Skills and Skills Shortages
Reports about shortages of physicians, nurses, skilled tradespeople, truck drivers, and many other occupations and professions have become commonplace in the pages of our daily newspapers across the country. It is becoming increasingly apparent that these shortages are not isolated, short-term anomalies, with easy "quick-fix" solutions. Instead, they are the outcome of structural trends that are fundamentally affecting the supply and demand for skilled labour. They are rooted in the demographic trend of an aging population and the requirements of an advanced economy in which knowledge, skills and innovation are nothing less than prerequisites for continued prosperity. In this sense, current examples of specific occupational shortages are indicative of a more significant, longer and widespread human resource challenge that will directly or indirectly affect all sectors of the Canadian economy.
Consider the following:
Unemployment levels in Canada are currently at their lowest level in three decades, and labour force supply is likely to remain tight for many years. The Organisation for Economic Cooperation and Development (OECD) projects that Canada’s annual labour force growth will fall to less than 0.5% between 2000 and 2020. Over the period 2020 to 2050, labour force growth is expected to be negative2.
According to Statistics Canada, there are 2.9 million workers within 10 years of the median retirement age3.
The expected tightening of labour supply is occurring at a time when the demand for skills is apparently increasing. Already, a large majority of net labour force growth occurs in jobs that the National Occupational Classification system identifies as typically requiring post-secondary education and training. For instance, Statistics Canada reports that from 1991 to 2001, the number of people in the labour force increased by 1.3 million to 15.6 million (a 9.5% increase). However, the number of people in highly skilled occupations - those that usually require a university education increased by 33% - more than three times the rate of the overall labour force4.
In all provinces and territories, the rate of growth in highly skilled occupations is far outpacing that of occupations requiring only secondary education or less5.
The challenge of meeting human resource requirements in the wake of the baby boom retirement wave will depend on our ability to make optimal use of available human resources, to enhance the quantity and quality of workplace training and lifelong learning, to enhance the schoolwork-school transitions, and to ensure that barriers to full participation are minimized, if not eliminated. To be sure, skills shortages are not evenly spread throughout the country, nor do they affect all occupations to the same extent. Businesses continue to restructure or close, and workers do lose their jobs. But there is no reason to expect that in a time of skills shortage, such adjustments would not continue to take place. The real challenge is to develop effective ways of minimizing the impact of such events and to ensure that learning and employment opportunities are available to all who need them.
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2 OECD (2005). Ageing Populations: High Time for Action. Background paper prepared by the OECD Secretariat for the meeting of G8 Employment Ministers, London, 10-11 March, 2005
3 Statistics Canada (2005). The Canadian Labour Market at a Glance. Catalogue 71-222-XWE.
4 Statistics Canada (2003). The Changing Profile of Canada’s Labour Force. Ottawa: Minister of Industry. Catalogue no. 96F0030XIE2001009.
5 Calculations by the Canadian Labour and Business Centre using Statistics Canada Census data, Catalogue no. 96F0030XIE2001009.