Canada

Canada Faces A Huge Trade Worker Shortage, and It’s Going To Cost You More

Young Canadians aren’t interested in joining the trades, and it’s a big problem. RBC Economics took a look at skilled workers, and the anticipated shortage. The labor shortage isn’t just due to a large demographic cliff though. Not enough young adults are attracted to the field, nor are new immigrants. This squeeze can result in much higher costs for households, especially for housing.

Canada Will Face A 60,000 Person Shortage of Skilled Worker Apprentices By 2025

Canada is failing to attract more trade workers, and it’s going to add up really fast. The number of registered apprentices needed to stem the shortage is expected to rise to 60,000 by 2025. This is partially due to the pandemic’s lingering impact, which saw registrations drop 37%. A steep drop, for an area already hurting for recruits. 

The number of skilled tradespeople across all skilled industries is falling. RBC sees a shortage of 10,000 skilled tradespeople in just 56 high-demand Red Seal Trades. The deficit is forecast to be 10x larger when all 250 regulated trades are included.

An Estimated 700,000 Tradespeople Are Estimated To Retire By 2028

The trade worker shortage is going to be complicated by a demographic cliff. RBC estimates 700,000 trade workers retiring by 2028. If this happens on that schedule, an even bigger shortage can materialize. Further, another 1 million of the 4 million trade workers need “upskilling” in the next 5 years. This is additional training to update their skills to new methods of delivery.

Canada has tried to fix this with its universal demographic spackle — immigration. The Federal Skilled Trades Program seeks to attract 3,000 skilled workers per year. It doesn’t appear there’s much demand for it though, because fewer than 2,400 people got the visa. Immigrating to be skilled labor isn’t that appealing at current wages, apparently.

Labor Shortages Mean Higher Households Costs

The skilled labor shortage is already contributing to higher home prices. Construction had 46,000 job vacancies in Q1 2021, the highest on record. Almost two-thirds were specialty contractors, such as masonry, painting, or electrical work. In other words, the people needed to build homes.

Rising labor costs, or a lack of labor, have been a huge contributor to rising building costs this year. Average weekly earnings jumped 9.5% in just 12 months, almost 9x greater than average. Those costs get passed onto consumers since builders aren’t a charity. The faster homes get built, the more labor gets squeezed, the greater the rise in costs. Who knew building more can sometimes make home prices more expensive? I mean, the industry does. But it’s never been more apparent why.

Fast-rising costs are said to be transitory, but that might only be true for the material portion of costs. Labor and labor-intensive industries still face a big shortage of workers. In the short-term, this is unlikely to be resolved due to the sheer scale of the problem. It can actually be intensified by the massive stimulus-driven public infrastructure projects planned.

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17 Comments

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  • JM 4 weeks ago

    Working on eliminating the toxic, female-unfriendly, mysogynistic and racist culture prevalent in the trades would help immensely.. Increased focus on health and safety too probably wouldn’t hurt instead of Machismo-dominated blather.

    Also, recruit immigrants who are only tradesmen then, and make them work in the trades, 5 years + as a condition of their immigrating. Not unprecedented.

    All this would help a lot.

    • Axel McLion 4 weeks ago

      Lol. Sending more women into trades is not the answer. Rather the opposite. Physical labor would turn some of the soy boys back into men.

      • JM 4 weeks ago

        If you watched Marketplace I believe (it was last night or the night before) they had a large segment on two men (african-american skin colour) who were in the trades. I think it was work in the Oilsands. One had been working there for 15-20 years and left, the other still trying to get permanent work (was only getting contracts). It wasn’t a perfect segment but should give some insight. They described widespread overt racism /racist comments constantly (especially 10+years ago, may be slightly better now), and the typical toxic culture I’ve encountered in the trades many times. The rest of the world has moved on. Alberta and the trades haven’t (and I’m from Alberta, and have worked labour and with tradesmen).

        All that BS isn’t necessary nor does it make for better work (or a work environment). I know the jobs are hard work and aren’t easy, but they’re driving people away.
        Youth don’t aspire to do it either at all, regardless of their educational ability or backgrounds and the rediculous money it pays (that it didn’t pay 30 years ago). Wonder why that is. Yes, part of it may be that people ‘don’t like hard-work’ (ok, boomer), but part of it is also the culture.

        • Axel McLion 4 weeks ago

          Some people want to blame white men for all problems in the world, maybe you’re one of those people, but real life is much more nuanced. The reality is that racism is a deeply ingrained part of life. People should not immigrate to a foreign country if they aren’t able to deal with it. But you are talking about some small conflicts, this is not something that explains widespread worker shortages. There is not some large conspiracy to keep immigrants out of trades. In fact, there are many companies in the trades that are owned by immigrants and that employ mostly immigrants (can’t fault them any more than I can fault white men for preferring to stick together).

      • Kaliucla 4 weeks ago

        Hah, what in God’s name are you on about?
        You do understand that a labor shortage means not enough people are signing up for the job, right? Excluding women from the work force effectively cuts the potential pool of applicants in half.
        The belief that physical labor would somehow enhance this antiquated idea of masculinity is pretty funny too. As if effeminate gay men don’t hit the gym.

        • Average Man 4 weeks ago

          Those dudes do love the gym

        • Mike 3 weeks ago

          Trades crap pay , dangerous, surrounded by idiots and one of the last bastions for white male dominance. Rather be a delivery boy than support that system . Go do it yourself!! 15 years of concrete and nothing but a broken body to show for it . All colored kid should stay away , you will never get a fair deal in trades .

      • Ninja 4 weeks ago

        OR/

        Physical labor is a supply-based market just like any other employment market, and trying to distil everything down to a pro-women/anti-women act will just artificially restrict/handicap the supply/value of the workforce, potentially making matters worse.

        Maybe we should continue to hire based on merit, and let the market decide what PERSON is best, to focus on the issue of supply, rather than pretending like we have the luxury of choice between what’s between people’s legs 💀.

    • Jason Azevedo 4 weeks ago

      This is not true whatsoever. In Masonry women get treated as equal in IUBAC Union. Here in Windsor this is not true. Do you even work in the skilled trades?

      • Olly 3 weeks ago

        Maybe Canada should not have deported all those Portuguese tradesmen back in 2006. They were screwed over bigtime when they were sold on a path to immigration and citizenship.

  • Chris 4 weeks ago

    I am a skilled toolmaker. I went to school,got my ticket and built dies and plastic injection moulds in the gta for several decades. Salaries plummeted after china took over the world market by undercutting the price of plastic injection moulds. I would never advise any youngster to enter that trade now. It is too unstable. Salaries for skilled trades need to go up. There needs to be more help for companies that make things here in Canada to train these youngsters……….not more schools.That method is no good in the trades.Learn on the job, doing the slog work first and then moving up through the ranks……not rocket science. We could do this by using taxpayer money to subsidize apprentice salaries. Schools are expensive to build and very expensive to run. Small business has built Canada before,hopefully it can do it again.

  • D 4 weeks ago

    Trade workers we have now are generally lazy and want overpay for shoddy service. Everything around the GTA looks dilapidated compared to real global cities like Tokyo, Frankfurt, London, NY, LA…

  • Ksnn 4 weeks ago

    Inflation is at historical high, we just jacked up our money supply. I don’t see how real estate prices are coming down with out some way to recall all that liquidity. If a crash does happen Toronto and Vancouver will probably see the worst of it.

    • Axel McLion 4 weeks ago

      Prices will come down if and when we stop pumping more and more liquidity into the system. All that housing is owned via debt, and Canadians cannot pay that debt without this continual addition of liquidity. We have a very weak economy.

      So the question is whether this occurs, or we print money until the there is a currency crisis. Either way, Canadian home owners lose. Only way you can really win is by selling at the peak and leaving Canada, but it’s unclear where you’d go as most of the world is in a similar or worse situation.

  • Mike 4 weeks ago

    I work as a skilled tradesmen in the flooring industry.10 years ago was the last time l had a helper at 20per hour.Can’t find anybody who wants to learn the trade and don’t blame them at all.Trades are hard to learn and the work is hard.Now work 60 hours a week and you will never be able to own a house.Used work truck with over 200000 km is well over 15000 dollars for at least 10 years + insurance+maintenance and they don’t last long.It’s just not worth it anymore.Lot’s of kitchen table talk going on right now.Service jobs low pay that women have always done. Well no more get rid off the car insurance and maintenance with some daycare.Why work for that extra couple bucks a month you can stay home take care of the house and still be a Mom to your kids.Which Mom got a taste of the ladt year.People are not coming back data is in from states that pulled support cheques earlier and still no absorption.Times have changed trades have no problem with women and l would love to hire anybody.Inflation has killed lots of careers and it’s not getting any better.

  • Cto 3 weeks ago

    Blame the high school educators…
    30 years ago guidance councilors were telling kids like me to stay out of the trades because technology would make them redundant in a few years, they have been brain washing kids in Canada ever since.
    Turns out the kids that got into trades are massively financially better off by age 40 than 50% of uni-grads and very happy and proud of who they are.

    • tr 3 weeks ago

      I echo your sentiments. There are electricians and plumbers who earn more than some MBA’s and Phd’s.

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