Back view of 2021: labor shortage clouds over sunny Quebec economy

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Montreal retailer Bram Naimer did something this fall that he had never done since he first invested in his family’s home furnishing business nearly 30 years ago: He had staff put up a “Help Wanted” sign on the showroom.

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“It’s very hard to find people,” said Naimer, whose Union Lighting store on Décarie Blvd., founded by his grandfather’s brother in 1914, now has about 100 employees. “We are struggling to find an ATM, a hall for when people come in. We are continuously looking for people. In previous years, you would email all employees and in 10 seconds you would get four referrals. It was never complicated. “

A similar story unfolds in St-Henri en L’Ambroisie, a French restaurant near the Lachine Canal. Co-founder and director of business development Fanoue Fortier says nothing in her 15-year career as an entrepreneur prepared her for the difficulty of finding dozens of new workers on short notice when her business and an adjacent event venue, L’Espace Canal, reopened. in June after an eight-month pandemic-induced shutdown.

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“We advertise on almost every site, be it Indeed, Jobboom or Emploi Québec, but it hasn’t been easy,” said Fortier, who runs the business with his partner, Ontario-born chef Stuart Abrams. “For a while we had no one applying. You could almost hear the sound of crickets. “

As the coronavirus pandemic approaches its second anniversary, Quebec’s acute labor shortage shows no signs of abating.

64% of small businesses in Quebec cannot get all the staff they need, according to a December 9 report from the Canadian Federation of Independent Business . That is the highest ratio anywhere in Canada.

The government of Prime Minister François Legault last month announced measures aimed at guiding students toward key sectors such as information technology and healthcare, but those incentives will likely take years to produce results.

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Employer groups like the influential Conseil du Patronat du Québec wasted little time criticizing the government’s refusal to use a key but politically sensitive tool that would have produced faster results: permanently increasing the province’s immigration quotas. Only a temporary increase, to about 70,500 immigrants, was announced for 2022.

Quebec also failed to introduce new financial incentives aimed at convincing older workers to continue working past retirement age, much to the chagrin of corporate lobbyists.

The labor shortage, which was already a problem before COVID-19, has worsened over the past 22 months. More than 279,000 positions were vacant in Quebec in September, data from Statistics Canada shows. In November, Quebec’s unemployment rate had fallen to 4.5 percent, its lowest level since February 2020.

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To make matters worse, Quebec’s working-age population is projected to shrink further in the next decade.

Meanwhile, Quebec’s economy is picking up speed, increasing pressure on employers eager to meet demand. The province’s gross domestic product will grow 6.5 percent next year, according to a finance ministry forecast released on November 25.

Seventy-three percent of Quebec companies in a recent survey of Canadian manufacturers and exporters said they will likely increase 2022 wages by at least 3 percent to attract staff. Of that group, 43 percent are targeting salary increases of more than 5 percent.

The problem is that even better pay may not be enough. Although 86 percent of Quebec’s small businesses say they have increased wages, many still cannot find qualified employees. Only 25 percent of Quebec companies that responded to the CFIB survey said raising wages was successful.

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“The competition for talent is about to get even tougher,” said Véronique Proulx, director of the 1,100-member Manufacturiers et Exportateurs du Québec association. “A year from now, we will continue to talk about the effects of the labor shortage.”

For companies already grappling with supply chain bottlenecks and high raw material prices, the workforce situation adds an unwanted layer of complexity at a time of increased risk.

“Manpower is our number one problem by far,” said Hugue Meloche, CEO of aerospace parts maker Groupe Meloche, a supplier to Bombardier and Airbus with about 300 employees. “Whenever we have the opportunity to sign a contract or make an investment, the first thing we ask ourselves is: do we have the manpower to deliver the products? A few years ago, we wouldn’t even have thought about it. Work has become a major impediment to growth ”.

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As a result, employers are pulling other levers. In the service industry, companies like L’Ambroisie have the ability to offer on-the-job training as a recruiting tool.

“We have been training chefs for 15 years, which is a way to attract talent,” Fortier said. “Eventually they go elsewhere, but at least we have them for a few years. My partner always says, ‘If you can’t buy them, you make them.’

Other companies are stepping up their efforts to hire temporary foreign workers and automate the output.

“In the very short term, the solution for us is the temporary foreign worker program,” said Meloche. “Everything that can be automated must be automated, but people are still needed. Eventually, it is clear that if we ever have the opportunity to land a great contract and we are not sure we have enough people in Quebec, my board of directors will push me to invest elsewhere. “

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