Where Did All The People Go? 0

Posted On March 22, 2022, by Admin

According to a BDC study (the Canadian bank for entrepreneurs), 55% of small and medium-sized Canadian businesses are struggling to find new employees, and 26% have difficulties retaining their staff. The study, which surveyed 1,251 entrepreneurs and 3,000 employees, has revealed that two-thirds of SMEs have lost business opportunities due to an insufficient number of workers. As a result, their business growth and order delivery have suffered.

The report has revealed that 63% of businesses are unable to find candidates who possess the right skills and experiences. Meanwhile, 52% of the companies complained that there aren’t enough candidates available.

According to Ontario employment statistics, Canada is experiencing a labour shortage in several sectors of the economy, despite a national unemployment rate of 5.9%. It seems that an insufficient number of workers is preventing a full recovery of the economy after the pandemic.


What Might Be the Causes of Labour Shortage?

Many companies had difficulty finding workers even before the pandemic struck in March 2020. Still, due to the aging population and limited immigration during COVID-19, Canada’s labour shortage has become even more complex. Because of the constant lockdowns in 2020, some workers in the worst-affected sectors, such as food service and personal care, have either upgraded their skills or looked for other jobs in different sectors.

During the pandemic, federal income assistance programs enabled many workers to stay at home and avoid public-facing jobs. This situation has also revealed another significant impact of shortage of staff — the number of temporary foreign workers, students, and immigrants entering Canada plummeted, thus affecting the labour market.

Still, some employers believe that difficulties assessing potential employees’ skills and intense job competition are the main reasons for the hiring drought. Furthermore, some companies claim they are facing a skills gap because people lack both hard and soft skills, whereas others report a lack of applicants.

That is why, in order to attract candidates, some employers have started offering higher salaries. However, the turnover continues to be high despite their best efforts.

The technological advancements in traditional industries are also leading reasons for the skilled labour shortage. Machinery and equipment are far more technologically advanced today; however, there has not been any retraining or upgrading of an aging workforce of skilled trades. Furthermore, attracting younger demographics to the trades represents a challenge since those careers aren’t typically considered desirable.

According to labour shortage statistics Canada, approximately 23% of the working-age population will be 65 or older by 2024. This means that the post-pandemic labour market in Canada will continue to face a shortage of workers as the baby-boom generation approaches retirement.

On the other hand, some argue that there is no labour shortage but a shortage of employers willing to offer competitive wages and good working conditions. There is a growing understanding among employees that they do not have to accept precarious work from exploitative employers — in fact, they’ve been utilizing their collective union power to demand higher salaries and better work opportunities.

The Ways of Staying Competitive During a Labour Shortage

Canada has been facing a staff shortage due to an aging population for a decade, but the COVID-19 pandemic has exacerbated the problem.

In a market transformed by the recent outbreak, what may have worked in the past to attract qualified candidates might not work today. Employers need to adapt their recruitment strategies by offering workers exactly what they are after.

Ensure Clarity and Transparency in Hiring

Spend time and resources finding the candidates with the appropriate skills and personality traits for the job, as they are more likely to stay longer. When conducting interviews, clarify what the job duties and expectations are. If you make a poor hiring decision, it can backfire, as the employee may decide to quit soon, or you might even have to let them go.

Provide Competitive Pay and Benefits

Whether you’re hiring new employees or retaining existing ones, you should offer competitive salaries and benefits, such as paid vacation, sick leave, healthcare benefits, and other perks. The BDC study found that employees are looking to change jobs for two main reasons: higher wages and more benefits. Providing employees with a good compensation package motivates them to do their best.

Offer Flexible, Hybrid, or Remote Work Options

The past two years have shown that remote workers can be just as productive as their office-based colleagues. People have also become less tolerant of long and crowded commutes. Employees with childcare or caregiving responsibilities have found remote work especially beneficial.

Most job seekers now want (and expect) flexible working hours or the chance to work remotely. According to the Hays Salary Guide for 2021, one of the most wanted benefits among employees is the ability to work from home.

Employers would also profit from a hybrid or remote workplace. They would be able to hire talented employees from across the country. Additionally, it would reduce the costs of maintaining a full-time working environment (rent, overhead expenses).

Reward Good Work

Show your employees how much you appreciate their efforts. Give them constructive feedback and encourage them to take ownership of their work. Provide performance-based incentive programs including bonuses, flexible work schedules, and — for those who need it — the opportunity to work from home.

Create Opportunities for Growth

The lack of advancement opportunities is also one of the reasons why employees may feel demotivated or seek a new job. You should invest in workshops, training, and flextime to help your team upgrade their skills. Once they acquire new skill sets, your employees can also be mentored and promoted within the company when there are vacancies.

Automate Certain Processes

The study says companies who automate certain processes are twice as likely to find recruiting easy and 1.9 times more likely to grow revenue above the industry average than those that haven’t gone down this path. The fact is, only one in four Canadian SMEs is entirely automated in at least one aspect of its businesses. When routine administrative tasks are performed automatically, your staff will have more time to invest in upskilling.

Provide Health Insurance

Employees consistently rank health insurance as one of the most desired benefits across all industries. As a result of the COVID-19 pandemic, everyone is more aware of the importance of good health coverage. Most small businesses could retain and attract top candidates by increasing the health insurance and cost-sharing options rather than by adding benefits that employees may not need or do not consider significant.

Offer a Retirement Plan

Making contributions to the retirement plans of your employees is a popular way to invest in their retirement. The employer contribution is seen as a reward for the employee’s hard work in return for future investment. Additionally, contributing to or matching a retirement plan demonstrates an employer’s commitment to employees’ long-term success, which can be an attractive and motivating employment benefit.

What has been your experience?  Have you changed how you are trying to fill open positions?  What changes to your process have you been successful with?


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This blog is not meant to provide specific advice or opinions regarding the topic(s) discussed above. Should you have a question about your specific situation, please discuss it with your GBA advisor.

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