Syed Khan – December 13, 2021
Canadian businesses are in dire need of new employees amidst long standing labor shortages even as the economy recovers post-pandemic.
In the findings published by the Canadian Federation of Independent Business (CFIB), more than 50% of small businesses in Canada have been affected negatively by labor shortages. They are facing difficulties in hiring staff and retaining them. Most of these businesses report a lack of skilled workers applying.
The report by CFIB explains the reasons why labor shortage conditions became so critical, the issues that existed before the onset of the pandemic, the role the pandemic played and the most effective solutions to help small business now and in the future.
According to CFIB’s Small Business Recovery Dashboard, over 33% of small businesses surveyed in the report have turned down sales or contracts and 30% have abandoned or delayed projects due to labor shortages.
Almost 22% surveyed also reported having temporarily reduced their staffing and 8% have permanently reduced their staffing or shut down their business. This labor shortage has been exacerbated by the COVID-19 pandemic but the lockdown is not the main cause for it.
Quote by Corinne Pohlmann, senior vice-president of national affairs at CFIB:
“Small businesses have a long and steep climb to recovery, and having the right workers in place or other tools to address labor shortages is a big part of that. They are already doing all they can to attract workers, but they need governments to do their part by adopting policies that increase productivity, connect job seekers with employers and don’t put the cost of hiring out of reach.”
Four in 25 businesses have reported having enough staff, but said they incur heavy additional costs to maintain the business as they have either increased minimum wages or provided hiring bonuses, a move which is uneconomical in the long run in maintaining small businesses. Rising higher wages imply higher labor costs, which in turn forces up prices and generates inflationary pressure.
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