Canada’s skills gap continues to widen, according to study

According to a new study from global recruiting firm Hays PLC, which surveyed the skills gap in 30 developed countries around the world, Canada ranks ninth for the severity of its skills shortage, and its score deteriorated in the past year.

Countries such as Japan, the United States, Germany and Sweden top the list in skilled worker shortage.

Study shows that Canada ranks 9th in the developed world in shortage of skilled workers

The report highlights two key findings

First, the state and the efficiency of a labour market in any particular country is not necessarily driven by the state of the economy in that point in time. Rather, the data suggests through the index that the efficiency of the labour market is driven by more structural factors. That said, the governments can introduce reforms to improve those structural factors, regardless of where they are in the economic cycle.

The second key finding that the index illustrates is that there is a very strong link between the efficiency of an educational system and the ability of that economy to produce the talent that the nation’s industries require both today and in the future. Making sure that business and the educational systems are in sync to produce sufficient numbers of the right quality graduates in the right areas for future talent. That’s the fundamental part of what drives the efficiency in any particular market.

As the global economy recovers and as the Canadian work force continues to age, without a change in policy, the situation in Canada and other developed countries will likely get worse. Canada is falling behind in implementing enough changes to meet the demand for highly skilled migration.

How to improve the skilled worker shortage and avoid disaster in the future

As according to Alistair Cox, the chief executive of Hays PLC, there are three areas where business and the governments can work together to strengthen these labour markets and reduce these inefficiencies that we see in some of these economies:

The first is for the government to foster a business environment of flexibilities, where businesses can build the work force they need for the future. This can be achieved through flexible working arrangements and skilled immigration.

The second method is to make sure that the educational system in an economy are really tuned into what businesses are going to need in the future in terms of the number of right skills.

The third is for businesses to look at their own policy in terms of attracting and retaining staff. Not just younger staff but also retaining and retraining older staff within their own work force.

Immigration Canada making changes

It’s not yet known how effective it will be, however, Canada is working on some changes in the system that are expected to be implemented in late 2014. Last year, Immigration Canada and the provinces, reached an agreement on the future of Canadian immigration system. The system will give the provinces a central role in immigrant selection. This new system will be based on a model called Expression of Interest (EOI).

The EOI model is an immigrant selection process which requires those seeking to immigrate to first file a simplified application, with immigration authorities. From that pool of applicants, the most promising candidates, based on the immigration department’s selection criteria, are then selected, and invited to submit a full application which includes documentation to prove their claimed qualifications.

Canadian Immigration Strike is Over

The foreign service officers have ended their strike after reaching a tentative agreement with the Canadian government.

This is good news for many international students, workers and others who have been in limbo, waiting for their visas to be processed.

Treasury Board President Tony Clement, right, posted this “selfie” photo on Instagram after he and PAFSO president Tim Edwards, left, “signed a deal that is good for taxpayers & FSOs.”

The agreement between the union representing foreign service officers and the Canadian government effectively ends one of the longest strikes in the federal public service.

The new agreement moves the foreign service officers’ salaries closer to other civil servants who do similar work and who sometimes take the place of foreign service officers on postings abroad. It is expected to cost about 60% of the $4.2 million sought by the union.

As according to the CBC:

New pay steps have been added to two of the salary bands, or ranges, with another band having the lowest two steps deleted, so employees in that band start at a higher wage.

Pay steps are gradually increasing pay rates within a salary range.

The wage gap between the more junior FS-02 level of foreign service officers and the same level of commercial officers, who had been earning more, is eliminated, with two new pay steps added. Those workers will get 4.5 per cent increases per step up through the pay scales, rather than four per cent.

The gap between the FS-02s and two competing groups, the commercial officers and economic officers, is small enough “to be considered ‘at equivalent level,’” the union said to its members.

The wage gap between the more senior FS-04 level and the most junior level of public service executives is eliminated with the addition of one new pay step, the union told its members, putting the foreign service officers $875 higher at their maximum level.

The mid-range FS-03 level of foreign service officers are losing their two lowest pay steps in the range, bringing the new starting rate for the salary band to $86,604.

The high end of the FS-03 salary range will be almost $110,000 under the new agreement.

On September 13th, the Public Service Labour Relations Board ruled that the federal government had been bargaining in bad faith in its negotiation with striking diplomats:

Once the respondent entered into a negotiation of the conditions under which the determination would occur, it was under the obligation to bargain those conditions in good faith and to make every reasonable effort to conclude a collective agreement – the respondent’s actions had breached that duty – it knew or should have known that the conditions could not have been accepted by the complainant as they would have precluded the complainant from putting forward its argument to the decision maker and would have predetermined the outcome – that was unreasonable and contrary to section 106 of the Act – the respondent had crossed over from hard bargaining to surface bargaining – the respondent had engaged in bad faith bargaining

As expected, critics of the government were ready to weigh in with their thoughts. NDP Foreign Affairs critic Paul Dewar:

“Canada’s international presence depends on the patriotic dedication of our talented foreign service officers. Our diplomats take on personal risk and hardship in being posted abroad — they deserve our respect and gratitude for their service to our country”

Now that that the strike is over. the foreign service officers will be working hard in order to speed up processing of the applications that have been increasing in the backlog.

Canadian Economist Calls for Employment-Based Immigration Selection Process

A new report by SFU Professor of Economics (Emeritus) and Fraser Institute senior fellow Herbert Grubel calls for a total overhaul of Canada’s immigration selection process (Simon Fraser University)

A new report by Canadian economist and former Member of Parliament Herbert Grubel calls for Canada’s point-based immigration selection process to be completely replaced with one based on employment.

Grubel, who is a Fraser Institute senior fellow and a professor emeritus of economics with Simon Fraser University has been a longtime proponent of placing more limits on immigration, a position which he views as an extension of his fiscal conservatism.

The report contends that immigration costs Canadians $20 billion annually, as a result of immigrants paying less in taxes while using up just as much in government services as the native-born population.

While welcoming some of the recent changes made to the immigration selection process by former Immigration Minister Jason Kenney, Grubel argues that they do not go far enough, and proposes two major changes to Canadian immigration to make it more economically beneficial to native-born Canadians:

  • Elimination of parent and grandparent (PGP) sponsorship for new immigrants. The report notes that following the initial 10-year period when sponsors are financially responsibility for the costs of the social benefits received by their sponsored PGP, the percentage within this cohort that receives social assistance immediately increased from 3 percent to 20 percent.

    While welcoming the new 20-year sponsorship period that is to come into effect for the PGP sponsorship program, Grubel says that the enforcement of the sponsor’s responsibilities will be difficult, and it would be simpler to simply eliminate PGP sponsorship as a permanent residency program.

    Grubel proposes a transition period whereby all immigrants who became permanent residents before his proposed rule change maintain their right to sponsor their PGPs for permanent residency, while immigrants who arrive after lose this privilege. In this way, Grubel argues the elimination of the program can be done fairly, by allowing those who immigrated to Canada under the assumption that they would be able to sponsor their PGPs to retain this ability.

  • Replace point-based assessment method of selection with employment-based selection. Grubel suggests only skilled workers with pre-arranged employment should be admitted under the skilled worker program. He argues that employer decisions on who to hire provide better information on who has the skills to succeed in Canada than a bureaucratic process created by civil servants.

    He proposes however to keep the federal government involved in setting minimum standards and wages, to prevent employers from using immigration to secure low wage labourers that cost taxpayers more in the provision of social services than they pay in taxes.

    An employment-driven skilled worker program, the report suggests, would adjust the number of immigrants admitted according to economic conditions, where immigration would decline when jobs are scarce, and increase when jobs are plentiful. The number admitted per year would therefore match the needs of the Canadian economy better than a number selected through the political process.

Critique of report by the Broadbent Institute

The report’s proposal to dramatically overhaul the Canadian immigration selection process has, predictably, found critics. A recent article from Broadbent Institute fellow Patti Tamara Lenard challenges several of its claims.

Lenard argues that the report’s conclusion that immigrants impose a fiscal burden on other Canadians, which it draws from statistics showing recent immigrants have a lower average income and pay less in taxes than the average native-born Canadian, neglects the fact that immigrants are younger than the average Canadian when they arrive in Canada, and therefore is faulty.

The report’s analysis of immigrant income does not include only immigrants who just arrived in Canada however. The immigrant cohort used by Grubel’s comparison is individuals who arrived in Canada between 1986 and 2004, and the length of time they were in Canada ranged from 1 to 18 years.

While Lenard’s suggestion that the analysis compares younger immigrants to older native-born Canadians is not supported by the composition of the dataset used by the report, it is true that Grubel does not make an effort to control for age in his analysis, and therefore it could be an unaccounted factor in the income gap.

Lenard also disputes the report’s assumption that immigrants are as likely to use social programs as the rest of the Canadian population, citing a Swedish study that finds that Canadian immigrants use fewer social services than the general population. The report’s estimation on the cost of the social services used by Canadian immigrants is therefore too high she argues.

Lenard’s article in places makes some hasty and inaccurate criticisms of Grubel’s report. She claims for instance that the report states that “in 2011 over 50,000 [Parent and Grandparent] immigrants entered Canada”, but that the actual number was 14,000.

In actuality, the report cites Citizenship and Immigration Canada’s (CIC) own data projecting that over 50,000 PGPs will become permanent residents over 2012 AND 2013, a two year period, not in a single year, 2011.

Lenard also claims that the report “implies .. we should expect [PGP's] health care costs to mimic those of Canadians aged over 65″, and that this is misleading, due to the fact that PGPs’ health care costs are covered by their sponsors for the first 10 years after their arrival. The content of the report does not support Lenard’s claim, as it clearly conveys the same point Lenard claims it neglected, and instead focuses on indications of high social assistance costs for PGPs once they turn 75 and are no longer the financial responsibility of their sponsors.

Gaps in data

While the Broadbent Institute’s review of Grubel’s report falls short in providing an informed critique of the report’s proposals and arguments, it does touch on the gaps in the data on the economic impact of Canadian immigration, and the heavy reliance on conjecture – which is more subject to the influence of ideology – in discussions on the optimal immigration selection process for Canada.

As a result of the many unknowns surrounding immigration and its impact, it will likely remain a contentious issue in Canada for years to come, until more data on the economic outcomes of Canadian immigrants is generated, and Canadians have a clearer picture of what programs work and which ones don’t.

Lax Deportation Enforcement Blamed for Death of Young Woman

The family of Jenna Cartwright says they feel “betrayed” by the federal government’s failure to detain Gaashaan after he was ordered deported

The family of a young Albertan woman who police believe was murdered by a convicted drug dealer from Somalia calls the federal government’s failure to deport the suspected perpetrator, “sickening”.

Arriving in Canada in 1993 as a refugee, and acquiring permanent residency in 1997, suspected murderer Bashir Gaashaan soon fell into a life of crime, and in 2009, due to two convictions that constituted “serious criminality”, faced a hearing at the Immigration and Refugee Board (IRB), where the Canada Border Services Agency (CBSA) asked that he be deported, and detained until his day of deportation, due to being a flight risk and a danger to the public.

The board ordered the deportation but, according to documents gathered by the Calgary Sun, argued that it would unfair to hold Gaashaan until he was deported, as the deportation process could be lengthy:

Because Gaashaan arrived from Somalia as a refugee in 1993, the CBSA couldn’t deport him without a “danger opinion”.

That’s an order issued by the Minister of Immigration, stating the danger to Canada outweighs the risk to an individual being sent back to a potentially unsafe country.

Being federal paperwork with legal status, danger opinions are very slow in being completed — and time waiting in jail would have been unfair to poor Gaashaan.

“So if he’s detained, detention is likely to be lengthy. I know that it’s difficult to remove to Somalia at the best of times. Taking all of that into account, I think that the appropriate thing is to release him on terms and conditions,” states the ruling.

Less than two years later, on June 16, 2011, police charged Gaashaan with first-degree murder, unlawful confinement, offering an indignity to human remains, and sexual assault, in the death of Jenna Cartwright, 21, of Red Deer, Alberta, as well trafficking in cocaine.

Jenna Cartwright’s twin sister, Marissa Cartwright, said she is furious about the handling of Gaashaan’s deportation. “I’m so angry, even more angry than before — the whole thing is sickening,” she told the media.

She added that she felt “betrayed” by the government:

“I cannot believe this has happened, I honestly feel betrayed by our government — we should be able to rely on our government and know they are keeping us safe.”

The failure of the refugee board to place Gaashaan in detention after he was ordered deported is being seen by many as an example of the immigration and refugee system being more concerned with political correctness than national interests.

The public response could lead to pressure on the federal government to speed up the deportation process, which has already been reformed in the past year to address a wave of bogus asylum claims from Hungary.

It could also lead to individuals who have been ordered deported more often being held in detention until their deportation, and new monitoring technologies like electronic bracelets being deployed on a large scale in asylum and deportation cases.

Immigration Boosting Canadian Housing Sector -Analysis

A house in Greater Vancouver, Canada. A report by the National Bank of Canada says the effects of immigration on demographics will keep housing prices in Canada from falling (Tony Fox, GFLD)

A new economic analysis credits immigration for keeping Canada’s housing sector growing amid a slowdown in the developed economies.

As reported by the Globe and Mail, a National Bank of Canada (NBC) report on the Canadian housing market finds that the so-called ‘household forming cohort’, which is the segment of the population aged 20-44, is growing much faster in Canada than in most developed countries.

Without the influx of 147,000 new Canadians aged 20-44 through immigration, the demographic would have seen a decline in 2012, according to NBC senior economist and report author, Matthieu Arseneau. The average growth rate of the 20-44 demographic was negative 0.3 percent last year among the rest of the developed economies, compared to the positive 1.1 percent growth rate seen in Canada.

Arseneau cites a high rate of employment among foreign born Canadian citizens, which is lower than only New Zealand and Norway’s, as a pull attracting foreigners to immigrate to Canada.

The report projects the growth in Canada’s 20-44 cohort will decrease after 2013, but will remain positive, and will exceed that of other developed countries. This demographic trend, Arseneau argues, will provide the country’s housing market with a comparative advantage over those in other developed countries, and reduce the likelihood of a crash in Canadian housing prices as predicted by some market watchers.

Immigration Department Closing Citizenship Applications to Reduce Backlog

New Canadians taking the Oath of Citizenship. Citizenship application processing times have increased from 12 – 15 months in 2008 to 23 months today

Citizenship and Immigration Canada (CIC) is closing citizenship applications of unresponsive applicants in an effort to reduce its backlog and speed up application processing.

A new article by Postmedia News lists some factors that could be used to determine which applications are dormant:

Citizenship and Immigration will shut the files of those who fail to attend multiple scheduled citizenship tests or interviews. Applications submitted on or after April 17, 2009 will also be considered dormant and closed if applicants fail to provide proof of residency after receiving two notices to do so from the government.

CIC spokeswoman Andrea Khanjin told Postmedia News that 54,000 citizenship applicants did not show up for their citizenship test in just the last three years and that CIC estimates about 12,000 files will be closed soon under the new procedures.

Khanjin said that citizenship application processing will favour those who make an effort to comply with the process requirements over those who do not:

“Those who take their citizenship seriously will not have to wait in line behind those that don’t bother showing up to their citizenship test, interview, or who don’t respond to a residence questionnaire. The citizenship application process has been bogged down for too long by those that do not take Canadian citizenship seriously.”

Citizenship application processing times have increased in recent years, from 12 to 15 months in 2008 to 23 months in April of this year, leading to more funding being allotted by the federal government for citizenship application processing and, now, an effort to cut down the backlog of 350,000 applications by closing dormant files.

Canada comes in top 5 among G20 in Entrepreneurship Ranking

Lack of regulatory barriers, availability of venture capital funding and a culture that embraces entrepreneurship placed Canada in the top quartile in the EY G20 Entrepreneurship Barometer 2013 (U.S. Department of State)

A new report by Ernst & Young places Canada’s entrepreneurial ecosystem in the top five among the G20 countries.

The G20 Entrepreneurship Barometer 2013 ranks a country’s entrepreneurial environment according to its score in five sub-categories: access to funding, entrepreneurship culture, tax and regulation, education and training, and coordinated support between government, academic institutions and the private sector.

The formulation of the ratings relies on business environment indicators, like number of new businesses started per year, data collected in a survey of more than 1,500 entrepreneurs across the G20 countries, the insights gained in interviews with entrepreneurs, academics and experts, and a qualitative analysis of government initiatives to encourage and assist entrepreneurship.

Canada came fourth in the access to funding category, thanks largely to per capita venture capital funding that is second only to the U.S. It ranked third in entrepreneurship culture, behind the U.S. and South Korea, as interviewees had a generally positive opinion of the country’s attitude toward entrepreneurship and its acceptance of failure (more accepting than other countries).

In the tax and regulation category, which scores countries by the ease of complying with regulations when starting and running a business, and the number of special tax incentives for entrepreneurs, the country came second, after Saudi Arabia, for its simple business registration process, lack of labour laws allowing for a flexible labour market, and an abundance of tax subsidies for small and medium sized enterprises.

While the G20 Entrepreneurship Barometer is one of many possible ways of determining the quality of an entrepreneurial ecosystem, and has not been shown to predict for entrepreneurial success, Canada’s strong showing will at the very least help boost its image globally as a centre of innovation and a country that’s open for business.

Canadian Government Celebrates First Skilled Trades Immigrant

Citizenship and Immigration Minister Chris Alexander welcoming one of the first successful Federal Skilled Trades Program applicants (Citizenship and Immigration Canada)

New Canadian Citizenship and Immigration Minister Chris Alexander this month welcomed Eric Byrne, a Canadian immigrant from Ireland, and one of the first individuals to become a permanent resident of the country through the Federal Skilled Trades Program (FSTP), in a press conference to promote the new immigration program.

Describing the program’s connection to the Canadian government’s broader economic goals, Alexander said:

“Our Government remains focused on job creation, economic growth and long-term prosperity. The new Federal Skilled Trades Program enables us to attract and retain skilled workers—like Eric—so we can address regional labour shortages and strengthen Canada’s economy.”

Byrne met the FSTP’s first requirement, a Certificate of Qualification from a provincial trades authority – in his case the Ontario College of Trades – in May 2012, and is currently employed as a plumber for University Plumbing and Heating.

He initially entered Canada through the country’s working holiday program, called International Experience Canada.

The reciprocal visa program allows the young adults of countries that Canada has a working holiday agreement with, like Ireland, to work and live in the Canada for a period of one to two years, while Canadian youth are given the same opportunity in the contracting country.

The program grants a maximum of 6,350 two year working holiday visas to Irish permanent residents and citizens per year. The visas have become highly sought after in Ireland, with the annual quota being met just two days after the program began accepting applications in 2013.

Part of new immigration selection strategy

The increasing reliance on the International Experience Canada program, the Canadian Experience Class (CEC), and new immigration programs that target foreign nationals with skills in demand in Canada, like the FSTP, for selecting new immigrants, began during Jason Kenney’s tenure as Citizenship and Immigration minister.

The aim of this new direction in immigration selection is to reverse the trend seen of highly educated immigrants arriving in Canada and having difficulty integrating into the economy, resulting in a growing employment and income gap between new immigrants and the general population.

By choosing applicants from countries more similar in language and economic structure to Canada, those who have Canadian work experience, and those who are certified to work in their vocation in Canada, the immigration ministry hopes new immigrants can immediately start contributing to the Canadian economy at the same rates as native born Canadians.

For his part, Kenney, who is now the Minister of Employment and Social Development, welcomed another one of the first successful applicants of the FSTP, Paul Lyttle, who is working as an electrician for Calgary-based Unitech Electrical Contracting Inc.

He promoted the program as a positive for the Canadian economy.

“The new Federal Skilled Trades Program is a significant improvement to Canada’s immigration system which, for too long, had not been open to in-demand skilled workers. Immigrants like Paul are set for success and I am pleased that this new Program will enable him, and others like him, to contribute skills to our economy on a permanent basis,” he said.

Two Occupations in Canadian Immigration Program Reach Sub-Cap

CIC’s most recent update shows 1,103 of the 5,000 spots in the quota have been filled for the Federal Skilled Worker Program (Government of Canada)

The Federal Skilled Worker Program (FSWP), the mainstay of Canadian economic class immigration, has reached the maximum allowable applications in two of the 24 eligible occupations.

The FSWP has a cap of 5,000 total applications, and a sub-cap of 300 applications per occupation, for the period between May 4, 2013, and April 30, 2014. Applications exceed either the total cap, or the sub-cap per occupation, will be disregarded.

In a recent update from Citizenship and Immigration Canada (CIC), financial and investment analysts and computer programmers and interactive media developers are shown as having reached their respective caps.

The total number of applications received in all occupation is currently at 1,103, leaving 3,897 spots left in the FSWP for the one year quota period.

Of the occupations still accepting applications, computer engineers (except software engineers/designers) is currently closest to its cap, with CIC reporting 116 applications received.

On the other end of the spectrum, CIC reports zero audiologists and speech-language pathologists applications received and only one application received for each of the mining engineers and petroleum engineers occupations.

Canada to Encourage Irish Immigration at Jobs Expo Dublin and Jobs Expo Cork

A street in Dublin, Ireland. Thousands of Irish job seekers are expected at the job expos being held in Dublin and Cork on September 6, 7 and 10 (Jean Housen)

At least seven Canadian companies will have a presence at this year’s Jobs Expo Dublin and Jobs Expo Cork, where they will promote the country as an ideal destination for Ireland’s skilled workers to find work and to settle.

The job expo, which is scheduled for Friday September 6th and Saturday 7th in Dublin, and Tuesday September 10th in Cork, will attract thousands from across Ireland seeking to assess the employment opportunities being offered. Dozens of companies from around the world will be manning booths at the event.

With Ireland now back in recession, immigration to Canada is becoming an increasingly attractive option for the country’s workers, whose skills, including English fluency and many with skilled trades qualifications, are well matched for Canada’s economy.

Among Canadian firms present at the expo will be CICS Immigration Consulting, which will be holding seminars on immigration to Canada in Dublin on Friday September 6th from 3pm – 3.45pm and in Cork on Tuesday September 10th from 5pm – 5.45pm.

Canadian immigration consultant and CICS principal Alex Khadempour will detail the main routes through which Irish workers can obtain work permits and permanent residency in Canada and provide a layout of the Canadian labour market and what immigrants might expect to encounter when they arrive in the country.

The job expo will run from 11am to 4pm in the Croke Park Conference Centre in Dublin and from 12pm to 6pm in the Silver Springs Moran Hotel in Cork.