October 26, 2021 – Canada stands below the top-performing countries in skills development, and has no comprehensive approach toward lifelong learning, according to a new report from the C.D. Howe Institute.
In “The Skills Imperative: Workforce Development Strategies Post-COVID,” authors Parisa Mahboubi and Momanyi Mokaya find that long-term unemployed and low-income, low-educated workers are slipping between the cracks.
“As the Canadian labour market recovers from the pandemic, adult education will be pivotal in ensuring that individuals have the right tools to adapt to the new skills the market demands, but there are important gaps in current federal and provincial programs,” says Mahboubi.
Automation, digital innovation, globalization and demographic shifts have been reshaping the labor market, leading to some long-term structural changes and redefining the skills required to maintain a productive workforce – a trend that has been amplified by the effects of the COVID-19 pandemic, write the authors.
The authors review the shortcomings of key current programs. For example, the federal government’s Canada Training Benefit, a universal skills development program, is intended only for employed Canadians who meet eligibility criteria and could permit marginalized groups to fall through the cracks. In particular, the requirements of being employed and having a minimum income of $10,000 prevent access to the program for the unemployed and those who are out of the labour force but need skills training to get to a job.
The 2021 budget also promised a $2.5 billion, five-year investment in skills and training to create opportunities for young and core-age individuals, mostly with the involvement of employers. The outcomes can be problematic. Evidence shows that businesses play a central role in providing training to their employees, but they invest less in low-skilled employees because of lower returns. However, the wider social returns from lifelong learning for adults with low qualifications can be high because it improves their employability, reduces their dependency on unemployment benefits and other targeted transfer spending and boosts inclusive growth.
“Although subsidies to businesses promote participation in lifelong learning, employers normally fail to address the needs of low-skilled employees,” says Mahboubi.
Another acute problem is long-term unemployment post-COVID. In September 2021, it stood 124 percent above the pre-pandemic level in February 2020. This unprecedented growth in long-term joblessness resulted in an increase in the proportion of long-term unemployment by about twelve percentage points to more than 27 percent in September 2021. A sizeable share of the long-term unemployed in September 2021 were unemployed for 52 weeks or more (63 percent) and prime-working-age adults (59 percent).
“In response, government programs should ensure early investments in skills development before unemployment drags on too long, as well as address barriers to training,” notes Mokaya.
The authors review lifelong learning strategies used in selected countries with strong adult learning systems: the Nordic countries, Germany and Singapore. Key strategies for success are:
- Developing strong partnerships with, and requiring the involvement of, all stakeholders;
- Developing a comprehensive system of lifelong learning that targets all vulnerable population groups;
- Addressing barriers to participation and offering a variety of high-quality flexible training options;
- Making information about programs more accessible and easy to find;
- And creating a platform to validate skills and allowing individuals to assess and identify their skills needs based on labour market information.
More broadly, the authors argue Canada needs a long-term, comprehensive skills development system, incorporating federal and provincial data, to promote lifelong learning – specifically a centralized body that organizes, manages and evaluates policies for adult education, training, and skills development, which has proven successful in other countries.
For more information contact: Parisa Mahboubi, Senior Policy Analyst, C.D. Howe Institute; or Lauren Malyk, Communications Officer, 416-865-1904 Ext. 0247, email@example.com
The C.D. Howe Institute is an independent not-for-profit research institute whose mission is to raise living standards by fostering economically sound public policies. Widely considered to be Canada's most influential think tank, the Institute is a trusted source of essential policy intelligence, distinguished by research that is nonpartisan, evidence-based and subject to definitive expert review.