Federal budget to target mismatch between skilled workers and labour shortages

OTTAWA - Next week's federal budget will centre on fixing labour shortages and enhancing workforce skills, but don't expect new subsidies or training funds.

Rather, the government recognizes that progress on matching skills with job openings will require close co-operation with the provinces and private sector.

And if the recent report from the House of Commons human resources committee is a guide, Ottawa will focus on better dissemination of labour market information and encouraging co-operation among educators, employers, students and workers.

Ottawa is also re-examining its $2.5 billion in annual transfers to the provinces for labour-market initiatives to find ways to measure and improve the effectiveness of training and workplace programs.

And it's considering new ways to draw more skilled people with disabilities into the job market.

"We must think outside of the box because we need to get a better bang for our buck," Human Resources Minister Diane Finley said in a recent speech.

"We must do different things, different ways, with different partners — or a combination of all three."

Business has repeatedly complained about the lack of skilled workers to fill job vacancies, saying productivity is at risk because they can't find the right people — despite the large pool of unemployed workers in many communities.

"The single most pressing issue for members of the Canadian chamber and businesses across the country relates to the skills and labour shortages that are affecting Canada’s competitiveness," the Canadian Chamber of Commerce said in its pre-budget presentation to the House of Commons finance committee.

The quickest way to solve the skills gap is through more aggressive immigration and faster processing of temporary foreign workers, says the chamber.

But while immigration may be part of the budget package, the government is likely to have a more domestic focus that will encourage businesses to get more involved in training and skills development, said NDP human resources critic Chris Charlton.

She pointed to the recommendations of the Conservative-dominated human resource committee in its December report. The document urged the federal government to improve the quality and distribution of its labour market information; to fund apprenticeships and summer job programs; and to give businesses financial incentives to pay for on-the-job training.

The committee also called for more public-private partnerships, and a tax credit to workers who had to move temporarily for their jobs.

And it called on the government to find ways to encourage aboriginal and disabled workers to join the workforce — both of which the government has said it wants to do.

Indeed, Finley has signalled that people with disabilities will figure prominently in her plans.

"We have so much potential in Canada — both from our resources and from our people. But the key is unleashing that potential," Finley said in her recent speech.

"This makes me think of people with disabilities as an example of a gold mine for tapping talent — and where we can do much, much more."

A federal task force has already established the business case for hiring more people with disabilities, says Laurie Beachall, national co-ordinator of the Council of Canadians with Disabilities. Ottawa could push that case by requiring provinces to spend part of their employment insurance transfer payments on workers with disabilities, or by offering incentives directly to employers, he said.

Poverty among people with disabilities is double the average poverty rate, but the potential for skilled workers is large. Federal data suggests there is a pool of almost 800,000 people with disabilities who are willing and able to work, but are not. Almost half of those have some kind of post-secondary education.

One area where the budget is unlikely go, however, is into the area of employment insurance payments to individuals. Finley has been under fire for months for her overhaul of the EI system, especially east of Ontario where provincial governments and critics say she is undermining seasonal workers.

The NDP has urged the government to reinstate the extra five-weeks of EI it extended for seasonal workers during the last recession, but Finley has given no indication of budging.