Global labour markets are undergoing a major change that will significantly affect the lives of working Canadians, unless the country’s skills strategy is overhauled in time, according to Ilse Treurnicht, a member of Canada’s Advisory Council on Economic Growth.
The rapidly shifting world economy will see many jobs disappear, while creating others, she said.
“This is a very complex problem; it can’t be fixed overnight,” said Treurnicht. “But if we don’t become proactive, of course, the fear is that we will only be dealing with the dislocation that comes from disruption and that we won’t necessarily be prepared to take advantage of the opportunities that will come from this turmoil.”
“The urgency cannot be underestimated,” she said. “In the short term, working adults will carry the brunt of the impact… The long-term consequences — not just on our economy, but on our quality of life — will be very significant.”
Speaking at a recent SCNetwork event in Toronto, Treurnicht discussed the advisory council’s final recommendations released in December 2017, focusing on the business investment and skills development needed to boost Canada’s growth agenda.
The country is facing the pressures of an aging demographic, technological disruption and a shift of trade towards Asia — all of which could contribute to a significant drop in growth domestic product (GDP) from three per cent annually to 1.5 per cent, she said.
“We’re not immune. These changes will come at us. If you just look at job losses as a result of technological change… there is a significant chance that 10 to 12 per cent of the population will face job losses or will really struggle to find alternative employment unless they are formally reskilled and acquire new qualifications.”
“There’s absolutely no question that there will be very significant turmoil and we need a new toolset to be prepared to deal with this.”
Finance Minister Bill Morneau established the independent advisory council in 2016 with a mandate to develop policy advice promoting long-term economic growth in Canada.
The 14-member council is made up of business and academics leaders, and has released three reports.
The first focused on the need to create a national infrastructure strategy and permanently increase immigration levels, while the second focused on the creation of a FutureSkills Lab and getting citizens in underrepresented sectors back to work, said Treurnicht.
“The topic of skills has penetrated pretty much all of our conversations and all of the recommendations that have come out so far.”
Across Canada, an underinvestment in machinery, equipment, software and people remains a “chronic challenge,” said Treurnicht, even as the country employs a high proportion of workers with post-secondary degrees.
Seventy per cent of private sector employers are small or medium in size, and often lack adequate training budgets, she said.
“For some time, Canadian employers have significantly underinvested in worker training. It’s really important to help people navigate this more effectively,” said Treurnicht. “Sophisticated employers will help their employees through this process, but there was a very strong feeling on the council that we need to seriously rethink the interface with Canadians and SMEs (small and medium-sized enterprises).”
“This is a massive transformation process.”
The partnership between Canadian business and post-secondary educational institutions has been identified as an area that could require transformation, such as a shift away from formal program degrees to more agile, part-time options, she said.
“It would be so much better if those programs can be developed in partnership with employers so that they are really relevant,” said Treurnicht, acknowledging that while much of the educational programming remains high quality, students may need to become life-long partners with educational institutions to “refuel and retool” as necessary.
An increase in online training programs could also prove favourable, especially in more remote areas, she said.
Change inevitably comes with an upside as well, said Treurnicht.
“New opportunities will also arise and many of those will require new skills. There is a huge upside if we are prepared and ready to take advantage of these opportunities.”
In terms of a national skills strategy, Canada will need to focus on employee dislocation, but also prepare workers to take advantage of new opportunities, she said.
A different pattern of work is emerging alongside the new-look economy. Today’s employees may spend time with more employers over shorter periods, or even work on a fluid basis within the gig economy, said Treurnicht.
The government needs to be active in this transformation, especially in terms of buffering the impact against society’s most vulnerable people, she said.
Quality of work and income security have a very profound impact on people’s sense of self, while inequality can also be a harbinger for loss of social trust, presenting a challenge to Canadians’ way of life, according to Treurnicht.
At present, Canada’s skills development system provides support in terms of education opportunities and retraining the unemployed, but another pillar is needed for working Canadians between the ages of 25 and 65, she said.
This reskilling pillar will require an additional $15 billion in funding per year by 2030, according to the council’s research.
“It will take a big collective effort of not just provincial and federal governments, but private sector employers, training and skilling organizations, the post-secondary system, and (Canadians themselves),” said Treurnicht.
“We will need to rethink all of our training programs to make them much more agile, much more current and relevant to the skills we need today, and streamline the access to those programs. We have to flip to a much more agile programming infrastructure that can stop stuff that’s no longer working.”
The strategy will require access to more up-to-date analytics of the labour market, as opposed to month-old information released by government agencies such as Statistics Canada, she said.
“Unfortunately, the data is usually quite old and, in fact, many of the job categories that we see today are not even represented in those tracking systems… We need to shift to a much better understanding of skills — emerging skills.”
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