Labour shortage costs billions, report warns

Province given several suggestions

EDMONTON — A new report says Alberta’s labour shortage will cost the provincial economy billions of dollars, but one of its recommendations to solve the problem — phasing out government-supported immigration of unskilled temporary workers — is sparking opposition from industry and government.

The recommendation is one of nearly two dozen contained in the report, titled An Examination of Alberta Labour Markets, that was commissioned and released Thursday by the University of Alberta’s Institute for Public Economics. The report was funded by the Government of Alberta and 12 industry associations and unions.

It puts a price tag on the province’s labour shortage of $33.5 billion in current dollars over four years in lost household income and corporate profits, and $6.8 billion in foregone taxes.

“There is clearly a demonstrable loss to the economy for not being able to fill positions that go wanting,” said institute director Bob Ascah.

The study says Edmonton and the Banff-Jasper region are two areas at greatest risk for labour shortages and the retail, hotel, food services and health-care industries are expected to be hit hardest.

Over four years, lost employment is estimated to total 267,000 person-years of employment.

It estimates the opportunity cost of labour shortages on the Alberta economy by using the provincial government’s 2013 budget forecasts.

The report provides recommendations to make greater use of under-tapped labour groups such as mature workers, people with disabilities and aboriginals.

The suggestions include making apprentices eligible for the student loan program; creating early learning centres in largely aboriginal neighbourhoods; and governments assuming the full cost of making workplaces suitable for disabled workers.

But the most controversial recommendation urges changes to immigration policy when it comes to lower-skilled workers.

The report says the Alberta government should phase out, over three to five years, the eligibility of lower-skilled workers in its provincial nominee program.

Under the Alberta Immigrant Nominee Program, individuals nominated by the province, and families, can apply for a permanent resi- dent visa through the federal government.

The federal temporary foreign worker program should be returned to its “original purpose of meeting temporary shortfalls for skilled workers,” the report also recommends.

Ascah acknowledged the suggestions are controversial, but said emphasizing skilled temporary foreign workers will be good for the labour market in the long run.

“Business lives in the short term and taking away over a period of time that plate from the table is going to be met with some resistance,” Ascah said.

“But we think it’s important to have a well-educated, adaptable workforce as technology changes so rapidly.

“The view of the authors is that you need to be getting people to fill the skilled positions and mature workers, disabled workers and aboriginal workers would be able to begin to fill in some of those occupations that are less skilled or semi-skilled.”

Dave Kaiser, president and CEO of the Alberta Hotel and Lodging Association, said removing unskilled temporary foreign labour would be “devastating” to the accommodation industry.

Based on a 2011 survey of members, 11 per cent of the industry’s jobs were filled by temporary foreign workers and at some hotels, they make up a third of the staff.

“That recommendation is really out of step with the reality in our industry,” Kaiser said.

Richard Truscott, Alberta director for the Canadian Federation of Independent Business, said the recommendation ignores the reality of the provincial labour market.

“Employers need workers at all skill levels and are desperate to find those individuals and the temporary foreign worker program has been one of the few ways they have been able to meet their needs,” Truscott said.

“For whatever reason, Canadians don’t seem to want certain jobs in the economy and employers who need low-skilled and semi-skilled workers are looking high and low and have not been able to find those people.”

Janice Schroeder, press secretary for Alberta deputy premier Thomas Lukaszuk, said the province will review the report, but expressed concern about the recommendation to phase out lower-skilled workers in its provincial nominee program.

“We think it’s a good thing to nominate people to fill jobs where there are shortages, and we can see from this report and everywhere else that shortages have a direct economic impact, so the recommendation does cause some concern for us,” Schroeder said.