The BDC has released a report putting the number of Canadian SMEs (small and medium-sized enterprises) struggling to find talent at 39 percent, nothing that this problem will persist over the next decade.
Based on survey answers from 1,208 entrepreneurs, the report details how the struggle to find talent can affect the bottom line: firms most affected by labour shortages are 65 percent more likely to generate low sales.
Nearly six in 10 entrepreneurs said the labour shortages meant existing staff had to work more, while 47 percent said they have had to raise wages. Business owners are also forced to spend more time working on the front line due to a lack of workers, which means less time spent on developing the business.
The problem is most acute in Atlantic Canada, British Columbia, and Ontario, with manufacturing, retail trade, and construction the hardest hit sectors. The severity of hiring challenges peaks for firms with 20 to 49 employees, and then drops for firms with 100 or more employees.
“Labour shortages are affecting growth for many Canadian businesses, and this has an impact on Canada’s competitiveness,” said Pierre Cléroux, VP of research and chief economist at BDC. “Businesses are being forced to refuse orders or delay deliveries. To help deal with the impact, entrepreneurs should think about hiring from under-represented segments of the population, such as younger or less-qualified workers, retired workers or newcomers to Canada.”
BDC recommends several strategies for mitigating the impact of labour shortages, including formalizing HR policies to improve retention, hiring workers from underrepresented groups—such as newcomers—and improving operational efficiency through key performance indicators and process maps.
Access the full report here.