Ottawa Announces $6B Skilled Trades Push to Counter Labour Shortages
Ottawa is putting $6-billion toward boosting employment in the trades in an effort to address labour shortages that risk tripping up the government’s building agenda.
The federal government’s spring economic update, released Tuesday, laid out a suite of measures aimed at increasing the number of young people entering the trades, modernizing the trades education system and providing significant financial support to apprentices as a way of encouraging them to complete training.
Dubbed Team Canada Strong, the package has the goal of growing the number of Red Seal trade workers by between 80,000 and 100,000 by 2030.
Canada has long faced a shortage of skilled tradespeople – a problem that’s expected to get worse as a large cohort of older workers hits retirement age in the next few years. This could become a major impediment to Prime Minister Mark Carney’s efforts to ramp up construction of housing, infrastructure and large resource projects.
Ottawa estimates the country will need more than 1.4 million additional tradespeople by 2033 given the scale of planned construction.
“Think of it as a human-resources strategy to go alongside the major projects capital investment strategy,” Marc Desormeaux, vice-president of policy at the Business Council of Canada, said of the new measures.
“A major challenge for our economy over the long run, particularly to our building ambitions, is to get the right people with the right skills able to fill labour shortages.”
The spring economic update tackles the issue from several different angles.
Ottawa is promising $2-billion over five years to help people aged 15 to 30 gain entry-level trades-related work experience. This includes providing wage subsidies of up to $10,000 to employers to hire, train and retain apprentices.
The government is also promising $3.4-billion over five years to address financial challenges that may prevent apprentices from completing their training. This includes providing $400 a week – up to a total of $16,000 – while they’re attending mandatory classes and providing a “completion bonus” of $5,000 when they obtain Red Seal certification.
Apprenticeship completion rates are worryingly low in Canada. In 2024, 100,000 new apprentices registered, but only about 34,000 completed their apprenticeships, according to the economic update. “If nothing changes, Canada will face a persistent gap of more than 20,000 skilled trades workers per year,” the document said.
Ottawa also plans to modernize the Red Seal certification system, introducing online exams and digital logbooks, and creating a single national registered apprenticeship number. And it said it would support unions to expand and upgrade their own training centres.
Bea Bruske, president of the Canadian Labour Congress, welcomed the measures.
“This is a smart investment in the future of our country,” she said in a statement. “At the same time, we need to see the government invest in building physical and social infrastructure so these skilled workers can be put to work in good, unionized jobs.”
The government’s ambitions to double the pace of home construction and fast-track major projects, such as pipelines, mines and port expansions, is increasing pressure on the already limited labour supply.
“We’re talking a lot about bottlenecks and constraint and execution risk. I don’t think we spend enough time acknowledging the fact that the labour pool that all of these projects are going after is very small,” said Rebekah Young, vice-president of economic policy at Bank of Nova Scotia.
She said the emphasis on training is “a positive shift from the idea that we’re going to bring in skilled labour. We’ll still need to do that in a targeted way, but I think we need to take that long view.”
Ottawa’s emphasis on training young people is particularly important, Ms. Young added. Youth unemployment was 13.8 per cent in March, with many recent graduates struggling to find a job in a weak labour market that’s being upended by artificial intelligence and trade tensions with the United States.
“Youth male, in particular, is a concerning category of persistent ‘not in employment, not in education,’” she said. An early experience of unemployment can have long-term effects “that last a lifetime for those Canadians and impact the Canadian economy overall.”
Matthew Holmes, chief of public policy at the Canadian Chamber of Commerce, said the chamber supports the government’s focus on trades.
“However, this government will need to revisit its restrictive approach to immigration if we’re going to be serious about our talent needs and the country’s growth ambition,” he said in a statement.
Over the past two years, Canada has significantly reduced its immigration levels. Ottawa has a separate immigration stream focused on skilled trade workers, but it is underutilized.
Alongside the training measures, the economic update also increased the annual limit on expenses that can be deducted under the Labour Mobility Deduction for tradespeople. This cap will be increased from $4,000 to $10,000, and the minimum distance someone needs to travel to claim the deduction was reduced from 150 kilometres to 120 kilometres.
This article was first reported by The Globe and Mail
