Province-wide skills gap hinders Ontario's economic activity
TORONTO, June 21, 2013 /CNW/ - Ontario is losing out on as much as $24.3
billion in economic activity and $3.7 billion in provincial tax
revenues annually because employers cannot find people with the skills
they need to innovate and grow in today's economy, according to a
Conference Board of Canada report released today.
"This is money that could provide substantial economic and social
benefits to Ontarians. Closing the skills gap could help the province
reduce public debt or invest in much needed infrastructure
improvements," said Michael Bloom, Vice-President, Organizational
Effectiveness and Learning. "Consider, for example, that a proposed
expansion of public transit in the Greater Toronto-Hamilton Area would
require an estimated $2 billion per year, over 25 years, to complete."
While much has been written about Ontario's skills challenges, little
has been done to examine their true economic costs, and what can be
done to prevent a skills crisis.
The Ontario economy is also losing out due to skills mismatches -
individuals who are employed in jobs that fail to fully utilize their
skills and training.
Better linkages between employers and post-secondary institutions, and
among post-secondary institutions themselves, will improve
workplace-based experiential learning.
Skills gaps currently affect much of Ontario's economy, including
sectors that account for almost 40 per cent of employment:
manufacturing; health care; professional, scientific, and technical
services; and financial industries. Skills gaps are projected to worsen
if action is not taken.
"Ontario cannot afford to live with a skills gap of this magnitude. The
need for action is urgent, since changes in education will take years
to bear fruit in the labour force," said Bloom.
To get a clear picture of employers' skills needs, the Conference Board
conducted the Ontario Employer Skills Survey. More than 1,500 Ontario
employers, representing over 760,000 employees (13.5 per cent of the
workforce) from across the provincial economy, responded to the survey.
Survey results show that employers most need post-secondary graduates in
science, engineering, and technology; and business and finance. The
most widespread needs are for employees with two- or three-year college
diplomas (57 per cent); four-year degrees (44 per cent); and trades (41
The negative impact on the Ontario economy goes beyond the issue of
skills shortages. Another issue with economic consequences is skills
mismatches in the labour force -individuals whose skills and training
are not being fully utilized in the jobs they have.
The Conference Board estimates that these mismatches, by themselves,
cost Ontario's economy and workers up to $4.1 billion in foregone gross
domestic product (all GDP figures in 2002 dollars) and $627 million in
provincial tax revenues annually (all tax revenue figures in current
dollars). Many post-secondary education graduates have skills and
training in sectors with few available jobs. In addition, employers
sometimes fail to make the most of their employees' skills and talents.
Many stakeholders have a role to play - individually and collaboratively
- in alleviating Ontario's skills gaps:
Employers can increase their training and development investments and
provide more experiential learning opportunities—such as
apprenticeships, co-op placements, and paid internships.
Educators can better align programs to the needs of the economy.
Governments can allocate additional resources for experiential learning
opportunities, and collect and share better labour market information.
Students can match their own education and training planning to the
realities of the labour market.
The report, The Need to Make Skills Work: The Cost of Ontario's Skills Gap, was issued today at the Closing the Skills Gap conference at the Sheraton Centre, Toronto. Michael Bloom will speak at
The research was prepared with financial support from Colleges Ontario.
SOURCE: Conference Board of Canada
For further information:
Yvonne Squires, Media Relations, Tel.: 613- 526-3090 ext. 221
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