The Human Resources Environmental Scan for the Public Service of Canada - A Tool for Identifying Current and Future Human Resources Needs

Research and Analysis Directorate

HR Planning, Accountability and Diversity

September 2005

Acknowledgements

The Research Directorate is indebted to the Environmental Scan and Current and Future Needs team that have turned this project into a reality within a very tight time frame. The Human Resources Environmental Scan Advisory Committee has played a major role in providing advice and direction on the nature and contents of this report. Our thanks go out more particularly to Christine Coffey, Director General, Statistics Canada, and Brian E. Lynch, Director, PSHRMAC, for co-chairing the Committee and actively supporting the project.

Comments and suggestions from members of the Human Resources Planning Interdepartmental Network and of the Interdepartmental Human Resources Planning Working Group have been extremely useful in reviewing the report and improving its quality.

Our thanks go to Eric Beauchamp of PSHRMAC's Research Directorate for his continuous administrative support.

To all who have contributed their support and collaboration, the Environmental Scan team of the Research Directorate is thankful.

About this Report

This Human Resources Environmental Scan for the Public Service of Canada is designed to help federal departments and agencies better understand their operating environment, and improve their human resources planning by facilitating the identification of their current and future human resources needs. Through a review of recent human-resources-related developments and trends, this report outlines the main issues and challenges that are expected to affect human resources management within the Public Service over the coming years.

This first report is based on information available as of November 2004 and scans the environment, both internal and external to the federal Public Service. This report will be updated regularly to reflect environmental changes. A condensed version of this report was disseminated in March 2005. While the material presented in both versions is consistent, the richness of detail in this longer version required additional structure. The condensed version was a high-level view designed for quick consultation, while the long version comprises a detailed reference for HR professionals, managers and decision-makers.

About the Agency

The Public Service Human Resources Management Agency of Canada (PSHRMAC) was created in December of 2003 in support of the Government's agenda for renewal of human resources management throughout the Public Service. It focuses primarily on the implementation of the Public Service Modernization Act; classification reform; human resources planning and accountability; leadership development; official languages; employment equity; and values and ethics.

About the Research Directorate

The Research Directorate is part of the Human Resources Planning, Accountability and Diversity Branch within the PSHRMAC. Its mandate is to conduct research to build Public Service-wide capacity in Human Resources management, planning, and strategy, in support of PSHRMAC, departments, agencies and functional communities. The expertise within the Research Directorate comprises a wide range of knowledge and skills, including: demographic analysis and forecasting, labour market surveying and analysis, environmental scanning, needs analysis, and special thematic studies.

About the Team

The team responsible for environmental scanning and current and future needs analysis (ESCFN) is composed of employees with backgrounds in demography, sociology, psychology, economics and information or actuarial sciences. Under the direction of Bey Benhamadi, Research Manager, team members contributed as follows:

Gilbert Lagrange, Senior Research Analyst (chapters II-1, II-5, II-6, III-1 and global revision)
Nabila Abou Najm, Research Analyst (integration and global revision)
Chris Prince, Research Analyst (chapter II-3, II-6 and global revision)
Rahim Abdur, Research Analyst (chapter II-1)
Jeremy Taylor, Research Analyst (chapter II-4 and III-2)
Haldun Sarlan, Research Analyst (chapter II-2)
Ron Habinski, Senior Research Analyst (who joined the research directorate in April 2005 did an excellent job of critically reading and revising the text)

The following employees of the Research Directorate have also contributed to this project:

Brian McDougall, Senior Research Analyst
Leonard Robichaud, Research Analyst
Vickie Coghlan, Research Analyst
Rolina van Gaalen, Research Analyst
James Kierstead, Research Manager

Executive Summary

The Public Service Modernization Act formalized the need to integrate the identification of current and future human resources needs with the process of human resources planning. An environmental scan was undertaken to assist departments and agencies in identifying their short and long-term human resources needs. The scan focused on recent human-resources-related developments and trends in order to identify the main challenges that human resources management within the Public Service will face in the coming years. This report is a time-bound snapshot that will require periodic updating to reflect new or changing environmental factors.

Population ageing is one of the major trends that will influence the future of human resources in the Public Service. However, while its effect on Canada's workforce will be substantial, its impact is often exaggerated. Two main considerations point in this direction. First, there is still time to respond to this challenge. The full effects of ongoing retirements by baby-boomers will not arrive before 2010, when the oldest among them start turning 65. Of course, the increased popularity of early retirement may accelerate the departure of baby-boomers from the workforce. Secondly, the shortage of workers that will result from disparities between the number of retiring baby-boomers and the number of newcomers to the workforce needs to be qualified. Experts in the field are predicting shortages affecting specific skills as opposed to the labour force as a whole. Nevertheless, as the Public Service is older on average than the Canadian labour force as a whole, it is more vulnerable to the consequences of population ageing. This makes succession planning, knowledge transfer and the identification of potential shortage areas even more critical. The baby-boomer exodus is a chance to renew the Public Service by hiring younger employees. This transition will provide an opportunity to hire candidates who meet the needs of the Public Service with regard to professional qualifications, linguistic capacity and employment equity representation.

The Canadian workforce is changing rapidly. As the demand for highly qualified and highly educated workers grows, the educational level of Canadians is rising and surpassing the average levels of most other countries. The ongoing computerization of the workplace is bringing both challenges and opportunities. Gains such as employee access to computer-based learning and provision of government services through the Internet need to be weighed against growing concerns over confidentiality, privacy and the contribution of computerization to the accelerating pace of work. The importance of learning, education, research and development is increasingly apparent, prompting more government investment in the development of a high-quality workforce. This is positioning Canada to compete effectively with other countries, although factors such as the rising cost of higher education and increased reliance on temporary work may diminish our net advantage. Another concern is the fact that some segments of Canadian society have limited access to current technology, and thus lack the knowledge and skills required to function in a knowledge-based economy. The incidence of this gap seems especially acute among members of some Employment Equity designated groups.

The social composition of the Canadian workforce is also changing. Its increasing diversity mirrors trends visible in the population at large. These include the increasing representation of visible minorities (linked to sustained immigration and high fertility), the proximate entry of a large cohort of Aboriginal peoples into the labour force (linked to higher fertility), and the steadily increasing workforce participation of women. Women remain more likely than men to leave the workforce for extended periods of time to care for family members, and to end up in less secure jobs. Because the risk of acquired disability increases with age, the representation of persons with disabilities in the general population is expected to rise as the baby-boomer generation ages. However, it is unclear how this will affect the workforce representation of persons with disabilities, given their tendency to leave the workforce before the average retirement age of Canadian workers. Knowledge of official languages increased slightly between 1996 and 2001. Nevertheless, a large gap remains between the second language proficiency of those whose first official language is French and those whose first official language is English. Within the Public Service, official languages programs have seen renewal.

The current political context is characterized by a relative mistrust of the Canadian public in its government, the election of a minority government in the 2004 election and the high profile of security concerns both within the country and internationally. The Government has responded to these pressures by: tightening financial management, balancing the budget, conducting an expenditure review, modifying the mechanics of the Public Service through the implementation of the Public Service Modernization Act, considering possible avenues for political reforms, refreshing parliamentary rules and the election process. There have also been links with the United States and other countries, along with renewed conciliation and international collaboration.

As a key element of a healthy and strong human resources management environment, the human resources community is undergoing rapid change. The work performed by human resources professionals is growing in scope, complexity and volume as their traditional operations-centred role expands to include new responsibilities such as: strategic planning, analytical work, support of values and ethics, support of employee learning needs and engagement, etc. Within the Public Service, the increased workload associated with these additional roles was identified by the human resources community as a concern in the Public Service Employee Surveys of 1999 and 2002. While technological innovations can help ease this workload to some extent, they come at a cost in financial terms and in terms of time and resources required to develop, implement and learn new applications. Given that the Public Service human resources community, and the PE group in particular, are especially vulnerable to the coming wave of retirements resulting from the ageing of the Public Service workforce, their retention may become a challenge in the coming years. The development of alternative working arrangements that would provide an attractive alternative to retirement, possibly including some form of phased retirement, could help delay the retirement of key employees both in the human resources community and throughout the Public Service. Alternative working arrangements may also help to attract and retain the young employees required to renew the Public Service workforce, given the different attitudes and expectations that typically distinguish them from older employees.

Introduction

Interest in environmental scanning has grown in recent years, as organizations have come to appreciate the benefits of acquiring a good knowledge of their operating context and of using that knowledge in their planning activities. As a human resources planning tool, environmental scanning supports efforts to get the right people in the right place at the right time. While knowledge of existing issues and trends facilitates the development of targeted and efficient solutions to address today's human resources needs, awareness of potential future issues makes it easier to prepare for tomorrow's human resources needs. Knowledge gathered through environmental scanning also facilitates the integration of human resources and business planning by identifying challenges and opportunities common to both.

Obviously, environmental scanning can benefit the federal Public Service as it would any other organization. However, the Public Service Modernization Act further accentuates the usefulness of such an exercise. There is now a formal requirement to identify current and future human resources needs and account for these needs in human resources planning. In August 2004, a special team was set up in the Research Directorate of the Public Service Human Resources Management Agency of Canada (PSHRMAC) to undertake an environmental scan to identify key trends emerging within and without the federal Public Service that could have short and long-term impacts on human resources needs. By providing an overview of the situation for the Public Service overall, the scan helps departments and agencies identify their main human resources challenges. Indeed, this initiative could be the starting point of a sustained collaboration between PSHRMAC's environmental scanning team, and human resources planners/environmental scanners within departments. It may also serve to raise the profile of human resources issues in the scanning activities already being carried out by departments.

The information included in this environmental scan comes from a variety of sources, both inside and outside the Public Service, including: academic literature, journals, media coverage, think tanks, public opinion research groups, Human Resources Environmental Scanning Advisory Committee, Cabinet, Office of the Prime Minister, Privy Council Office, Policy Research Initiative, interdepartmental working groups, central agencies, Auditor General's Report, Statistics Canada, departmental policy shops, Office of the Chief Actuary of Canada, Canadian Policy Research Network, Conference Board of Canada, financial institutions, and non-governmental organizations.

The broad scope of the scan ensured the capture of trends and issues bearing directly or indirectly on human resources. The external environment was broken down into six areas:

• Demographics;
• Economy and labour market;
• Society and culture;
• Science and technology;
• Physical environment; and,
• Politics and governance.

The situation within the Public Service was also examined, with particular emphasis on:

• The Public Service workforce; and,
• The business and human resources management goals of the Government.

Each of these eight major sections of the environmental scan and current and future needs report include:

• A summary of the section,
• A review of specific issues and trends including:
  • A description of the issues;
  • Their main implications for human resources management;
  • A summary of the trends observed, as well as the current and future human resources needs arising from each issue.
• Cross references to other sections of the report where similar issues appear.

Finally, a series of statistical indicators are available on a CD. The graphs and tables provide basic information on the Public Service workforce as of March 2005, as well as on recent mobility and separations. The data elements include age, gender, department, region, occupational group, etc.

This report is the result of the collaboration and contributions of various stakeholders across the federal government. The expert advice provided by the Human Resources Environmental Scan Advisory Committee has been most valuable. In addition, this committee included representatives of the following central agencies, departments and unions:

• Canada School of Public Service;
• Canadian International Development Agency;
• Environment Canada;
• Fisheries and Oceans Canada;
• Indian and Northern Affairs;
• Industry Canada;
• Privy Council Office;
• Professional Institute of the Public Service of Canada;
• Public Service Commission;
• Public Works and Government Services Canada;
• Social Development Canada;
• Statistics Canada;
• Treasury Board Secretariat.

Representatives of the following sectors of the Public Service Human Resources Management Agency of Canada also brought their expertise and contribution to the exercise: Classification, Communications, Employment Equity, the Leadership Network, Official Languages and Values and Ethics.

I. Scanning the Environment: From a Multidimensional Analysis to the Identification of Current and Future Needs

Environmental scanning relies on the systematic review of a wide range of information sources to identify issues and trends that could affect the capacity of an organization to conduct its business and achieve its goals. This is a significant undertaking - in both magnitude and complexity - as it requires the gathering, analysis, and interpretation of ever-changing information encompassing various fields of expertise.

The results of an environmental scan emerge from a number of strategic decisions made throughout the exercise; in this regard, environmental scanning remains a subjective exercise, no matter the precision of the process. Subjectivity comes into play in the choice of information collected and the issues explored. Reliance on a multidisciplinary scanning team and a consultative committee may help the process and results but does not guarantee objectivity.

The information elements included in this study were limited to those thought to have a potential impact on human resources management in the federal Public Service. Issues and trends that were considered to fall outside this scope were not pursued. Issues examined have tended to overlap in multiple environmental areas. For instance, while population ageing is fundamentally a demographic phenomenon, it has implications for the economy, politics, culture, the physical environment, etc. Reflecting the ramifications of such multidimensional issues necessarily involves some repetition.

Although this study focuses on Public-Service-wide human resources management, the impact of trends and issues on human resources management in specific departments appear in a few instances.

Current and future human resources management needs are extrapolations from the findings of the environmental scan. The needs identified do not constitute recommendations or solutions to issues, but rather factors to be considered when developing human resources plans.

II. Scan of the External Environment

1. Population

Canada, like other industrialized countries, is experiencing significant demographic changes as several converging factors gradually produce an older, more urbanized and increasingly diverse population. This will have economic and social impacts upon the size and composition of the labour market, demand for health care, education, transportation, housing, etc.

Population Ageing

As a result of low fertility and improvements to life expectancy over past decades, Canada's population has gradually been aging. It is estimated that by 2011, half of the Canadian population will be 41 years old or older. This is more than 3 years older than the median age of 37.6 years observed in 2001. This change results from both an increase in the proportion of the population aged 65 and a decrease in the proportion of young Canadians. Between 2001 and 2011, the proportion of Canadians aged 65 and over is expected to grow from 13% to 15%. The growth rate of this segment of the population will accelerate after 2011- as baby-boomers start turning 65.

As the overall population ages, so does the workforce. Among those aged 20 to 64, the median age is expected to increase by more than two years, from 41.3 in 2001 to about 43.7 years in 2011. The proportion of the population aged 45 to 64 is also expected to increase from about one-quarter in 2001 to almost one-third by 2011. Given that labour force participation rates tend to decline with age, population ageing is expected to have an adverse impact on the growth of the Canadian workforce. The workforce growth rate is expected to drop from the 1.6% average observed in recent years, to less than 1% in the coming decades. Other factors such as financial situation, income levels and social policies also affect labour force participation rates and may provide ways to alleviate the impact of ageing. Many experts argue that while a system-wide labour shortage is unlikely, short-term skill shortages may affect specialized occupations in the private and public sectors.

Implications

• Population ageing increases economic and social costs (public pension costs, demand for health and social services, etc.) while at the same time decreasing the number of workers bearing these costs.
• Both the private sector and the public service face retirement waves among their most experienced and knowledgeable employees over the next two decades. This will put more pressure on human resources management to ensure a timely renewal of the workforce.
• An imbalance between retirements and new hires may cause skill shortages in certain occupational groups.

Current and Future Needs

Issue: Population Ageing

Trends

• Canada's population is ageing, as low fertility and improved life expectancy trends continue.
• Between 1996 and 2001, the median age of Canadians increased by more than 2 years, from 35.3 to 37.6 years. It is expected to reach 41 years by 2011.
• Growth of the 65+ segment of the population will accelerate around 2010 as baby-boomers begin turning 65.
• The Canadian workforce will also be affected by population ageing. The size of the population aged 45 to 64, which increased from 5.4 million to almost 7.3 million between 1991 and 2001, is expected to increase to 9.5 million by 2011.
• Conversely, the number of Canadians between the ages of 25 and 34 declined by 18% between 1991 and 2001, as the tail of the baby-boom generations was gradually replaced by the smaller baby-bust generation.

Current Needs

• Implement or reinforce adaptive measures such as flexible working arrangements or flexible retirement options to help accommodate and retain older workers, allowing more time for knowledge transfer and enabling organizations to benefit longer from the contribution of more experienced employees.
• Reinforce human resources planning and workforce analysis (demographics, turnover statistics, etc.).
• Encourage higher rates of labour force participation through proper policies and programs (job search assistance, skills development, child care support, etc.).

Future Needs

• Changes to the demand for economic, health, and social services, may affect the workload in certain parts of the Public Service, possibly requiring an adjustment with regard to the size and composition of the workforce.
• The identification of potential skill shortages that could eventually affect the Public Service would reinforce the human resources planning exercise.
• Monitoring of workforce renewal would allow timely adjustments to human resources plans.

The Situation of Women

Women continue to be disadvantaged in economic terms, though the gender gap in earnings has narrowed. A majority of women are still employed in more traditional occupations (teaching, nursing, etc.), although gains have been achieved with regard to higher labour force participation in general, and accessing non-traditional occupations in particular.

The Federal Plan for Gender Equality, adopted in the wake of the United Nations World Conference on women in Beijing in 1995, sets eight objectives for the government. These include: the implementation of gender-based analysis throughout federal departments and agencies; the improvement of women's economic autonomy and well-being; the improvement of women's physical and psychological well-being; the reduction of violence in society, particularly against women and children; the promotion of gender equality in all aspects of Canada's cultural life; the incorporation of women's perspectives in governance; the promotion and support of global gender equality; and the advancement of gender equality for employees of federal departments and agencies.

Lone-parent families tend to be less well off and the growing incidence of this family type has contributed to women's impoverishment. In turn, poverty and added family obligations influence their career progression and retirement patterns.

Implications

• The growing labour force participation of women translates into higher workforce availability for employment equity purposes.
• The Agenda for Gender Equality fosters the creation of partnerships between Status of Women Canada, government departments, and other stakeholders on initiatives targeted to address gender inequality issues. The implementation of multi-level partnerships under the Agenda would affect workload in all participating organizations.
• Because of discrepancies in the amount of time spent by spouses on tasks at home, as well as discrepancies in the time spent on caring for children and elderly dependants, balancing work-life obligations often has a very different meaning for male and female workers.
• The trend towards lone-parent families fosters economic disparity between families, affecting women more severely than men, both in terms of career progression and retirement plans.
• The growth of lone-parent families and dual-earner families complicates the achievement of work-life balance for employees in these situations, and increases the pressure on human resources management to find ways to accommodate these needs.

Current and Future Needs

Issue: The Situation of Women

Trends

• In 2003, 57% of all women aged 15 and over had jobs up from 42% in 1976. In contrast, 68% of men were employed in 2003, down from 73% in 1976.
• A higher proportion of employed women work part-time. In 2003, 28% of all women in the workforce worked less than 30 hours per week, compared to 11% of men.
• Although women have widened their range of occupations, they remain concentrated in occupations traditionally held by women. In 2003, 70% of all employed women were working in teaching, nursing and related health occupations, clerical or other administrative positions, or sales and service occupations. Only 31% of all employed men were in similar occupations.
• Unemployment is lower among women than men. In 2003, 7.2% of female labour force participants were unemployed, compared with 8.0% of male participants. Women who are immigrants, members of visible minorities, Aboriginals, and women with disabilities have higher unemployment rates than other women.
• Women spend more time than men doing household work, including child-care and eldercare, and thus are more likely to require flexible working arrangements.
• In 2001, women headed 81% of lone-parent families. Single mothers and senior women living alone are most likely to experience financial stress and even poverty.

Future Needs

• An increase in the representation of women in the broader Canadian workforce would need to be reflected in the Public Service workforce.
• Current trends affecting family structure make it more difficult for employees to achieve work life balance and could increase demand for flexible working arrangements.

An Increasingly Diverse Society

Historically, immigration has made a significant contribution to the growth and composition of both the Canadian population and its labour force. In recent years, immigration has become the main source of population growth in Canada. In fact, during the last decade, almost 60% of population growth was due to net migration, and this proportion is expected to reach 75% by 2016. By 2025, the annual number of births may no longer suffice to offset the number of deaths. Immigration would serve as the only source of population growth. Nevertheless, immigration will not suffice to make up for the consequences of the ageing phenomenon. Even at its current level of about 235,000 immigrants a year, which is one of the highest rates of intake among countries of the Organisation for Economic Co-operation and Development, immigration would only attenuate the impact of ageing.

Components of Growth of the Canadian Population Between 1972 and 2004

Source: Public Service Human Resources Management Agency of Canada, Research Directorate

Recent immigrants are young, educated, and skilled, reflecting the fact that more than half of those admitted in the last decade were economic immigrants selected on the basis of labour market needs. Yet labour market indicators (labour force participation, employment opportunities, income, etc.) for immigrants who landed in Canada in the early 1990s are bleaker than those of either previous cohorts of immigrants or Canadian-born individuals. Finding employment in their field of expertise proves difficult for an overwhelming majority of immigrants. Lack of Canadian experience and difficulties in having foreign credentials recognized create stumbling blocks for integrating immigrants into the labour force.

A large proportion of immigrants to Canada settle in the three largest cities of Toronto, Vancouver, and Montreal, where they now comprise 10% of the population. Almost 40% of all immigrants to Canada last year were destined for the Greater Toronto Area. In contrast, only 2.6% settled in the National Capital Region. According to Statistics Canada analysis of 2001 Census data, immigrants settling in the National Capital Region were the highest educated of all Canadian urban areas, with 50.9% having university degrees. However, this same group had an unemployment rate (10.9%) three times that of other Canadians in the region.

The Canadian population is comprised of individuals of more than 200 different ethnic origins. In the past, a majority of immigrants were from European countries, but most now come from countries in South and Southeast Asia, the Middle East, the Caribbean, South and Central America, and Africa. For two years in a row, more than 62% of all recent immigrants were born in Asia. The top four source countries in 2003 were China, India, The Philippines and Pakistan. As a result, members of visible minorities now account for more than 13% of the total Canadian population, and they are growing faster than the total population.

Implications

• Proper integration of new immigrants into Canadian society and the labour market requires programs and services such as language training, labour market and employment training, accreditation of foreign academic and professional credentials, etc.
• As most immigrants are of working age and their selection is influenced by labour market needs, they can contribute immediately to the workforce, relieving some skill shortages.
• Population diversification brings increased representation of visible minorities in the population and workforce.
• Future changes in immigration sources and levels could have an impact on the workload of departments and agencies involved with issues of domestic and international security.

Current and Future Needs

Issue: An Increasingly Diverse Society

Trends

• Immigration is the major source of Canada's population growth. Over the next decade, net labour force growth will rely on immigration.
• In 2003, Canada welcomed 221,352 immigrants and refugees as new permanent residents, somewhat less than in 2002 (229,091).
• The majority of recent immigrants are of working age, have university education, and know at least one official language. The immigration of educated and skilled workers helps sustain labour force growth and reduce the impact of potential skill shortages.
• The majority of recent immigrants settled in Toronto, Vancouver, Montreal, and Calgary, contributing to faster growth in these cities when compared to the rest of the country.
• In recent years, economic immigrants comprised two-thirds of new immigrants; family-class immigrants represent about 27%, and the refugee class only 6%.
• The majority of recent immigrants have come from Asia, Africa, Latin America, and the Caribbean, increasing Canada's diversity and number of visible minorities.

Future Needs

• Facilitating the integration of immigrants into the labour market (e.g. language training, recognition of foreign credentials, Canadian citizenship, etc.) would make it easier for the Public Service to benefit from their skills.
• Increases in the representation of visible minorities in the broader Canadian workforce need to be reflected in the Public Service workforce.
• Future changes in immigration sources and levels could have an impact on the workload of departments and agencies involved with issues of domestic and international security.
• Diversification of the Canadian population could require adjustments to the way in which programs and services are delivered (e.g. provision of documentation in multiple languages).

A Burgeoning Population of Aboriginal Peoples

More than one million Aboriginal peoples from diverse cultures and different linguistic groups live throughout Canada. As they have higher fertility rates than non-Aboriginals, their number is growing twice as fast the rest of the population. The Aboriginal population is also much younger than the Canadian population. From 1991 to 2016, the Aboriginal population is expected to grow by 52% compared to 22% for Canada's non-Aboriginal population.

Aboriginal peoples tend to experience much bleaker living conditions than non-Aboriginals. Despite some progress, many communities still face serious economic and social issues (high levels of poverty and unemployment, inadequate housing, poor access to health and education services, etc.).

The Royal Commission on Aboriginal peoples, launched in 1991, concluded that the relationship between Aboriginals and non-Aboriginals had to be recast around the establishment of government-to-government relationships between Canada and Aboriginal nations, thus promoting the rebuilding of Aboriginal nationhood, support to Aboriginal governments, and the improvement of living conditions.

In response to the Commission's report, in 1998 the federal government adopted a broad-based policy approach designed to increase the quality of life of Aboriginal peoples and promote self-sufficiency, including settlement of land disputes, promotion of self-government arrangements, as well as the improvement of health-care, education and employment services.

More recently, the Government has renewed its commitment to improving the situation of Aboriginal peoples through announcements made in the Speech from the Throne and the appointment of a parliamentary secretary to deal specifically with Aboriginal concerns.

Implications

The implementation of self-governance would have an impact on the role, relevance and workload of the department of Indian and Northern Affairs.

The younger age structure of Aboriginal peoples, relative to the Canadian population, should result in an increased representation in the labour force over the coming years, as the entry of young Aboriginals into the workforce coincides with the exit of non-Aboriginal baby-boomers. Obviously, other factors affecting labour force participation, such as education and skills development, could increase or limit the labour force entry of young Aboriginal peoples.

Current and Future Needs

Issue: A Burgeoning Population of Aboriginal Peoples

Trends

• While the Aboriginal population represents 3.3% of Canada's population, Aboriginal children represent 5.6% of Canada's children.
• There are 630 First Nations, comprising 52 Nations or cultural groups, and more than 50 languages.
• Aboriginal languages are being lost as mother tongues. Only 24% of Aboriginal people can speak an Aboriginal language, down from 29% in 1996.
• The Aboriginal population is younger and growing almost twice the rate of the Canadian population. These young Aboriginals represent an important potential source of workers.
• The unemployment rate among the Aboriginal population is twice the Canadian average.
• More Aboriginal people live in the urban areas of Canada than on reserves. Significant proportions live in large cities in western Canada.

Future Needs

• An increase in the representation of Aboriginal peoples in the broader Canadian workforce would need to be reflected in the Public Service workforce.
• Attract young Aboriginal workers through specialized recruitment and retention.

Persons with Disabilities

Data from the 2001 Participation and Activity Limitation Survey indicated that about 3.6 million Canadians, or 12.4% of the population, described themselves as affected by activity limitations resulting from some form of disability. The disability rate increases substantially with age. While very few of those under 25 years of age self-identified as persons with a disability, the rate increases rapidly after age 45, culminating in a rate of more than 50% among those aged 75 and over. Overall, women have a somewhat higher rate of disability (13.3%) than men (11.5%), presumably due to a higher representation of women in the older population.

Among those affected by a disability, more than one in four (26.9%) experienced severe disabilities and 14% had very severe disabilities. Women (28.5%) and men (25.1%) experienced similar rates of very severe disabilities.

Disability Rate By Age Group, 2001

Source: Participation and Activity Limitation Survey, 2001, Statistics Canada, http://www.statcan.ca/Daily/English/021203/d021203a.htm

The 2001 data also showed that among those between 15 and 64, less than half of the Persons with Disabilities were employed, compared to nearly 70% of the rest of the population. Moreover, 85% of Persons with Disabilities found in the workforce had some limitation at work, although fewer than 20% required any form of accommodation. Not surprisingly, Persons with Disabilities of working age have lower incomes than the rest of the population.

The Health Care in Canada survey found that in 2001, about 771,000 Persons with Disabilities in Canada needed help with everyday activities, but could not find it. Cost, unavailability of resources, and lack of insurance were the most common reasons cited.

Implications

• The proportion of persons with disabilities is likely to increase as a result of population ageing; however, this may not necessarily translate into an equivalent increase in the representation of persons with disabilities in the workforce.
• As baby-boomers grow older, an increasing proportion of the workforce will reach ages where disability is more prevalent.

Current and Future Needs

Issue: Persons with Disabilities

Trends

• In 2001, the overall proportion of person with disabilities in Canada was 12.4%. However, this proportion increases substantially with age.
• The disability rate is higher among women (13.3%) than men (11.5%).
• One in four Persons with Disabilities (26.9%) experienced severe disabilities, and 14% had very severe disabilities. Severe disabilities were somewhat more common among women (28.5%) than men (25.1%), but there were no gender differences with regard to very severe disabilities.
• Less than half of persons with disabilities aged 15-65 were employed, compared to nearly 70% of people without disabilities.
• While 85% of persons with disabilities in the workforce have some limitation at work, fewer than 20% require any form of accommodation.
• Persons with disabilities are more likely to have lower incomes.
• In 2001, about 771,000 persons with disabilities in Canada needed help with everyday activities but could not find it. Cost, unavailability of resources, and lack of insurance were the top three reasons.

Future Needs

• Ageing of the Public Service workforce could result in an increase in acquired disabilities among employees, thus potentially raising demand for accommodations and flexibility in delivering work.
• An increase in the representation of persons with disabilities in the broader Canadian workforce would need to be reflected by an increase in the Public Service workforce.

Linguistic Composition

In 2001 Canadians whose mother tongue was English represented 59.1% of the total population (2.6% more than in 1996). French is the second most common mother tongue, shared by 22.9% of the population (1.1% higher than in 1996). Chinese ranks third with 2.9% of the total population, followed by Italian, German, Punjabi and Spanish. English and French remain the official languages of public affairs. About one-quarter of Aboriginal peoples speak an Aboriginal language. The most commonly spoken Aboriginal languages are Cree, Inuktitut, and Ojibway.

About 74% of Canadians declared English as their first official language while 24% declared French. Overall, official bilingualism remained relatively stable between 1996 and 2001, increasing slightly from 17.0% to 17.7%. Bilingualism remains significantly higher among French-speakers (43.4%) than among English-speakers (9%), in fact, 58% of bilingual Canadians declare French as their first official language. Accordingly, more than half of all bilingual Canadians live in Quebec and an additional 25% live in Ontario. More than 90% of Aboriginal peoples and visible minorities claim English as their first official language, a reflection of their higher concentration in English-speaking provinces. Overall, Aboriginal peoples, persons with disabilities and visible minorities show levels of official bilingualism that are below the Canadian average. Younger Canadians are more often bilingual than older people. Canadians between the ages of 15 and 39 account for 35% of the overall population, and 45% of the bilingual population.

Sustained immigration is changing Canada's linguistic diversity, particularly the influx of immigrants who have a mother tongue other than English or French. In 2003, 44% of immigrants knew neither English nor French, and between 1996 and 2001, the proportion of the population reporting a mother tongue other than English or French increased from 12.5% to 18%.

Implications

The learning of Official Languages is an important component of the integration of immigrants who have a different mother tongue.

Multilingualism gives an advantage to Canadian private and public sectors in dealing with individuals and businesses from abroad.

Current and Future Needs

Issue: Linguistic Composition

Trends

• Based on mother tongue, English-speaking Canadians represent the majority of the population (59.1%), followed by French (22.9%), Chinese (2.9%), and Italian, German, Punjabi and Spanish.
• Aboriginal languages are spoken by about one in four Aboriginal People. Among Aboriginal languages, Cree, Inuktitut, and Ojibway are the most commonly used.
• Official bilingualism increased from 17.0% in 1996 to 17.7% in 2001. It ranges from 9% for English speakers to 43.4% among French speakers, and is less prevalent among most employment equity designated groups. Among the overall Canadian population, 58% of people who speak both official languages have French as their first official language.
• Canada is increasingly becoming a multilingual society, although English and French remain the official languages of public affairs.

Future Needs

• New and innovative partnerships will be required between governments at all levels, and among and between organizations, to harness the full potential of cultural and linguistic diversity.
• In addition to the statutory requirement to provide government services in English and French, demand may rise to provide them in non-official languages.

2. Economy and Labour Market

Canada is experiencing a time of remarkable economic change. Markets are becoming increasingly integrated with the world economy; innovative developments in computer and communications technology are greatly altering the workplace and lifestyles. The Canadian economy has performed well over the past year: Gross Domestic Product growth is on the upswing; demand is strong; and the unemployment rate is approaching a five-year low. However, the Canadian economy is expected to face important challenges in the years to come, and gains in productivity are required to deal with looming aging-related issues, such as sustainable health care policies.

In response to changes in its economic environment, Canada has undertaken wide-ranging reforms. The regulatory environment and the incentives available to individuals and firms have been substantially modified, through measures such as tax reform, the North American Free Trade Agreement, reduction and simplification of tariffs, removal of barriers to internal trade, privatizing of public enterprises, modernizing of the public sector, and revamping of labour market programmes to promote job attachment.

Consistent with its overall economic performance, Canada's labour market was strong in 2004, and improvements were registered in terms of labour force participation and employment. Demand for skilled labour was on the rise, and the market responded by providing workers that were better educated and more apt to fill skill-based positions. While the issue of ageing could be of concern over the next few decades, the market seems to have the ability to cope with potential supply shortages. Nevertheless, the situation is not perfect. Structural unemployment, weak labour-management relations, concerns about job safety, and job-related stress are relatively fragile aspects of the labour market.

The Canadian economy is in relatively good shape, and is expected to grow by 2.7% in 2004 and by 3.3% in 2005. Domestic demand is strong thanks to low interest rates, rising disposable incomes, and high business investment. In addition, consumer confidence has reached a historically high level. Moreover, growth in the United States has boosted demand for Canadian products. Domestic demand is expected to drive economic growth to the end of 2005.

Thus far in 2004, 110,800 new jobs have been created, mostly full-time jobs, and employment grew by 2.0% in the second quarter. However, employment growth is expected to slow somewhat in 2004 and 2005 to a level below the 2.2% rate experienced in 2002 and 2003. Currently, the unemployment rate is relatively stable at 7.3%, but it is forecasted to decline slightly to 7.2% in 2005.

The world economy continues to gain strength, and forecasts of economic growth have generally been marked by optimism, showing a growth in the world economy of about 4.5% for both 2004 and 2005. To put things in perspective, this would represent the strongest two-year growth performance since the late 1970s.

The ebbs and flows of confidence in the American economy have greatly affected perceptions about the worldwide economic cycle. The American administration has emphasized strong economic growth as a top priority, but achieving this outcome will be a challenge. Although the economy of the United States has been quite resilient, its increasing deficit (as well as similar imbalances elsewhere in the world) poses long-term risks. As measures are implemented to resolve these imbalances, their long-term impact on the global financial system will depend on its flexibility and the soundness of the macroeconomic policies being implemented.

Fiscal Policies of the Government

The Government maintains its firm commitment to balanced budgets, disciplined spending, paying off the debt and reducing taxes. The 2004 budget is characterized by prudence, and commitment to improving expenditure control and efficiency in the management of public funds at a time when new investments are being made in public health, learning, knowledge and commercialization, communities, and Canada's relations with the rest of the world. In particular, the implementation of an expenditure review process is intended to facilitate reallocation of funds from programs with a lower priority to those that are the current priorities of the Government.

Program spending is set to grow by 3.1% in the 2004/05 fiscal year, and by 5.6% in the following fiscal year. Although the bulk of this increase is attributable to health care expenditures, spending initiatives totalling $1.5 billion were also announced in other domains: defence, environment, equalization financing and building research foundations. In spite of these increases, program spending was not expected to change much relative to the forecasted size of the economy.

In fiscal year 2003/04, government revenues were better than expected, rising by 2.0%. Revenues are expected to grow 3.4% in 2004/05 and 4.6% in 2005/06. However, relative to the size of the economy, revenues are actually being scaled back. They are poised to come in at just 14.7% of the Gross Domestic Product in 2005/06, and this would be their lowest level since the early 1960s.

If the Government's fiscal assumptions prove accurate, balanced budgets in 2004/05 and 2005/06 will leave $3 billion in unused contingency reserves to go toward debt repayment, and $1 billion in unused economic prudence. The Government has set a goal of cutting the ratio of the federal debt to the Gross Domestic Product to 25%, from its current 42%, within 10 years. This would reduce the country's debt-to-GDP ratio to levels not seen since the mid-1970s.

Having introduced a sound fiscal framework and reformed its public pension system, Canada is better positioned than most other countries to face ageing-related fiscal challenges, but longer term increases in health-care costs remain a risk.

Implications

• Current fiscal policies tend to constrain the budgets allocated to departments and agencies.
• Fiscal pressures, resulting from changing economic conditions, or from program or expenditure reviews, may result in funding cuts to government programs.

Current and Future Needs

Issue: Fiscal Policies of the Government

Trends

• Current fiscal policy is characterized by prudence, and aims at balancing the budget, reducing debt, and reallocating funds to priority programs, while allowing for some new investments, primarily in health care.
• Although program spending is set to grow in both 2004-05 and 2005-06, a forecasted rise in budgetary revenues, coupled with control of expenditures, should yield balanced budgets and leave $3 billion in unused contingency reserves to go toward debt repayment and $1 billion in unused economic prudence.
• The Government's goal is to cut the ratio of federal debt to Gross Domestic Product to 25% from its current 42% within 10 years, bringing it down to levels not seen since the mid-1970s.
• Canada is better positioned than most countries to face ageing-related fiscal challenges, but rising health-care costs remain a risk in the longer term.

Future Needs

• Mechanisms need to be implemented to improve resource planning and allocation in accordance with government priorities.

Innovation and Productivity

Canada trails the United States in economic measures of standard of living and capacity to grow and prosper. For example, despite gains made since 1997, per capita income is still about 20% lower in Canada. Closing this gap will require productivity improvements. To this end, the Government has focussed on innovation, skills, and our capacity to compete globally.

Innovation is the process by which new economic and social benefits are extracted from knowledge. Finding better or faster ways of working, or creating new products or services, are examples of innovation. By applying new knowledge, innovation has become the key competitive advantage in all sectors of economic activity. Although Canadian expenditures on research and development have risen to 1.8% of the gross domestic product, Canadian firms trail behind international competition in their ability to capture the economic benefits of their innovations.

Implications

• Demand for increased productivity could promote better skills development and increase competition for skills across the labour market.
• To respond to the demands of today's knowledge-based economy, Canada must increase productivity by improving on innovation, competitiveness, learning and skills development.
• The implementation of innovations may give rise to a sense of insecurity among some employees, and requires adaptability and openness.

Current and Future Needs

Issue: Innovation and Productivity

Trends

• Canada's real per capita income is about 20% lower than that of the United States. The situation is better than in 1997, but to close the gap labour productivity must be improved.
• Immigration provides Canada with an important source of human capital.
• Innovation, through new knowledge, has become the main source of competitive advantage in all sectors of economic activity.
• Expenditure on research and development has reached 1.8% of gross domestic product.

Future Needs

• Ensure that the Public Service is able to adapt to economic changes and foster innovation.

A Changing Labour Market

The labour force participation rate is a basic indicator of the size of the labour market. It corresponds to the percentage of the overall population aged 15 years and over that is part of the employed and unemployed (but looking) labour force. Participation rates differ considerably by age, gender and region, and are influenced by a wide range of factors, from employment conditions to changes in personal wealth and demographics.

After peaking at 67.5% in 1989, the labour force participation rate fell continually until 1997, at which point it stood at 64.8%. A reversal of this trend, due mainly to increased participation by those aged 55 and older, brought the participation rate back up to 67.5% in 2004.

Immigrant workers account for 70% of recent labour force growth, and by 2011, they may be the sole contributors to this growth. As the majority of recent immigration has been from China, Jamaica, Pakistan, and Vietnam, workforce availability of visible minorities continues to increase. Recognizing the importance of immigration to the Canadian labour force and economy, the 2003 federal budget allocated $41.4 million to attract skilled workers and students, and in 2004, $15 million allotted for advanced language training to aid in the integration of new Canadians into the labour market.

The economic integration of new Canadians has not been seamless, particularly during times of economic slowdown. When fewer jobs are created, recent immigrants are most likely to suffer long periods of unemployment or underemployment. From 1981 to 2000, the average employment earnings of new Canadians in the skilled worker category eroded dramatically, from $37,400 to $28,500. Cohorts of new immigrants who arrived in the early 1990s, a period of recession and high unemployment throughout Canada, had particular difficulty. Furthermore, many immigrants are kept from employment in their fields of expertise - lack of Canadian experience and foreign credentials being the most common reasons given by employers.

In October 2003, Citizenship and Immigration Canada lowered the point requirement for skilled workers applying for permanent residency in Canada. This change enabled many new potential immigrants to apply for the first time. Most members of the Organization for Economic Co-operation and Development have adopted similar reforms to attract skilled immigrants and replace aging citizens who are leaving the workforce. Heightened competition is likely in the future for the best candidates from abroad.

Women constitute the second most important contributor to labour force growth, after immigration. The 2001 census showed that women accounted for as much as 60% of growth in the labour market in Ontario and British Columbia, although women are more likely than men to leave the workforce for extended periods to care for family members, whether children or elderly relatives.

The labour market participation rate of Aboriginal peoples increased from 84% in 1991 to 88% in 1996, and 92% in 2001. Between 1996 and 2001, 122,390 working-age Aboriginal persons entered the labour market. Owing to a younger age structure, the rapid inflow of young Aboriginal persons into the workforce will continue. By 2006, the Aboriginal working age population (aged 15 to 54) could grow by up to 67% and significantly affect the character of the workforce, particularly in certain regions. For example, within the next 10 years, Aboriginal peoples will likely comprise 30% of Saskatchewan's workforce.

An ageing population should reduce the national labour-force participation rate. In fact, Canada is rapidly approaching a bottleneck in its workforce, triggered by the convergence of two demographic trends: the ageing of the baby boomers in the population, and the small size of the generation that is about to enter the workforce. By 2011, approximately 41% of the working population will be between the ages of 45 and 64, compared to 29% in 1991.

To compound the problem, early retirement is becoming increasingly common. The proportion of people retiring before reaching 60 jumped from 29% in 1990 to 43% in 2000. In the last 25 years, the participation rate of men aged 65 to 69 decreased from 24.4% to 16.1%. It is interesting to note that the participation rate of women in the same age group remained stable, but at the much lower level of 7.8%. For those who remain in the labour force, growing older often leads to a realignment of personal priorities, with less emphasis being placed on work and more on personal considerations such as family and health. A recent Statistics Canada study found that between 2002 and 2003 the median retirement age rose from 61 to 62, returning to levels observed in the early 1990's.

Some sectors of the economy are more vulnerable to these trends and likely to feel an impact sooner. Compared to many private sector workforces, the Public Service is highly vulnerable due to its older profile. More lenient retirement-eligibility criteria, the existence of stricter policies on phasing out retirees or restricting their rehiring after retirement, and the preponderance of long-service employees who are entitled to comfortable pension benefits further complicate the Public Service situation. Early retirement is more common in the public sector, where the average retirement age is about 58.5 years, while the private sector average is 61.3 years.

Despite dire predictions, there is no evidence that Canada faces a general shortage of skilled workers as a result of population ageing. Several palliative measures are already policy or are being considered. These include immigration policies targeting skills in short supply; the encouragement of higher rates of labour market participation by under-represented groups such as Aboriginal peoples and single mothers; removing barriers to training and workforce participation; promoting phased retirement and workplace flexibility to prolong participation of older workers; promoting life-long learning and active ageing, including training throughout working life, and promotion and advancement for older workers; and encouraging employers to recruit an age-balanced workforce.

At the other end of the age spectrum, youth participation has increased from less than 50% in 1996 to just below 55% in 2004, and the gap between male and female participation rates has narrowed. However, young workers tend to have a different view of work than employees from other generations. They have less patience for "climbing the corporate ladder", have higher salary expectations than their older counterparts, and are more inclined to look for better benefits and pension plans when comparing potential employers. Owing to corporate downsizing, recent graduates entering the workforce may not expect to stay in one organization for the long term even if they are offered mentoring opportunities and on-the-job training.

Independent contractors and small businesses have formed outsourcing partnerships within the private and public sectors. Between 1976 and 2002, the number of self-employed workers in Canada doubled. In August 2004, 15.4% of all Canadian workers were self-employed. About one-third of these were professional, scientific or technical workers. The self-employed workforce was almost as large as all levels of the public sector. Self-employment is more prevalent among men, and tends to increase with age, with those aged 55 to 64 years old being about 2.5 times more likely to be self-employed than those aged 25 to 44.

Temporary employment represents an important feature of today's employment landscape, accounting for one-fourth of the new jobs created between 1997 and 2000. As temporary jobs typically pay less than permanent jobs and offer less access to training and benefits (paid vacation, sick leave, etc.), lower employee job satisfaction results. Women, young workers and less-educated workers are over-represented among temporary workers. In fact, young workers are about three times more likely than older ones to find themselves in temporary job.

Implications

• As women's participation in the workforce continues to grow, childcare and eldercare issues will become increasingly important. Issues related to work-life balance are also likely to gain importance due to workforce ageing.
• The existence of stereotypes and biases can create employment and mobility barriers for both older and younger employees.
• The emergence of skill shortages may be signalled by employment growth, an unusually low unemployment rate or rapidly rising wages.
• Gains in the popular appeal of self-employment may compel corporations and the Public Service to adjust human resources practices.
• Responsiveness to the expectations and attitudes of younger workers will affect the capacity of the Public Service to renew itself.
• To the extent that it affects job satisfaction and the image of the Public Service as an employer, short-term employment may impact on the ability of the Public Service to compete for new talented employees.

Current and Future Needs

Issue: A Changing Labour Market

Trends

• Labour force participation rates declined from 67.5% in 1989 to 64.8% in 1997, and then increased back to 67.5% in 2004, due to an increase in participation of workers 55 and over.
• About 70% of recent growth in the workforce is due to immigration. By 2011, all workforce growth will depend on immigration, leading to an increase in the workforce availability of visible minorities.
• Women constitute the second most important contributor to workforce growth.
• Women are more likely than men to leave the workforce for extended periods of time to care for family members.
• The workforce participation rates of Aboriginal peoples increased from 84% in 1991 to 92% in 2001. Due to the younger age structure of Aboriginal peoples, the rapid inflow of young Aboriginal persons into the workforce will continue.
• The ageing of baby boomers, and the lack of a sufficient number of young people to replace them in the workforce, will adversely affect the participation rate.
• The Public Service is more vulnerable to the impact of population ageing because its workforce tends to be older, the criteria determining retirement eligibility are more lenient, and internal policies make it more difficult to take phased retirement or hire back retirees.
• Early retirement is becoming more common. The proportion of people retiring before reaching 60 years of age jumped from 29% in 1990 to 43% in 2000. Early retirement is more common in the public sector (58.5 years) than in the private sector (61.3 years).
• Youth participation increased from less than 50% in 1996 to just below 55% in 2004.
• Young workers tend to have less patience for "climbing the corporate ladder", have higher salary expectations, are more inclined to look for better benefits and pension plans when comparing potential employers, and do not expect to stay in their current job in the long term.
• Between 1976 and 2002, the number of self-employed workers in Canada doubled. About one-third were professional, scientific or technical workers.
• Temporary employment represents an important feature of today's employment landscape.

CURRENT NEEDS

• Human resources planning with an emphasis on the retention of older employees, and the hiring and retention of younger replacements.

Future Needs

• The Public Service needs to be able to compete with other employers for new talented employees.

Convergence of Skills and Competencies Toward a Knowledge-Based Economy

The Canadian labour market is continuing to move toward a knowledge-based economy. This transformation has been widespread and continuous rather than limited to the high-technology sector. Based on the 2001 Census, Statistics Canada confirmed that competition for highly skilled workers in a diverse labour market will continue.

Since 1981, the largest employment increases have occurred in professional occupations. In 1981, they accounted for almost 9.9% of Canada's workforce; two decades later, they represented more than 14.3%. Management occupations have also experienced a significant increase as their share of the workforce grew from 3.6% to 6.1% over the same 20-year period. Technical occupations have remained at about 4.4%.

Share of Employed Labour Force in Selected Occupations, 1981, 1991 and 2001

Statistics Canada (October 2003). "Knowledge Workers in Canada's Economy, 1971-2001", http://www.statcan.ca:8096/bsolc/english/bsolc?catno=11-624-MIE2003004

Although Ontario and Quebec have experienced the biggest percentage point increases, growth in knowledge-based occupations has occurred in all regions. Across industries, there were large differences in the percentage of workers in knowledge-based occupations. In 2001, some of the largest concentrations of knowledge workers were in business services (66%), and finance and insurance (42%). In the business sector, the proportion of men (19%) working in knowledge-based occupations was higher than that of women (11%), but women have been closing the gap through faster growth.

The proportion of workers in knowledge-based occupations who had completed a university degree was more than 9 percentage points higher in 2001 (51.6%) than in 1981 (42.4%). The proportion of university graduates in other occupations remained below 10% although it exhibited a marked increase between 1981 (4.5%) and 2001 (9.1%). University degrees are most common in professional occupations (65.5% in 2001, up from 59.3% in 1981).

Within the next few years, it is projected that seven in ten new jobs will require some form of post-secondary education or training. Between 1991 and 2001, the proportion of the population aged 15 and over with university credentials grew from 15% to 20%; it grew from 12% to 16% for those holding a college diploma; and the proportion with a trade certificate remained relatively stable at about 12%. Education levels are even higher among younger Canadians. According to the 2001 census, 28% of individuals aged 25 to 34 had university qualifications, 21% held a college diploma, and 12% had trade credentials. In all, 61% of individuals in this age group had qualifications beyond high school compared to 49% ten years earlier. Education levels rose for both men and women.

Population Aged 15 and Older, by Highest Level of Educational Attainment, 1981, 1991 and 2001

Statistics Canada (March 2003). "Education in Canada: Raising the Standard". http://www12.statcan.ca/english/census01/Products/Analytic/companion/educ/contents.cfm

In 2001, 1.1 million people in the working-age population 25 to 64 years of age had doctorates, master's degrees and other qualifications above the bachelor level, such as degrees in law, medicine, dentistry and veterinary science. This represented a 50% increase from the 750,000 enumerated in 1991. On the international scene, Canada is well positioned as it has the fourth highest proportion of university graduates in the developed world and ranks first when college credentials are included.

In terms of field of study, changes during the decade reflect a shift toward technology and business fields. Of the 1.2 million people who graduated from university between 1991 and 2001, about 12% studied in the field of business and commerce, and 11% studied engineering.

The 2001 census revealed that 61% of immigrants of working age who arrived in the 1990s held trade, college or university credentials in 2001. In comparison, the corresponding proportion for immigrants who arrived in the 1980s and 1970s was about 48%.

The education levels of Aboriginal peoples are also rising. Between 1996 and 2001, the number of Aboriginal people who graduated from secondary school increased from 25% to 27%. Furthermore, the percentage of Aboriginal persons who had completed a post-secondary degree increased from 34% in 1996 to 39% in 2001.

Implications

• Almost half of recent labour market growth has been in highly skilled occupations requiring a university degree.
• Skill shortages can be managed with careful human resources planning by managers and policy makers.

Current and Future Needs

Issue: Convergence of Skills and Competencies toward a Knowledge-Based Economy

Trends

• Between 1981 and 2001, the largest increases in employment occurred in professional and management occupations.
• In 2001, some of the largest concentrations of knowledge workers were in business services (66%), and finance and insurance (42%).
• In 2001, 51.6% of knowledge workers had university degrees, compared to 42.4% in 1981.
• There is no evidence that Canada faces a looming general shortage of skilled workers as a result of population ageing.
• Within the next few years, it is projected that seven in ten new jobs will require some form of post-secondary education or training.
• The average level of education is rising among adults in general and among young adults in particular.
• Technology and business are gaining importance as fields of study.
• 61% of immigrants of working age who arrived in the 1990s held trade, college or university credentials in 2001.
• The educational levels of Aboriginal peoples are also rising. In 2001, 27% had graduated from secondary school, and 39% had a post secondary degree.

Future Needs

• The Public Service needs to be ready to compete for highly educated candidates.
• Human resources planning and research will help alleviate the impact of potential skill shortages.

Labour Relations

The Canadian Labour and Business Centre surveys labour and management in the private and public sectors, to identify their perceptions of the state of labour-management relations in Canada and track the factors underpinning these perceptions as they unfold over time. . Between 2000 and 2002, both managers and labour leaders shared rather pessimistic views on the future of labour management relations.

In 2000, 24% of private sector managers and 36% of private sector labour leaders felt that labour management relations would worsen over the coming two years. Increasing pessimism has been even more apparent in the public sector. In 2000, 36% of labour leaders expected a worsening of labour management relations over the coming years, and two years later, 60% of labour leaders held this view. Growing pessimism is also present among public sector managers; the percentage expecting labour management relations to worsen increased from 28% in 2000 to 42% in 2002.

Among private sector managers who reported better labour-management relations, 63% said their ability to attract employees had improved as opposed to 45% for public sector managers. With 75% of its workforce unionized, the public sector is well above the private sector, which has only 19.9% unionized.

The Public Service Modernization Act is intended to improve the situation by fostering more constructive and harmonious labour-management relations, through departmental union-management consultation committees and informal dispute resolution; co-development of workplace improvements; enhanced mediation and conciliation in collective bargaining; negotiated essential services agreements; compensation research and analysis services; and more comprehensive grievance and adjudication mechanisms.

Implications

• Collaborative relations between management and bargaining agents could help develop and maintain more productive and competitive workplaces.
• To the extent that they affect job satisfaction and the image of the Public Service as an employer, labour-management relations may have an impact on the ability of the Public Service to compete for new talented employees.

Current and Future Needs

Issue: Labour Relations

Trends

• Between 2000 and 2002, both managers and labour leaders shared pessimistic views as to the development of labour-management relations.
• The Public Service Modernization Act is intended to foster more constructive and harmonious labour-management relations.

Future Needs

• The Public Service needs to be able to compete with other employers for new talented employees.