A recent report from the Canadian Manufacturers and Exporters (“CME”) found that almost 50 percent of Canadian manufacturers suffer from immediate labour shortages.

The CME study specifically found that the ability to attract and retain skilled workers represented one of the greatest challenges to manufacturers across Canada.  Specifically, skilled labour shortages, along with the high value of the Canadian dollar and competition from other manufacturers represented the top three concerns of Canadian manufacturers.

CME president stated that the survey demonstrated that the ability to find skilled workers was of such concern to manufacturers that it would likely be a major factor for companies in determining the extent to which they will invest in the Canadian economy moving forward. 

What is perhaps the most surprising finding of the study is how deep and wide skills shortages run in manufacturing.  Specifically, the study demonstrated that a wide range of skills are in severe shortage and are likely to become even scarcer over the next five years.  These areas include general management, engineering, sales and marketing, and skilled production. 

The CME study also demonstrated that skilled labour shortages are already having a serious and sustained impact on the manufacturing sector.  Specifically, many companies have been forced to reduce the rate of growth of their operations in Canada and instead move production abroad because of a chronic inability to find the necessary skills to support innovation and growth.

The study has also led to projections that if the skilled shortage problem is not solved that over the next five years least one third of Canadian manufacturers will begin to move production outside of Canada.

What does this means for employers?

The CME study serves as further evidence that Canada continues to struggle to fill labour shortages across a wide range of industries. This is a major concern, particularly given Canada's  almost unimaginable abundance of resources. Specifically, as the world economy continues to grow and the wealth of developing nations increases, everything Canadian will be in higher and higher demand.

Managing this growth will require a range of tools, including better training of Canadians to ensure that the unemployed and students are provided the skills to succeed through filling present and future labour market needs. The strategy however will also require elevated levels of temporary foreign workers and permanent residents entering Canada who have the skills necessary to nurture Canada’s growth.

Given the current trends, employers would be wise to become familiar with programs designed to address labour shortages, including the Temporary Foreign Worker Program, which facilitates the entry of foreigners to Canada so that companies can quickly find the skills needed.  A holistic approach can help to ensure that Canadian innovation continues to prosper.