Labour shortages costing Canadian small businesses $38B
November 29, 2023 | By HPAC Magazine
Labour reports by the Canadian Federation of Independent Business identify problems and propose solutions.
A new report by the Canadian Federation of Independent Business (CFIB) finds that small businesses in Canada missed over $38 billion in revenue opportunities last year because they had to turn down or postpone contracts or sales due to labour shortages, with the construction sector taking the largest hit.
“Staffing challenges cause employers to work more hours, reduce their hours of operation and decline services and contracts, simply because they can’t find enough staff to fully operate their business,” said Laure-Anna Bomal, CFIB’s economist and the report’s author.
Small businesses in the construction sector faced the most significant loss of business opportunities, over $9.6 billion in the last year, according to the report.
Following a review how other jurisdictions address labour shortages, CFIB completed a whitepaper “on how to approach various barriers. The policy proposals cover three age groups—youth (15-24), core age (24-64), and older workers (65+).
Proposals include:
- increase workforce participation among youth with increased work-integrated learning in high schools.
- employment insurance program design shouldn’t create disincentives to work
- governments need to facilitate labour mobility across provinces
- for experienced workers, governments should revisit existing tax policy and/or create a tax credit for career extension.
“As Canada’s population is aging, we need to ensure that those who are willing to work can do so without significant challenges. In the long run, the shortages will get worse, as will their costs, unless we change our labour market approach,” said Christina Santini, Director of National Affairs at CFIB. “We urge governments to find innovative ways to increase participation in the labour market among all age groups.”
