Question Period Note: Labour Shortages in Canada

Labour Shortages in Canada

We know that Canada’s economic growth is outpacing the ability for many employers to find workers.

The federal government has a robust suite of programs and partnerships to help address labour shortages, and ensure that Canada has a diverse and skilled workforce that can thrive in a rapidly evolving labour market.

The government is working to maximize the labour market participation of underrepresented groups, including women, persons with disabilities, Indigenous peoples and racialized Canadians. The government is also looking to support youth, increase immigration levels, and help employers find the talent they need to keep our economy growing.  

Prior to the pandemic, Canada’s economy was performing strongly with historical records for job growth and unemployment. However, while many Canadians were doing well, global shifts toward greener, digital economies, automation and changing skills requirements in the workplace were transforming the Canadian labour market. A rapidly aging population was also affecting labour market growth.

In response to these trends, the Government focused on enhancing skills for middle class jobs, improving labour market outcomes for underrepresented groups and modernizing employment supports.

With the start of the pandemic in 2020, the Government took bold, unprecedented actions to support Canadians and the economy. To safeguard the health, safety and financial security of Canadians, the Government introduced a suite of recovery benefits, including the Canada Emergency Response Benefit and the Canada Emergency Student Benefit, as part of the COVID-19 Economic Response Plan.

In parallel to these emergency response efforts, the Government continued to address the challenges of the evolving economy through major investment in Budget 2021 to support workers.

As the labour market recovers from the pandemic, pre-existing workforce challenges, including a rapidly aging population, global shifts toward greener, digital economies, automation, and evolving skills requirements are transforming the Canadian labour market.

In June 2022, there were over one million job vacancies reported nationally, almost double the number prior to the pandemic. Labour market pressures are affecting practically all sectors of the economy and most regions of the country.

Sectors with the highest numbers of job vacancies in June 2022 include accommodation and food services (171,715), health care and social assistance (149,665), retail trade (114,355), construction (89,870), manufacturing (82,785), professional, scientific and technical services (72,225), and transportation and warehousing (51,000).

Acute shortages in key sectors such as health care, agriculture and agri-food, professional, scientific and technical services are especially concerning as they may adversely affect future economic growth, and Canadians’ standard of living, health, access to food, and safety. Many of these shortages will take time to fill given high educational and training requirements.

While market forces, technology adoption and improved business productivity levels may reduce some pressures, the government has a role to play in supporting partners to address shortages, build our economy and prepare the workforce for the labour market of the future.

To address current and future labour market pressures, the federal government is leveraging and realigning foundational programs and initiatives, targeting new investments and working with all partners, including employers, unions, Indigenous communities, and provinces and territories (P/Ts). This will ensure that job seekers and workers have access to the training and supports required to thrive in today’s and tomorrow’s labour market, and businesses have access to the talent they need to grow.

Closing the gap in the labour market participation rate of equity deserving groups is also part of Canada’s response to addressing workforce challenges. Increasing the participation of women, persons with disabilities, Indigenous peoples and racialized Canadians in the workplace could add over two million new workers to the labour market.

The LMTAs and EI are the building blocks of Canada’s labour market programming. As the Government of Canada’s single largest investment in training, the LMTAs reach over one million Canadians across the country and deliver flexible, regionally adapted employment and training supports. EI is a key social safety net supporting Canadians in times of career and life events. Along with the CTB, key improvements in these programs will support the government’s commitments to help Canadians obtain the skills they need to find and keep a good job, and to build an inclusive, resilient economy.

The federal government is positioned with the tools and partnerships to support Canada’s labour market in order to alleviate labour shortages, build an inclusive society, and drive continued economic growth for years to come.

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