard?

[Louise Yako]

We heard that physical infrastructure is required, but it's not physical infrastructure alone that is going to solve our supply chain issues. It is going to be additional co-operation between the private sector and government.

To go back to your earlier question about the supply chain office, there is a need for better federal coordination among the departments, because there are a number of federal departments that touch and affect supply chain operations and that have policies that affect supply chains, and there's currently a lack of coordination. Rather than an additional layer of bureaucracy, we see the supply chain office as cutting through some of that bureaucracy and, potentially, taking over responsibility. This is so there's not an add-on effect, necessarily, but more efficiency in how those regulations that affect supply chains are developed, monitored and managed.

[Matt Jeneroux, Conservative, Edmonton Riverbend, AB]

Mr. Gattuso, do you want to get in on the supply chain office?

[Jean Gattuso]

To add to Louise's comments, it is key. Many departments touch the supply chain, and they play a role in it. If you talk about the borders, as an example, and the CFIA, it's key for them that we also put KPIs in their performance, because the supply chain office brings together all the KPIs. Because we are a trading country, we also need to continue to grow our business and maintain our supply chain.

Remember, our project was to have an efficient and fluid supply chain. That was our mandate, so we came up with this recommendation. It's key in our report.

[The Chair, Liberal, Peter Schiefke]

Thank you, Mr. Gattuso.

Next, we have Mr. Rogers. The floor is yours. You have six minutes.

[Churence Rogers, Liberal, Bonavista—Burin—Trinity, NL]

Thank you, Mr. Chair, and thank you to the witnesses appearing today. It's good to have you here.

First of all, I should commend you on some great work in your report on the long- and short-term recommendations as we try to resolve the supply chain issues.

We've heard from many different witnesses over the last number of meetings. They're from all sectors of the transportation corridors, the airline industry, marine industry and trucking, and all the people who are involved in moving goods and services for our country.

I want to ask you this question. Either one of you can feel free to comment on the questions I ask.

In your view, after all the work you've done, is the shortage of truck drivers the biggest problem in the transportation sector, or do you see other shortages as equally problematic? If so, which ones are they?

[Jean Gattuso]

We have identified trucking. Fifty per cent of our trade depends on trucking, so if we're missing 25,000 drivers, and trucking is key, then.... You have 23% that is maritime labour in the port, and you have 12% that is rail. If you take just rail and trucking, you have 62% of our trade that depends on those, so those sectors are key.

Don't forget that our internal and external customers look at this country as being a big plant. We need to service internal and external customers. If we don't give our external customers service, they won't buy from Canada anymore. We need to make sure that from the plant to the port or to the U.S., we meet the requirements of our customers. If there are delays for weeks and weeks, people will not buy from Canada anymore.

We heard things like that from the stakeholders. We met people. They were talking about their customers. The U.S. is also challenging us. We spent one week in the U.S. talking about the type of service Canada is giving.

[Churence Rogers, Liberal, Bonavista—Burin—Trinity, NL]

Ms. Yako, do you want to add to that?

[Louise Yako]

I think your question is this: Is there a ranking in terms of the shortages for the particular modes? While Jean is absolutely correct that we have a very significant shortage of truck drivers, each mode serves a specific purpose, and each mode has identified labour shortages as being critical. I wouldn't necessarily rank one over the other. I'd say they're all very significant. They're all critical and necessary to be filled.

[Churence Rogers, Liberal, Bonavista—Burin—Trinity, NL]

Given your comment there, can you comment on recent changes to the temporary foreign worker program? Do you think this will help address labour shortages in the transportation sector?

[Louise Yako]

The temporary foreign worker program is designed for temporary shortages. By definition, the shortages that we are talking about are long-term and significant. They require a permanent solution. While the increase in temporary foreign workers may provide a short-term bridge, we require a much longer-term perspective on labour shortages.

[Jean Gattuso]

Don't forget that if you're talking about drivers, you need to train them. It's a process. Driving is not recognized right now as a profession, and in terms of adding something, you saw in our report that we're pushing for a program and for the federal government and the provinces to work together. We need to train drivers.

For sure, these people who are coming in cannot be temporary. Therefore, it's key to also get drivers into this country through our immigration program.

[Churence Rogers, Liberal, Bonavista—Burin—Trinity, NL]

The other question I have is about automatization. Did you identify opportunities for greater automatization to help deal with labour shortages? If so, can you elaborate on that?

[Louise Yako]

We didn't specifically identify situations in which automation will be helpful, but clearly vehicle automation is a key area that is expanding, so there may be some automation. The rail lines have identified ways they could automate inspections, for example, but there are regulations in place that prohibit them from doing that.

There are opportunities that were identified by stakeholders. We didn't necessarily identify them specifically in the report.