Severe Labour Shortage in Western Canada

[Phantasee]

Financial Post

Claudia Cattaneo, Financial Post
Saturday, Jun. 23, 2012

For the past seven years, the mining community of Baia Mare in Romania's northern interior has eagerly stepped up to alleviate Alberta's labour shortages. For Joe Giusti, founder and chief executive of one of Western Canada's largest construction companies, it was a long way to travel to search for workers.

It was hard, too, once he found them. His firm, Giusti Group, had to teach recruits basic English so they would understand safety regulations. They had to meet rigid immigration requirements for temporary foreign workers. They had to be moved to an unfamiliar work environment, and sent back home just as they were getting used to their new jobs and way of life.

Yet Mr. Giusti was so encouraged by the enthusiasm shown by hundreds of young people who answered his calls for carpenters, cement finishers and general labourers, and by their performance in Alberta, he led recruitment missions there several times. Meanwhile, he was pleased to notice how the local community's economy flourished from a steady influx of Alberta oil cash, as people dressed better, bought new furniture and renovated houses.

"When I went to Romania the first time, it brought me back to the 1960s in Italy," said the builder, who since moving to Western Canada four decades ago from Treviso, near Venice, completed more than 50,000 multi-family units and took on some of the West's biggest industrial projects, even as he finetuned a passion for oil painting using Titian's colour techniques.

"I looked at them and I said: These are my people, like the ones from my village. I can see it in their hands. They are hard-working people. They can do anything."

Employers in Western Canada, and particularly in the ever-expanding oil industry, have been looking for workers farther and farther afield to fill jobs in resource development. The early favourites decades ago were farm kids from Saskatchewan. Then it was women and First Nations. Then it was Newfoundland. Then they brought in planeloads of workers from northern Ontario, Quebec and British Columbia in elaborate fly-in and fly-out schemes.

Today, with those sources tapped out and more and more projects on the horizon, the new fix is foreign labour.

While the practice is not new, what's changed is how many employers, who seem to be sticking with their growth strategies regardless of the state of the global economy, are looking to struggling countries to replenish their workforces - including advanced economies such as the United States and the United Kingdom.

Mr. Giusti is continuing to tap Romania's workforce and is looking in other foreign markets such as the U.S. for pump operators and mechanics, who must be fluent in English.

And yet he is watching with anxiety Western Canada's rising economy. With a staff of 500 and 200 job openings he is struggling to fill, he no longer accepts construction work in Calgary, while his family-owned company doubles down on work already underway, including a 1,500-worker camp and a processing plant for Husky Energy Inc.'s Sunrise oil sands project northeast of Fort McMurray.

"We are creating a mess," Mr. Giusti laments. "There is a boom, and there are few qualified people. Most of the jobs are done with unqualified people and improper workmanship. I would say lousy workmanship - and for a huge amount of money."

The push for foreign labour is in part a response to immigration reforms announced two months ago by Jason Kenney, the federal immigration minister, that opened up access to skilled tradesmen and make it possible for them to come to Canada as permanent residents, rather as temporary foreign workers.

Workforce pressures have been mounting for a long time. Western Canadian employers are concerned about Baby Boomer retirements and leakage to other sectors. They are worried that workers laid off in the 2008/2009 financial downturn may have left the industry. They complain that Canada's youth are snubbing trades because they don't consider them as prestigious, the work is hard and drug and alcohol use isn't allowed because of safety concerns.

Increasing foreign investment is also playing a role. International companies, from Europe to China, are clamouring to bring in their own staff to work on their projects.

While the growing list of megaprojects in the Alberta oil sands, Saskatchewan's potash industry, new pipelines, new liquefied natural gas projects in British Columbia is good news for Canada's economy, it also raises questions about who will do the work. The labour markets of Alberta and Saskatchewan, where most of the projects are based, are already the tightest in the country, each with an unemployment rate of 4.5% in May.

Projections show a staggering number of jobs will open up in coming years.

In a recent study, the Petroleum Human Resources Council of Canada predicted the oil and gas industry alone will need to fill 15,000 direct jobs between now and 2015, on an industry base of about 187,000, just to replace retiring employees or those moving to other sectors, and not including employees moving from company to company.

Growth projects beyond 2015 - when many major energy projects are scheduled to begin construction - aren't even taken into account. Even an economic pullback related to a softening global economy won't matter.

"Right now, [oil and gas] exploration and production companies are actually hiring more and retaining more than they need to given their current activity because they are preparing for growth and for the loss of experienced people," said Cheryl Knight, the council's executive director and CEO. "No downturn is going to eliminate that. It's more a structural issue. I believe these [economic] cycles are going to have less of an impact on hiring than they have in the past."

Ms. Knight said the oil and gas industry tends to hire new entrants right out of school, but there are not enough of them to replace the skills shortage that is looming because of retirements. That's one reason for the focus on foreign-trained workers.

The construction industry, which in Western Canada is heavily focused on projects related to the oil industry and other resource sectors, has even bigger job requirements. Mr. Kenney spoke of tens if not hundreds of thousands of job shortages in the skilled trades in the next decade when he announced the immigration reforms.

The Alberta government estimates there will be 114,000 more jobs of all kinds than people in the province in the next 10 years.

Mark Salkeld, president and CEO of the Petroleum Services Association of Canada, said his members have thousands of job openings and are aggressively pursuing foreign workers. Among the occupations in most demand are heavy-duty mechanics, truck drivers, welders, electricians, rig labourers, field supervisors and petroleum technologists.

"This sector has grown with respect to international exposure," Mr. Salkeld said. "We are getting experience in other countries. And we are seeing what's out there for talent, whether it's Russia, or South America, or Australia. There is a lot of talent that would work well in our industry and we are going after that. "Just like Australia is coming here, we are going there," he said, referring to a recent job fair in Calgary by some of Australia's top energy employers who are looking to recruit 100,000 people to man their booming energy industry.

Calgary Economic Development is planning recruitment missions in coming months to the United States and the United Kingdom.

In August, the agency is leading Calgary employers to Riverside County, Calif., where the unemployment rate is 12.8%, and to Clark County, Nev., where the unemployment rate is 12.1%.

The two communities have 25,000 unemployed construction workers who haven't had a paycheque for 90 weeks or more and don't expect one in the next three to four years because of the poor U.S. economy.

"If there is a way to move the economy forward, and provide opportunities so certain projects aren't shut down, we all prosper," said Jeannette Sutherland, manager of workforce and productivity with Calgary Economic Development.

"To know there is a motivated supply of workers [in the U.S.] with similar skill sets, on top of the supply that we have in Alberta, and employers are very interested in looking at options."

As part of the program, Calgary is working with business organizations in the two U.S. communities to facilitate the temporary workforce transfer.

More recruitment missions will be held in October in Ireland, where the unemployment rate is at a 20year-high of 14.4%, and in Scotland, where the unemployment rate is 10.4%. In both countries, many skilled workers are looking to leave, Ms. Sutherland said.

Mr. Giusti says Western Canada must increase its labour pool, or the consequences for many businesses and projects will be severe, including high costs and poorly built projects.

"Companies like us will close up," he said. "Our group cannot stay in business. I invested 40 years of my life to build up a business and I have no people."

Changing the Temporary Foreign Worker program is one thing Kenney has done right. TFWs worked here for 4 years with the understanding they would be sponsored for Permanent Residence status (which leads to citizenship) at the end of their contracts. Instead, the system was changed such that they couldn't come back to the country for 4 years after their term. This was fucking stupid and locked out a lot of experienced people we needed. Now they have an opportunity to actually immigrate here for more than a few years of work, which is win-win for everyone.

[amigocabal]

Changing the Temporary Foreign Worker program is one thing Kenney has done right. TFWs worked here for 4 years with the understanding they would be sponsored for Permanent Residence status (which leads to citizenship) at the end of their contracts. Instead, the system was changed such that they couldn't come back to the country for 4 years after their term. This was fucking stupid and locked out a lot of experienced people we needed. Now they have an opportunity to actually immigrate here for more than a few years of work, which is win-win for everyone.

I wonder if it would help for the Canuks to pay for California's high speed rail program and extend it to run all the way from San Diego, CA to Vancouver, BC. Would the extra tax revenues from the new workers' wages offset the costs?

[Phantasee]

Why the fuck would we pay for HSR in California? We wouldn't receive the taxes from the workers, the work would be done in the US.

And we're still short of workers for our own projects, at the end of it.

What part of your post made any fucking sense or had any relevancy to the OP? The worker shortage is in Alberta, Saskatchewan, and BC, but AB and SK have similarities in their problems while BC has enough differences to have what are really different problems, upon examination.

And none of that has anything to do with buildlng infrastructure in the US.

[Nieztchean Uber-Amoeba]

Yeah, between our current labour shortage and booming housing market (distorted by our city's staggeringly corrupt land and property development dealings) Regina is doing fairly well, but that same housing market, combined with our provincial government's refusal to consider any sort of rent control, mean that apartments here are becoming as or more expensive than those in Vancouver, which is just untenable no matter how well the economy does. One of the interesting side-effects of our current economic situation is how much less invisible our First Nations people are becoming. They've always been our largest minority but just 10 or 12 years ago were just completely shut out the economy and normal life. Things have changed enough that they're finally able to get hired outside of their own casinos, and young people from nearby reservations are coming to Regina able to both work and get an education (hopefully this might provide enough of a push to get FNU rolling again, but between the foundations of external racism and internal corruption that stopped it the first time I have few hopes).

[amigocabal]

Why the fuck would we pay for HSR in California? We wouldn't receive the taxes from the workers, the work would be done in the US.

And we're still short of workers for our own projects, at the end of it.

What part of your post made any fucking sense or had any relevancy to the OP? The worker shortage is in Alberta, Saskatchewan, and BC, but AB and SK have similarities in their problems while BC has enough differences to have what are really different problems, upon examination.

And none of that has anything to do with buildlng infrastructure in the US.

To make it easier for workers to immigrate to B.C..

[Solauren]

Why the fuck would we pay for HSR in California? We wouldn't receive the taxes from the workers, the work would be done in the US.

And we're still short of workers for our own projects, at the end of it.

What part of your post made any fucking sense or had any relevancy to the OP? The worker shortage is in Alberta, Saskatchewan, and BC, but AB and SK have similarities in their problems while BC has enough differences to have what are really different problems, upon examination.

And none of that has anything to do with buildlng infrastructure in the US.

To make it easier for workers to immigrate to B.C..

(WACK)

Just drive up the fucking coast, moron. It's not hard to move around North America. If you don't have the brains to figure that out, you'd never pass the immigration board anyway.

[Phantasee]

Are you suggesting driving on existing highways or taking a fuckig flight are not choices available today and we should instead construct HSR to transport workers from California to fucking Vancouver (which is at least 12 hours drive from where they are needed) at some indefinite point in the future, after we've already brought foreign workers in from literally ANYWHERE ELSE IN THE WORLD?

Get the fuck out of this thread.

[Solauren]

If you're going to work in BC/the Praires, move there.

[Phantasee]

If you're going to work in BC/the Praires, move there.

Exactly! amigocabal's posts are so fucking stupid they enrage me.

[Solauren]

If you're going to work in BC/the Praires, move there.

Exactly! amigocabal's posts are so fucking stupid they enrage me.

It's okay, I'm pretty sure they enrage everyone else too.

[Zaune]

I dunno actually. The US is Canada's primary trading partner, anything that makes shipping temporary workers into Canada and Canadian manufactured goods back to the US faster and cheaper has to be worth collaborating on.

[Phantasee]

But HSR in California wouldn't be to Alberta or Saskatchewan's benefit. If Alberta wanted to spend a pile of cash on HSR (which I believe we are slowly working towards) we would put down a line between Edmonton and Calgary (one of only two feasible locations for HSR in the country, the other being a Windsor-Quebec City corridor that touches Toronto, Montreal, and a lot of the heavily populated portions of Canada).

We've already solved the problem of transportation from California to Alberta: Interstate and provincial highways, and direct flights between SFO/LAX and YYC/YEG. That's not in any way a problem right now. What is a problem? Getting the human resources we need to fulfill the actual infrastructure projects we do need: highways and urban development in the north, on top of the massive projects being constructed in the oilsands in both provinces.

Which y'all would understand if you read the article.

[Surlethe]

How fast are wages rising in the Western provinces? Tear down immigration restrictions and let the law of one price work its magic.

[Blayne]

I was talking to a dude at a restaurant when this was playing on the tele, he had a friend who went over and only worked 3 days a week for 6 months and made 150,000$; just being a handyman like drilling screws and simple tasks can make you 80,000$, working for a Russian mining company up north pays double what the Canadian variant pays. I think I know what I'm considering for next summer in between semesters. The job demand is so high apparently they're taking virtually anyone from people I've been speaking to, will there still be jobs like this in a year? I don't know but it's worth a shot, worst case I'll go tree planting in BC.

[Nieztchean Uber-Amoeba]

It'll be a couple years at least before our economic bubble bursts, so at least in Saskatchewan there will still be plenty of opportunities on the rigs and refineries next year, and yeah, it's mostly well-paying jobs that require basically zilch qualifications, as long as you're happy with the kind of work that needs to be done.

[Vashon]

Sweet. Might just up and hop the border. Im white, so Ill just say "Eh?" a lot and blend in.


But seriously. What are the immigration laws?

[Blayne]

0_o

You might also want to significantly brush up on your french :V

As far as I know temporary work visa's mean its easy cause' NAFTA to hop over and work. It's just immigration that's hard, because we need to carefully ration out our healthcare doncha know eh?

[Vashon]

Fuck Quebec. And Creole is good enough anyway, right?

[Blayne]

Oh gee thanks.

[Phantasee]

Outside of a few francophone communities, French is barely spoken in Alberta and Saskatchewan.

As it is, good luck getting into the country. Jason Kenney, that insufferable prick, who I loathe for many reasons, recently suspended new skilled worker applications.

Blayne's friend that worked 3 days a week isn't very common, though. Usually it's more like work 3 weeks, 1 week off, or in my father's current case, 24 days on, 4 off. Lots of work to be done, lots of overtime to be earned.

@Surly: wages are starting to rise already, but I don't have numbers for you. Last time the boom went supernova on us and the worker shortage was so severe, McDonald's was hiring part timers at $14.50 an hour or more (up from minimum wage which was IIRC $7.50 or $8), and still short of staff. Skilled labour shortage is occurring right now, but general labour shortages will follow within the next year.

[Phantasee]

Globe and Mail with unemployment figures: http://www.theglobeandmail.com/report-o ... le4394016/

A quick look at June unemployment (previous month in brackets):

Unemployment rate: 7.2 per cent (7.3)

Number unemployed: 1,354,500 (1,378,600)

Number working: 17,509,700 (17,502,400)

Youth (15-24 years) unemployment: 14.8 per cent (14.3)

Men (25 plus) unemployment: 6.1 per cent (6.4)

Women (25 plus) unemployment: 5.5 per cent (5.9)

By province
Here’s what happened provincially (previous month in brackets):
•Newfoundland 13.0 (12.0)
•Prince Edward Island 11.3 (11.3)
•Nova Scotia 9.6 (9.2)
•New Brunswick 9.5 (9.4)
•Quebec 7.7 (7.8)
•Ontario 7.7 (7.8)
•Manitoba 5.2 (5.1)
•Saskatchewan 4.9 (4.5)
•Alberta 4.6 (4.5)•British Columbia 6.6 (7.4)

By city
Statistics Canada also released seasonally adjusted, three-month moving average unemployment rates for major cities but cautions the figures may fluctuate widely because they are based on small statistical samples. (Previous month in brackets.)
• St. John’s, N.L. 7.3 (7.7)
• Halifax 6.8 (6.3)
• Moncton, N.B. 6.9 (6.8)
• Saint John, N.B. 7.8 (8.2)
• Saguenay, Que. 6.1 (6.1)
• Quebec 5.0 (5.1)
• Sherbrooke, Que. 7.7 (7.4)
• Trois-Rivieres, Que. 8.2 (8.4)
• Montreal 8.8 (8.9)
• Gatineau, Que. 6.1 (5.8)
• Ottawa 5.9 (6.1)
• Kingston, Ont. 5.9 (6.2)
• Peterborough, Ont. 8.2 (9.2)
• Oshawa, Ont. 8.2 (8.2)
• Toronto 8.6 (8.6)
• Hamilton 7.3 (6.8)
• St. Catharines-Niagara, Ont. 8.1 (7.7)
• Kitchener-Cambridge-Waterloo, Ont. 6.9 (6.8)
• Brantford, Ont. 8.4 (8.3)
• Guelph, Ont. 5.1 (5.5)
• London, Ont. 8.5 (8.3)
• Windsor, Ont. 9.5 (9.9)
• Barrie, Ont. 7.9 (9.1)
• Sudbury, Ont. 7.4 (7.2)
• Thunder Bay, Ont. 5.7 (5.7)
• Winnipeg 5.4 (5.4)
• Regina 4.0 (3.9)
• Saskatoon 5.5 (5.6)
• Calgary 4.8 (4.9)
• Edmonton 4.4 (4.9)• Kelowna, B.C. 7.3 (9.2)
• Abbotsford, B.C. 7.2 (7.9)
• Vancouver 6.4 (6.4)
• Victoria 5.3 (5.2)

Regina has the lowest rate in the country, followed by Edmonton and Calgary. Don't know what's up in Saskatoon there.