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Jun 12, 2014

Canada must overcome sector-specific skills shortages: OECD

Calls for improved labour market info, stronger policy linkages with employers
    
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Canada has experienced solid economic growth since the global crisis, allowing it to reverse job losses and put federal public finances on a sound footing, according to the Organisation for Economic Co-operation and Development (OECD). Growth is expected to accelerate from 2.5 per cent this year to 2.7 per cent in 2015.

However, there are still important challenges to ensure strong, inclusive growth going forward and preserve Canada’s high levels of well-being, according to two new OECD reports. These include high housing prices and household debt, environmental concerns and localized and sector-specific skills shortages.

“Canada weathered the global crisis well and has out-performed most other advanced economies since the Great Recession. Economic growth will accelerate in the years to come, but skills shortages in some sectors and regions must be addressed to avoid constraining growth going forward,” said OECD secretary-general Angel Gurría speaking at the 20th International Economic Forum of the Americas/Conference of Montreal.

There is no generalized skills shortage in Canada but tensions are emerging in certain sectors and regions, he said. Earnings premiums have increased markedly in engineering, management and health care, pointing to skills shortages there. Job-vacancy rates in skilled trades have also increased sharply, especially in Alberta and Saskatchewan.

To reduce skills shortages, the Economic Survey of Canada calls for continued efforts to improve labour market information in order to bring students’ study choices more into line with labour market requirements. It also recommends harmonizing apprenticeship certifications across the country, to increase completion rates by boosting interprovincial mobility for apprentices.

Greater local-level involvement in the implementation of employment and skills policies is vital to align skills development efforts with employers’ needs, said the Employment and Skills Strategies in Canada – OECD Review on Local Job Creation. The report analyzes policies in Ontario and Quebec and makes recommendations on how to better connect employment, skills and economic development.

Stronger linkages with employers, as well as flexibility in the design and implementation of policies, are required to ensure communities can retain and attract highly skilled workers and jobs, said the organization.

Greater attention by the education, training and employment systems to how skills are used in the economy would stimulate productivity and innovation, long identified as among Canada’s greatest challenges, while addressing skills mismatches and helping create quality jobs, said the report. This would also mitigate the decline in labour supply likely to emerge as the workforce ages.

The federal government can promote a “place-sensitive” approach by considering how policies are implemented at the local level, and by encouraging provinces to take an integrated approach on the ground, said the OECD.

An overview of the Economic Survey of Canada is available at survey and the job creation report is found at Employment and Skills Strategies in Canada.

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