Ontario / Skills Gaps costs are high and they affect major sectors says The Conference Board

To address a need for information and provide a foundation for informed, effective action, the Conference Board has conducted a groundbreaking study of skills gaps in Ontario, including:

  • a survey of over 1,500 Ontario employers—representing more than 760,000 Ontario employees or 13.5 per cent of the workforce—to identify the near- to medium-term needs of Ontario employers for specific occupations, skills, and post-secondary credentials;
  • original economic analysis to shed light on the true costs of Ontario’s skills gaps to the economy, businesses, and individual Ontarians; and
  • recommendations for educators, students, employers, and governments to address the skills gap—including steps to help better align the skills obtained by future cohorts of students with those needed by Ontario’s employers.

The report, The Need to Make Skills Work: The Cost of Ontario’s Skills Gap, confirms that Ontario faces skills gaps in many areas and that these entail significant costs for businesses, individuals, and the province—there is much that can and must be done to make skills work in Ontario.

Main findings 

The Economic costs of the Skills Gap are high

  • Between 1990 and 2012, the employment rate for individuals whose highest educational attainment is only some post-secondary education or less dropped from 58 to 48 per cent. If more people in this cohort of workers attained the higher education and skills necessary for employment in today’s economy, the contribution to GDP could amount to as much as $24.3 billion annually. An additional $4.4 billion in federal tax revenues and $3.7 billion in provincial tax revenues annually could also be achieved.3
  • At the same time, skills mismatches—where employees’ skills and talents are underutilized by employers—cost Ontario as much as $4.1 billion in foregone GDP annually, and a further $747 million and $627 million in foregone federal and provincial tax revenues, respectively.

Skills Gaps affect major sectors Capture d’écran 2013-06-22 à 08.19.37

  • Skills gaps currently affect many areas of Ontario’s economy, including sectors that account for almost 40 per cent of employment: manufacturing; health care; professional, scientific, and technical services; and financial industries. Moreover, skills gaps and mismatches threaten to worsen, with shortages pro- jected to increase in some areas (generally high- skilled work) and unemployment expected to rise in others (low-skilled work).
  • Results from the Ontario Employer Skills Survey show that employers are in greatest need of post- secondary credentials in the subject areas of science, engineering, and technology; and business and finan- cial professions. In terms of the types of credentials required, the greatest needs are for employees with two- or three-year college diplomas (57 per cent); four- year degrees (44 per cent); and trades (41 per cent).

Chosen excerpts by Job Market MonitorCapture d’écran 2013-06-22 à 08.23.13

via Making Skills Work in Ontario.

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