Fact Sheet

The Skills Shortage

• Canada is beginning to feel the affect of a shortage of skilled tradespeople.
  • Almost 50% of businesses surveyed in 2003 said a shortage of qualified labour was one of the most important issues facing them. Moreover, 56% of firms said they were forced to hire people even though they were not suitable and almost 30% said they had foregone business opportunities (Canadian Federation of Independent Business, 2003).
  • Canada is already short between 25,000 and 60,000 workers (Canadian Construction Association. Available at: http://tradeability.ca/DesktopDefault.aspx?TabId=3449&Lang=en ).
  • The Canadian Federation of Independent Business said the existing skills shortage among smaller businesses was already as high as 300,000 in 2001 (Source: Beauchesne, "Record numbers sign up for apprenticeship training," Ottawa Citizen, Times Colonist, The Telegram, November 21, 2003. Available at: Canadian Labour and Business Centre http://www.clbc.ca/media_room/).
  • In the construction sector, the total labour force declined by about 12,000 or 1.4% (Source: Julie Ann McMullin, Marine Cooke, Labour Force Ageing and Skill Shortages in Canada and Ontario, Canadian Policy Research Networks, Ottawa, August 2004).

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• The shortage of skilled tradespeople will worsen in the future if not immediately addressed.
  • In the next two decades, 40% of new jobs will be in the skilled trades and technologies. In 1998, that number was less than 20% (http://www.skillswork.com/students/coolfacts.html).
  • In Canada, the shortfall has been estimated at no fewer than 20,000 unfilled jobs, growing to 50,000 by the year 2010 (Information Technology Association of Canada Information Technology Association of Canada: http://www.skillswork.com/students/coolfacts.html ).
  • By 2020, it is estimated that Canada could be short about 1 million workers due to an ageing population and declining birth rates (Conference Board of Canada, 2000).
  • The percentage of workers aged between 55 and 64 years, who are nearing typical retirement ages, rose from 8.6 percent to 9.6 percent between 1991 and 2001 (Julie Ann McMullin, Marine Cooke, Labour Force Ageing and Skill Shortages in Canada and Ontario, Canadian Policy Research Networks, Ottawa, August, 2004).
  • The first baby-boomers are due to reach retirement age by 2012. In 2015, almost half the workforce (48%) will be between the ages of 45 to 64. By 2026, more than half the population will be over the age of 43 (CFIB, 2003).
  • In the steel industry, 45% of all tradespeople are expected to retire by 2006 (CFIB, 2003).
  • In the manufacturing sector, there is an estimated 400,000 workers required in the next 15 years due to retirement (Canadian Labour and Business, 2004).
  • 50,000 skilled metal trades' people will be needed in the next five years (Canadian Tooling and Machining Association. Available at: http://tradeability.ca/DesktopDefault.aspx?TabId=3449&Lang=en ).
  • Between 18,000 and 19,000 new jobs will be created within the next 5 years in the collision industry (Canadian Collision Industry Forum. Available at:
    http://tradeability.ca/DesktopDefault.aspx?TabId=3449&Lang=en ).
  • Canada's automotive industry will need 30,000 new skilled workers by 2005, due to retirements (Automotive Parts Manufacturing Association. Available at:
    http://tradeability.ca/DesktopDefault.aspx?TabId=3449&Lang=en ).
  • The Automotive Parts Manufacturers Association forecasts a 42% vacancy rate for skilled trades by 2007 -- nearly 34,000 jobs but only 20,000 skilled workers will be available (http://www.skillswork.com/students/coolfacts.html).

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• Regional skills issues.
  • 11.8 percent of Ontario workers were aged 55 or over in 2001, Newfoundland and Labrador had a somewhat younger age structure with 9.6 percent of workers aged 55 and over, and British Columbia had the oldest labour force in Canada, with 12.7 percent aged 55 or over (Source: Julie Ann McMullin, Marine Cooke, Labour Force Ageing and Skill Shortages in Canada and Ontario, Canadian Policy Research Networks, Ottawa, August 2004).
  • 84,000 new tourism job openings are projected in B.C. in the next decade. It's estimated that there will be 36 per cent more openings than skilled people to fill them. By 2015, B.C. will need 48,000 supervisory and management positions in the accommodation and food and beverage industry alone (Source: Brian Morton, "B.C. beckons for tourism workers," The Vancouver Sun, May 11, 2005).
  • Requirements for workers in western Canadian drilling, oil and gas field services, and allied contracting exceed 75,000 and possibly approach 90,000 (Petroleum Services Association of Canada).

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• Manufacturing Sector
  • Manufacturing is Canada's largest business sector, directly accounting for 18% of all economic activity in the country and providing jobs for 2.3 million Canadians (Ensuring the Future of Canadian Manufacturing, Canadian Manufacturers and Exporters [Hon. Perrin Betty], February 2005).
  • Not many Canadians realize that manufacturing is Canada's single largest business sector, nor are they aware that every dollar of manufacturing output generates $3.05 in total economic activity and that the sector accounts for two-thirds of private sector research and development (Will "Made in Canada" be a thing of the past? Manufacturers - change or perish! May 05, 2005. Available at: http://www.cme-mec.ca/bc/media.asp?id=32 - Canadian Manufacturers and Exporters).
  • The result of the manufacturing industy, as Jayson Myers, chief economist and senior vice- president of Canadian Manufacturers and Exporters, told the association's manufacturing summit this week, is 2.3 million jobs, 95 per cent of which are full-time, and which on average pay 22 per cent more than the national average for all jobs in Canada. And almost every community in Canada has some manufacturing activity (David Crane, Manufacturing must work for Canada's future, Toronto Star, February 11, 2005. Available at: http://www.cme-mec.ca/on/media.asp?id=372 - Canadian Manufacturers and Exporters).
  • A variety of skills shortages are reported, with companies finding it difficult to both attract and retain qualified personnel. Over 10% of manufacturers and exporters are experiencing difficulties in filling positions for entry-level employees, engineers, sales and marketing personnel, operators, designers, plant managers, electricians, welders and machinists (Conquering Challenges, Canadian Manufacturers and Exporters, Management Issues Survey, 2004-2005).
  • Thirty-six percent of this workforce is currently forty-five years or older, representing 823,000 workers. Within this group, 255,000 workers - eleven percent of the sector's workforce - are fifty-five or older. Given a median retirement age for the sector of sixty-one, the age distribution implies that a large contingent of these 255,000 workers will leave the labour force over the next five years (Ensuring the Future of Canadian Manufacturing, Canadian Manufacturers and Exporters [Hon. Perrin Betty], February 2005).
  • Seventy-three of the 76 major industry associations in Western Canada expect to encounter moderate to severe shortages of skilled workers within the next five years, according to a new report by the Canada West Foundation (Murray McNeill, Skilled Workers Wanted, January 14, 2005. Available at:
    http://www.cme-mec.ca/mb/media.asp?id=350 - Canadian Manufacturers and Exporters).
  • Over the next fifteen-year period, employers in the industry may be looking at replacing over 400,000 workers (Ensuring the Future of Canadian Manufacturing, Canadian Manufacturers and Exporters [Hon. Perrin Betty], February 2005).
  • The Canada West Foundation report said 41 of 76 associations believe the number of students currently graduating from post secondary institutions won't be enough to meet the labour demands of their industries (Murray McNeill, Skilled Workers Wanted, January 14, 2005. Available at: http://www.cme-mec.ca/mb/media.asp?id=350 - Canadian Manufacturers and Exporters).

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• Canadian Manufacturers and Exporters' Management Issues Survey
  • Of the 834 companies across the nation who responded to the Canadian Manufacturers and Exporters' Management Issues Survey for 2004 and 2005, companies marked the availability of skilled personnel as one of the areas with the greatest deterioration noted. 46% of them described the situation as being worse (then before) while only 5% said it was better (Conquering Challenges, Canadian Manufacturers and Exporters, Management Issues Survey, 2004-2005).
  • In the Canadian Manufacturers and Exporters' Management Issues Survey, 42% of the companies who responded said that the availability of skilled and experienced personnel was an important strategic challenge that they believe will reshape their business operations over the next three to five years (Conquering Challenges, Canadian Manufacturers and Exporters, Management Issues Survey, 2004-2005).
  • Of the top five constraints that companies experience in achieving measurable improvements in business performance was the lack or qualified personnel. To overcome the constraints they face in improving performance, 51% of companies are upgrading employee skill sets (Conquering Challenges, Canadian Manufacturers and Exporters, Management Issues Survey, 2004-2005).
  • There are many factors that affect innovation activity on the part of Canadian businesses. Availability of qualified personnel is one of the most important with 78% of companies describing it as a key factor affecting business innovation. (Conquering Challenges, Canadian Manufacturers and Exporters, Management Issues Survey, 2004-2005)
  • Manufacturers and exporters face a wave of retirements over the next five to ten years, making it even more challenging to attract and retain employees with required skills and experience. Companies report that they will take a number of actions to address their future labour needs. These include upgrading the skill sets of existing employees (85% of companies), placing greater emphasis on recruitment (71%) and hiring younger people (66%) (Conquering Challenges, Canadian Manufacturers and Exporters, Management Issues Survey, 2004-2005).

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• Education
  • Across Canada, the high school dropout rate stands at about 22 per cent (Louise Brown, "Province strives to keep teens in school," Toronto Star, May 18, 2005).
  • Nearly one in three grade 9 student in Ontario does not finish high school (Education Minister Gerard Kennedy - Ontario. Louise Brown, "Province strives to keep teens in school," Toronto Star, May 18, 2005).
  • Close to one-quarter of 17 year old high-school drop-outs reported at age 15 that a high school diploma or less was their highest educational aspirations (Source: Dropping out, Statistics Canada, Ottawa, February 23, 2005. Available at: www.statcan.ca/english/freepub/81-004-XIE/2004006/yits.htm ).
  • It is estimated that around 50% of secondary school students do not benefit from postsecondary education either because they go straight into the workforce after graduation or because they do not even graduate (Bob Rae, Ontario A Leader in Learning Report and Recommendations, February 2005).
  • Only about 80% of students graduate from secondary school in B.C. Also, only about 30% of the secondary school graduates attend colleges and universities and only about 19% of them obtain a degree. What is required are both increased technical and trades options of learners and more effective means to convince learners of the need for them to continue their education (Select Standing Committee on Education in BC, 2002)
  • Futurists have said that approximately 60-70 percent of jobs will require two years post-secondary education within the next few years (Association of Canadian Community Colleges [ACCC], Advocacy: A National Skills Agenda. Available at: www.accc.ca/english/advocacy/national_skills_agenda.cfm ).

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• The future supply of skilled tradespeople is at risk since university is the first-choice post-secondary education option among Canadian youth and their influencers.
  • University is a first choice post-secondary option for 67% of young people aged 13-24 and 55% of adults, ahead of college and apprenticeship or trades programs (CAF-FCA/SCC poll conducted by Ipsos-Reid, 2004).

• Forty-two percent of young people aged 13-24 said they would be unlikely to consider a career in the skilled trades, against 26% who said they would likely consider that option (CAF-FCA/SCC poll conducted by Ipsos-Reid, 2004).
• While 60% of parents said that they would be likely or very likely to recommend a career in the skilled trades to their children, 59% of young people say that their parents have not encouraged them to consider skilled trades as a career option(CAF-FCA/SCC poll conducted by Ipsos-Reid, 2004).
• Forty-seven percent of youth and 41% of parents hold the view that many skilled trades involve hard, physical labour (CAF-FCA/SCC poll conducted by Ipsos-Reid, 2004).
• A recent survey found that 37% of young people aged 13-24 said their schools did not have readily available information on skilled trades, compared to 35% who said their schools provided that information (CAF-FCA/SCC poll conducted by Ipsos-Reid, 2004).
• Furthermore, 72% of young people say their school guidance counselors have not encouraged skilled trades as a career option (CAF-FCA/SCC poll conducted by Ipsos-Reid, 2004).
• As identified by the Canadian Apprenticeship Forum's Consultation Report (Assessing and Completing Apprenticeship Training in Canada, 2004), [a participant] spoke of visiting a rural school where approximately 20 percent of students go to university: "Yet in the school entrance hall, there were three or four glossy career posters, which all focused on university careers. Here was nothing about the trades or work-related programs. This was not atypical but rather symbolic."

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