Canada Amid Worst Labour Shortage in 2018

According to the CEO of the Canadian Federation of Independent Business (CFIB), Dan Kelly, this is Canada’s most severe labour shortage since the onset of the financial crisis.[1]

Companies across Canada now face labour shortages, with service workers and construction workers are in the high demand.[2] The labour shortage is especially troublesome for small companies, where each employee represents a significant portion of the company’s work force. Businesses facing labour shortages are compelled to raise employee pay.

More than 1.1 million people are on the unemployment roll in Canada. Labour immobility is a major factor contributing to Canada’s labour shortage. According to Statistics Canada, the annual rate of interprovincial migration has fallen by more than half since the early 1970s. [3] Canadian today place great priority on their families and social circles, making them less wiling to move.

Ted Mallett, vice president and chief economist at CFIB, believes that policymakers could help address the problem by aligning standards across provinces making it easier for licensed professionals to get accreditation in other provinces and have an incentive to move. Canadian businesses reported 468,000 job vacancies in the third quarter, with Quebec and British Columbia leading the job vacancy growth rate. [4]

So where does this labour shortage leave Canada? Should employers hire more foreign workers who are willing to accept low wages? Or should they attract the Canadian work force by providing better wages.



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