(Toronto) A shortage of skilled workers and funding is hurting manufacturers’ ability to adopt new technologies, a new survey finds.
According to the results of a survey conducted by Canadian Manufacturers & Exporters, 40% of respondents have not yet started or are just starting a digital transformation.
A third of respondents cited the shortage of skilled workers as a major barrier to adopting new technologies.
Dennis Darby, who leads the trade group, says small businesses need to be supported by tax credits that reduce investment risk and offset the cost of employee training.
“We need more targeted government support for these companies to accelerate the adoption of technology in our manufacturing sector, or we will jeopardize our economic competitiveness and our standard of living,” said Mr. Darby in a statement.
The industry group is calling for a 10% federal investment tax credit matched by all provinces – it is already available in Atlantic Canada and the Gaspé Peninsula – as well as more vocational training streams in high schools.
In its spring budget, the federal government focused on green technology by rolling out a clean technology manufacturing investment tax credit set at $4.5 billion over five years.
The Liberals also unveiled plans in November to increase immigration, targeting 500,000 new Canadians a year by 2025, the majority of whom would be skilled workers.
The current labor shortage explains why a quarter of respondents have yet to adopt any of the nine “software solutions” — relating to warehouse management and equipment efficiency, for example — identified in the survey . Another 10% avoided “advanced technologies” such as cybersecurity and cloud computing.
The problem is particularly acute among small businesses – a “major problem”, since some 93% of the country’s 52,000 manufacturers employ fewer than 100 workers, said Alan Arcand, the trade group’s chief economist.
“Their tendency to be slow to adopt technology also affects the wider industry, as many small businesses provide products and services to larger companies,” he wrote in a report accompanying the survey. .
This slow adoption has resulted in “stagnant labor productivity,” he added.
According to the Organization for Economic Co-operation and Development (OECD), Canada ranks among the last among advanced economies in terms of growth in non-residential capital investment in recent years.
Data from this group of 31 countries reveals that between 2016 and 2020, Canada had the second weakest performance in business investment. Non-residential investment fell at an average rate of 1.8% — although the collapse in energy investment at that time may be the main culprit for this, Arcand noted.
“While labor shortages typically drive companies to invest in automation technology, talent shortages have the opposite effect and discourage manufacturers from moving forward with this critical step,” he wrote.
Conducted this month, the Canadian Manufacturers & Exporters survey is based on responses from 279 manufacturers across the country.