Green Transition and Skills in Canada – 3.1 million jobs will be disrupted over the next 10 years

Green Collar Jobs is the latest report in RBC Economics and Thought Leadership’s climate series, building from the team’s flagship report, The $2 Trillion Transition, which was launched in October 2021. This climate series is designed to inform and inspire Canadian prosperity, while advancing RBC’s ongoing commitment to speak up for smart climate solutions, a key pillar of RBC’s Climate Blueprint.

Key findings

• 3.1 million Canadian jobs—or 15% of the labour force—will be disrupted over the next 10 years as the country transitions toward a Net Zero economy.
• 8 of 10 major economic sectors will be affected as the workforce adapts.
• Canada’s transportation, energy and manufacturing sectors will undergo the most significant early shifts, as 46% of new jobs in natural resources and agriculture and 40% of new jobs in trades, transport, and equipment require an enhanced skillset.
• Initial changes will affect highly-paid, highly-skilled workers more dramatically. Managers in engineering, architecture, utilities and manufacturing are already seeing over 50% of their tasks shift due to the climate transition—five times that of managers on average.
• For workers, upskilling could also bring significant opportunities. Between 235,000 to 400,000 new jobs will be added in fields where enhanced skills will be critical.
• A highly-skilled Net Zero workforce could establish Canada as a top destination for green investment, building on existing advantages, including a free trade pact with the U.S. and Mexico and large deposits of natural resources critical to clean technology.
• A comprehensive skills strategy must be a key pillar of Canada’s $2 trillion Net Zero transition, particularly as other countries compete for investment.

Why skills are the key to green economic growth

Canada is on the cusp of a generational skills crisis. As a nation, we’ve set some of the most ambitious climate objectives in the world, led by an overarching goal to reach Net Zero emissions by 2050. This pursuit brings with it an abundance of opportunity: for Canadian innovation, for new green investment, and for economic growth.

But none of it will happen without people. Our journey to Net Zero hinges not just on the large-scale mobilization of financial capital but also, critically, human capital. According to our research, 3.1 million Canadian jobs will change in some way over the next decade due to the climate transition. Traditional energy sector workers will need to be bridged to new, growing areas of the economy as this evolution plays out. But as our research shows, equally important and wide-ranging skills shifts are already taking place in other parts of the economy.

Companies like Vancouver’s Ballard Power Systems, at the forefront of the energy transition, will need engineers trained in the rapidly-evolving technology of hydrogen fuel cells. Long-established industrial giants like Sault Ste. Marie’s Algoma Steel will need to recruit and retrain workers as it overhauls its operations to rely on clean electricity. Firms like Oakville-based Samuel, Son & Co.—one of the largest North American metals processors, now pivoting to automation, robotics and innovative new forms of manufacturing—will increasingly seek engineers, workers with hybrid skillsets and those with training in new disciplines like mechatronics (integrating mechanical, electronic and electrical engineering), as it aims to make supply chains more efficient. And nearly everywhere, across nearly every industry, Canadian companies will need more traditional skilled tradespeople—the metallurgists, welders, machinists and other workers already in severe short supply.

To meet the moment, Canada needs a strategy—and a workforce nimble enough to keep pace with the rapid technological and operational changes driving the climate transition. We’ll need new models of collaboration among businesses, government and post-secondary institutions. We’ll need companies driving cutting-edge innovation to take a bigger role in work-integrated learning and training. And we’ll need workers and students to adopt a mindset of constant learning. Chronic problems will have to be tackled too, including longstanding bottlenecks in our pipeline of skilled tradespeople and a failure to tap into underutilized pools of talent such as women, immigrants and Indigenous youth.

Skills must be at the heart of any strategy to achieve Canada’s new target of cutting emissions by at least 40% by 2030. Yet so far, our discussions have been largely limited to debate about regulation and technology.

In this report, we examine the transformations already underway in Canada’s labour force as the country moves to a Net Zero economy. We map out the sectors and occupations experiencing the greatest disruption, the ways skills are shifting within specific professions and the competitive advantage that a green workforce will bring. The challenge ahead is sizeable, but for workers and employers alike, the payoff could be significant: as many as 400,000 new jobs will be added in fields that will demand enhanced skills. The importance of these green skills can’t be overstated—equipping Canadians with them is the only way to get to Net Zero.

Recommendations: Seven Ways to build a Net Zero skills strategy

1. Make skills a central component of Canada’s Net Zero strategy. This will require Ottawa and the provinces to form an expert group to collaborate on funding, skills certification and labour mobility issues.
2. Map out Canada’s green skills gaps and opportunities. This will require Employment and Social Development Canada to collect, analyze and publish data on the underlying skills shift and projected employment in the Net Zero economy. Currently, Canada lags behind other countries like France that have national observatories to monitor the job transition. Robust information about how our workforce will change in the coming decades is critical to good labour force policy.
3. Allocate funding in the upcoming budget to create a proactive strategy for retraining workers in sectors impacted by climate change today. Easing the transition of skills between trades and in occupations impacted by the transition will be critical. A key part of any strategy must be encouraging labour mobility. Regulators must collaborate to break down interprovincial mobility barriers for workers to facilitate smooth work transitions.
4. Enable small and medium-sized businesses to create the green collar jobs of the future. While large businesses may have the resources to implement enterprise skills strategies, the smaller firms and startups that are also driving the Net Zero transition will need greater support. Government agencies that work directly with small businesses, like the Business Development Bank of Canada, can be powerful agents in helping design and fund transition strategies. Government policy support can include federal tax credits and provincial subsidy programs for small businesses looking to upskill staff and self-employed workers in need of retraining.
5. Revise immigration strategies to ensure Canada is attracting, recruiting and integrating newcomers with the right skills for green collar jobs. Immigration targets should be reviewed and reshaped to reflect current and future demands for skills to support the Net Zero transition. Greater effort should be paid to mirroring credentials so workers can more rapidly become a productive part of the labour force.
6. Provincial labour regulators should work together to standardize job requirements in sectors that will need to draw labour from other parts of the country or world. Canada will need to draw on new pools of talent both within its borders (women, Indigenous people and youth) and beyond (immigrants).
7. Create new and accessible pathways for green skills training and careers through work-integrated learning and upskilling and re-skilling programs. Post-secondary institutions and employers should find new collaboration models to create quality green collar programs. Special focus should be paid to small and medium-sized enterprises, underrepresented Canadians and those whose livelihoods are most disrupted by climate change.

Chosen excerpts by Job Market Monitor. Read the whole story @  Green Collar Jobs: The skills revolution Canada needs to reach Net Zero