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the skills gap

A man walks back to work at an oil rig drill.iznashih/Getty Images/iStockphoto

Dressing for success in today's job market is as much about steel-toed boots and hard hats as it is about tailored suits.

"Not all skill labels [in demand by employers] are PhDs. We are talking about crane operators, heavy machinery operators, truck drivers. In Alberta, people in the oil sands," said Benjamin Tal, deputy chief economist at CIBC World Markets and author of a recent report on the haves and have-nots of the Canadian labour market.

In response to shortages deemed so severe that Canada's economic growth is being hampered, the federal government recently announced the creation of a new immigration program to fast-track the entry of foreign skilled tradespeople whose talents are in demand, including electricians, welders, heavy duty equipment mechanics, and pipefitters. On Wednesday, Ottawa said that starting in May, it will use new judging criteria to award more points to younger immigrants and change how work experience and education is assessed.

The moves reflect the fact that skilled trades have been on the top five list of specializations in demand for the past decade – along with engineering, specialized information technology, management, accounting and finance, the Conference Board of Canada reported in a report on the human resources outlook for 2013.

Yet the trades are an often-overlooked occupational choice for Canadians planning for the future, in part because there are not enough apprenticeship opportunities.

In the health-care sector, everyone knows about the ongoing need for more doctors and dentists, Mr. Tal said in an interview. But it is important to note, as well, that the average age of nurses is about 43. "We are going to have a crisis when they retire, at a time when we need them more and more …"

Canada needs to identify these needs, he said, especially when so many people are without jobs, or studying in disciplines where there is an oversupply of talent – fields such as teaching, for example. (Traditional occupations such as butchers, bakers, tailors, labourers in manufacturing, office managers and clerks are also showing signs of labour surplus, he said.)

"An analysis of Canada's job market shows there is a growing divide between the have and the have-not occupations," Mr. Tal wrote in his recent report.

"By far, the largest skill shortage was found in health-related occupations, the mining industry, advanced manufacturing and business services … and the average unemployment rate of this pool of occupations is just over 1 per cent [compared with the national unemployment rate of 7.2 per cent in November]."

Immigration is part of the solution – "but I find it difficult to say the solution is immigration, when you have an army of people who are sitting in the unemployment line or waiting for a job to open," Mr. Tal said. "They have all sorts of skills, they simply happen to be in the wrong field … and that is not a very effective way of using human capital …

"The other solution is on-the-job training, and this is really the responsibility of corporate Canada. That's where I see corporate Canada looking at their people, looking for potential and seeing whether or not they can advance somebody through on-the-job training, as opposed to hiring somebody with exactly the qualifications that they need and probably very difficult to find."

Labour market shortages could also be eased by adapting the skills of workers in declining industries to meet the needs in growing sectors, he said.

Workopolis found in a recent survey of 100 senior executives that 30 per cent of Canadian businesses plan to increase their staff size in 2013. "While one might expect that the significant number of jobless Canadians combined with the proliferation of job openings would be good news for Canada's employment situation, employers report increasing – not decreasing – difficulty locating the talent they need," Workopolis said in its report, titled "Mind the Gap."

"In addition to job-specific skills, recruiters are also placing a high premium on softer skills like communication and work ethic," Workopolis found.

However, the survey also uncovered a troubling tendency by employers to overlook the talent pool of recent graduates, either because they lack experience or because of a perception that this is an "entitled generation" with unrealistic expectations, Tara Talbot, vice-president of human resources at Workopolis, said in an interview.

"This is a huge talent pool that we need to tap into. They are well-educated, they are tech-savvy, they are going to bring new perspectives, they have energy and enthusiasm. I think employers have to get over their perceptions that the young may have entitlement issues and … bridge that gap," Ms. Talbot said.

Location is another big factor in labour market imbalances. "By region, labour market pressure in Saskatchewan and Alberta is high, where 83 per cent and 82 per cent of employers face challenges recruiting and retaining employees."

"By comparison, 59 per cent of organizations in Ontario face this pressure," the Conference Board reports. "Recruiting and retention continues to be a challenge in the professional, scientific, and technical services and the oil and gas industries."

In a recent scan of recruitment and job search activity on its website, Workopolis found that Edmonton and Calgary are hot job markets for engineers and accountants. But there appears to be a surplus of people looking for sales and manufacturing jobs in the West.

In Montreal, there is a shortage of software developers, office staff and sales people, while there is a surplus of engineers and finance professionals.

"In Toronto, bankers and finance professionals appear to be in short supply, as well as software developers and skilled tradespeople," said Peter Harris, editor-in-chief of the online news hub at Workopolis. But Toronto has a surplus of IT, insurance and digital media professionals.

"It is important to understand that [the skills gap] problem is becoming big enough to really impact not only on the specific individuals who cannot find a job, or the company that cannot find people – it has become big enough to impact the economy as well," Mr. Tal said.

"To the extent that we cannot find people, to the extent that there is this mismatch between what we can offer and what is available, it means that the economy is not operating in an optimal way. We are not growing as rapidly as we can, our productivity it not rising as quickly as it can."

By the numbers


Number of Canadian businesses that say they face a shortage of skilled labour, nearly double the rate seen in early 2010.


Number of Canadian executives surveyed by Workopolis who say they plan to expand their employment rolls this year.


Portion of senior executives who cite a lack of soft skills – positive attitude, communications skills, a strong work ethic, teamwork – among job applicants candidates.


Portion of organizations that say they have adopted specific strategies to retain or attract essential talent, the most common strategies being raises and signing bonuses.

Sources: CIBC World Markets; Workopolis; Conference Board of Canada.

Hot Jobs

Professional engineers (civil, mechanical, electrical, chemical)

Information technology specialists

Skilled trades (including electricians, welders, heavy-duty equipment mechanics, pipefitters)

Auditors, accountants and investment professionals

Human resources and business services

Physicians, dentists, pharmacists

Registered nurses, dieticians, therapists

Medical technologists and technicians

Marketing specialists

Psychologists, social workers, counselors, clergy

Physical sciences

Managers in health, education, social and community services

Managers in engineering, architecture, science and information systems

Sources: CIBC World Markets, Conference Board of Canada, Government of Canada

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