Small Business: Too Big to Ignore
Small and medium-sized enterprises (SMEs) are the backbone of the Canadian economy—accounting for more than 90 percent of jobs in the private sector. Despite their central role in employing Canadians, SMEs are often pushed to the margins in discussions about future skills and policy development.
To remain competitive with larger organizations in Canada and across the globe, Canadian SMEs need the right talent with the right skills. Yet new research shows that critical labour shortages and skills gaps are capping their potential.
The Diversity Institute recently launched a new report in the Skills Next (external link) series in partnership with the Ontario Chamber of Commerce (external link) , Public Policy Forum (external link) and the Future Skills Centre (external link) during a webinar and panel discussion exploring critical issues facing small businesses in Canada. Small and Medium Size Employers (SMEs): Skills Gaps and Future Skills examines existing knowledge and approaches to skills among Canadian SMEs, and highlights key areas for further research.
President and CEO of the OCC Rocco Rossi (external link) opened the floor and introduced speakers Pedro Barata (external link) (Executive Director, Future Skills Centre) and Donna Skelly (external link) (MPP for Flamborough-Glanbrook) to share how their work is developing a deeper understanding of the skills Canadians need, and helping to bridge the gaps between businesses and the right talent.
Dr. Wendy Cukier, Founder and Academic Director of the Diversity Institute and Research Lead at the Future Skills Centre, and Ashley Challinor (external link) , Vice President of Policy at the OCC, set the stage for the panel discussion by outlining key findings from the new report.
From 2013 to 2018, SMEs were responsible for over 70 percent of net employment growth in Canada, with small businesses accounting for well over half of that growth. “SMEs are really punching above their weight in their contributions to the economy,” Challinor explained.
However, many SMEs identified labour and skills shortages as a critical threat to their success. SMEs, often without an HR department to rely on for guidance, are struggling to find individuals with essential skills including technical competencies, management and leadership abilities, and “human skills” like the ability to work collaboratively and maintain strong relationships. These gaps may lead to existing employees having to work more hours, delays in fulfilling orders, and limited growth potential.
The impact of COVID-19 has made these issues even more acute—particularly for small businesses and microbusinesses. Businesses led by women and diverse entrepreneurs, that often tend to be newer, smaller, under-financed and concentrated in sectors most affected by the pandemic, are in an especially precarious position.
Dr. Cukier noted that organizations may be looking in all the wrong places for qualified talent. “We have evidence that there are many highly qualified workers that are underemployed, particularly if they have credentials from outside of Canada,” she explained. People with disabilities also remain largely underemployed in Canada. For instance, a university graduate with a severe disability has worse employment outcomes than a high school dropout does. Organizations may also develop the talent they need to meet their goals within their own staff. Research has shown that those that invest in training and upskilling programs, Dr. Cukier explained, get good payoff.
Dr. Cukier and Ashley Challinor both emphasized the importance of a sectoral and regional approaches to understanding the varying dimensions of the issues facing SMEs. Dr. Cukier argued that it is also important to clearly define the skills that Canadian employers need, and recognize that SMEs are in need of different types of skills than large organizations. Targeted supports that help Canadian SMEs fill the labour and skills gaps that are holding them back, especially amid a crushing pandemic, are essential.
“We have to think about these small businesses, start-ups, and microbusinesses as the seedlings that are going to grow our economy—and we can’t let them die,” Dr. Cukier explained.
In Conversation with Women Entrepreneurs
For many small businesses and entrepreneurs in Canada, the impacts of COVID-19 have been crushing. At the same time, businesses with the talent and expertise to pivot online and take advantage of new opportunities have been able to flourish.
Michelle Eaton (external link) , Vice President of Public Affairs at OCC, moderated a fascinating panel discussion with women entrepreneurs grappling with the opportunities and challenges brought on by COVID-19 that featured Andria Barrett (external link) (President and CEO, Canadian Black Chamber of Commerce), Lesley Gouldie (external link) (President and CEO, Thornhill Medical), Melissa Hardy-Giles (external link) (Owner, ORIGIN), and Jennifer Turliuk (external link) (CEO, MakerKids).
Andria Barrett explained that at the Canadian Black Chamber of Commerce, the phone has been ringing off the hook, and echoed the pressing need for additional support for small businesses and microbusinesses. “To be completely honest, it is devastating. The impacts that our membership is facing, which goes right across the country, they are having trouble pivoting, they are having trouble accessing capital, they are having trouble sustaining and surviving.”
Lesley Gouldie’s organization, a developer and manufacturer of mobile medical products, was called upon by the Ontario and federal governments to provide new technology in the effort to treat those hospitalized with COVID-19. The challenge they faced was in scaling up their company in a very short amount of time in order to meet the new demand. This required engaging HR consultants to fill labour shortages and build a workforce capable of sustaining the business in the long-term.
Melissa Hardy-Giles found that flexibility and adaptability were essential to adapting her business to the current landscape. While the rapid shift to digital accelerated the need for high-quality and reliable internet connection across the country, many in remote or Indigenous communities continue to face limited broadband access. In response, Hardy-Giles worked to provide folks with limited internet access with devices preloaded with her workforce development VR-based tools so that they may benefit from her services despite the infrastructure challenges they face.
As the owner of a maker camp hiring instructors virtually for the first time, Jennifer Turliuk faced similar barriers and opportunities. For instance, it has proven difficult to hire instructors in areas that do not have strong and reliable broadband access. Those without strong digital skills and comfort in leading workshops online have also been put at a disadvantage. Where possible, Turliuk’s company has offered employees assistance with internet plans that can better accommodate the needs of online instruction. At the same time, Turliuk has now been able to include young learners from the Caribbean and Europe in her programming by pivoting her businesses offering online.
All three levels of government, panelists explained, can support small businesses during this challenging time through procurement. Gouldie explained that there is no shortage of innovation in the medical and life sciences sector among Canadian SMEs, but the slow adoption of locally-developed products remains a significant challenge that is exacerbated by labour shortages and skills gaps. Governments can set a powerful example by buying local and supporting Canadian-made products while fuelling the growth of Canadian SMEs.
Looking ahead to what skills and training Canadians will need to be successful in the future of work, panelists stressed the importance of flexibility, adaptability and transferable skills. Barrett added that it is important to remain open to always learning and reskilling.
“This is a time when there are new problems, and new opportunities,” Turliuk explained.
Learn More and Connect
Read Small and Medium Size Employers (SMEs): Skills Gaps and Future Skills for a closer look at the issues facing SMEs in Canada.
If you are struggling to find the right talent to support your business’ needs, or find employment with an organization that may benefit from your expertise, Magnet (external link) can help. Sign-up (external link) for a free account as an employer or job seeker to get started.