Skilled Labour Shortage in Canada's Construction Industry - Thesis Example

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This paper captures a comprehensive study on Skilled Labour Shortage in Canada's Construction Industry.
Hence, the construction industry is thriving, injecting billions of dollars in economic activity into the state. Nevertheless, due to increasing economic growth, the industry is facing a skilled labour shortage.

Executive Summary
The Canadian construction industry is a massive, multi-billion dollar industry employing close to 1 million individuals. Nationally, the construction industry is thriving, injecting billions of dollars in economic activity into the state representing 12% of Gross Domestic Product (GDP). The construction industry includes workers employed in a wide array of occupations and settings and comprises five sub-sectors. However, due to increasing economic growth, the industry is faced with a growing skilled labour shortage.

There are several reasons for skilled labour shortages to occur and persist. One of the most critical reasons is the ageing of the workforce in the construction industry. A corresponding decline in the number of young people available to enter the labour market has compounded the problems faced due to the ageing of the workforce. Parents and counsellors view construction as a low-level, backbreaking job. The lack of a proper and effective educational and apprenticeship training system has not helped in any way to improve the already negative image of the construction industry. Shortages also occur due to the short-run and cyclical economic demand. The construction industry heavily relied on immigrants in the past. This source of labour has now dried up and the failure to develop an indigenous response to this shortage is evident. Under-representation of women as a potential source of future labour in the construction industry has thinned the already shrinking labour force.

Labour shortages in construction have a wide range of consequences. The bottlenecks that inhibit the hiring of complementary workers can lead to possible wage cost escalation. Shortage of labour can result in restricted output and lengthy delays. This could possibly lead to higher prices and inferior quality of construction. Extra workload on the compact labour force may increase health and safety hazards. There also might be a shift to the underground economy and to prefabricated substitutes.

1 – INTRODUCTION
1.1 - General
The construction industry is Canada's largest and most diverse industry. It plays a vital role in making Canada one of the best places in the world to live, work, and raise a family. The industry not only provides employment to large numbers of workers but also has far-reaching effects on the economy of regions across Canada. The industry represents 12% of Gross Domestic Product (GDP) when considering its impacts on all sectors of the economy, and it maintains and repairs over $5 trillion in assets (A Snapshot of the Construction Industry 2001). According to the Construction Sector Council (CSC), one out of every 17 Canadians makes a living from construction. Hence, it employs close to 1 million Canadian men and women and chalks up volumes of $123 billion annually.

The construction industry comprises five sub-sectors: residential construction, industrial, commercial and institutional construction (ICI), heavy construction (roads, sewers and water mains), power systems, and heavy engineering. These sectors vary considerably in terms of union organization, size of firms and seasonality. The residential sector is largely unorganized whereas the power systems, heavy engineering, and heavy construction sub-sectors are largely unionized. Similarly, larger firms characterize the ICI sub-sector and have less seasonality than is typically the case in the residential sub-sector (McQuillan 1999). ...Download file to see next pages Read More