No help at the inn – worker shortage pinches employers

As a hotel manager in the tourist haven of Banff, Alta., Ron Bateman is used to hearing his staff say goodbye.

Often it’s the Australians who clean the rooms and run the front desk for a few months between skiing and partying in the picturesque Rocky Mountain town. But lately, more of the locals have left — most for higher salaries in the oil patch, or other hotels offering a fatter paycheque.

“The last two years have become ridiculous. Last August we went through a period where we had three staff to clean 70 rooms. We went for three weeks without receiving any qualified resumes,” says Mr. Bateman, who manages both Banff’s High Country Inn and Red Carpet Inn. “There was a time when we could post a sign on the door saying ‘help wanted’ and have 10 people come in that day to apply. Not any more.”

Keeping employees is a concern for more than half of small- to medium-sized businesses across Canada, according to a new survey conducted by the Canadian Federation of Independent Business (CFIB). It polled nearly 18,000 companies from July to December last year and found 52 per cent could not find enough qualified employees to put on the payroll.

Alberta was the worst off, with 73 per cent of companies unable to find the right employees, compared with a low of 23 per cent in Prince Edward Island.

Construction companies had the most trouble finding workers, according to the CFIB survey, followed by resource and transportation firms.

Thom Hirtz, who had been in the construction business for 30 years, recently switched his business, Toronto-based Group 5, from construction contracting to the energy conservation field. Finding staff to work construction is difficult because many of today’s skilled workers are retiring, he says, and not enough young people have been trained to replace them.

“I got into a different area of the marketplace where I know there is a need,” Mr. Hirtz says.

The human capital shortage is the biggest issue facing small business today, says Dan Kelly, CFIB’s vice-president for western Canada. While the shortages are highest in the west, Mr. Kelly says, about half of small businesses in Ontario (48 per cent) and Quebec (52 per cent) also cannot find enough qualified staff. The shortages are less acute in Atlantic Canada, with the exception of Newfoundland, where 45 per cent of small businesses say they need more workers.

“When close to half of small business in those places say they are short of workers, it’s obvious it’s a pretty gripping problem regardless of where you are in the country,” Mr. Kelly says. “This is a national issue.”

Part of the problem is that small companies cannot compete with wages and benefits offered by the big guys, even though many are compensating staff well above the minimum wage they could be paying, he says.

Canada as a whole is facing a staffing crunch. A recent Manpower Inc. survey of Canadian businesses, both big and small, shows Canada has one of the most serious labour shortages in the industrial world, second only to Mexico. Sixty-six per cent of Canadian employers couldn’t find qualified staff, versus 78 per cent in Mexico, 58 per cent in Japan and 44 per cent in the United States. The global average was 40 per cent.

Changing demographics are to blame.

“We don’t have a lot of people who live in Canada, and for the first time in a long time, we have more people leaving the work force than entering it,” says Michael Doyle, regional director of Manpower.

Small businesses need to better adapt to the changing work force by offering more training and a better working environment, says Gervais Goodman, a national representative of the Strategic Capability Network, a human resources organization.

“Students are coming out of school with the ethical dilemma: ‘Do I want to work for the big buck, or do I want to work for something that makes a difference?’ ” Mr. Goodman says. Small businesses are able to offer a more creative environment, he says, and in turn “will attract brighter, faster, smarter people.”

ExperiencePoint Inc., a Toronto-based technology company, plays up the creative benefits of being a small business to its staff. Not only does it encourage work-life balance through flexible hours but it has a profit-sharing plan for employees.

“It’s an important way to directly connect the organization’s success with the employees who make it happen,” says James Chisholm, one of the company’s co-founders.

Small businesses are beginning to compete for staff with creative uses of perks. Firms are offering flexible schedules, health programs and paid volunteer time. Some fast-food chains have rewarded good workers with mountain bikes and iPod music players. A new Calgary restaurant is giving away a Mexican vacation and $500 signing bonus to all full-time staff who provide three months of service; part-timers also get the cash after the three months, but not the vacation.

Susan Nelson, owner of Inn on the Lake, a 40-room hotel in Fall River, N.S., has a program in which staff can earn points to be redeemed for cash. For example, an employee earns 30 points for a favourable mention from a guest, or 60 points for coming up with a proven cost-cutting tip for the business. Employees receive a dollar for every 10 points, and each year Ms. Nelson budgets $5,000 to give away as part of the incentive program.

While the inn is still losing employees — four in the past three months, for higher-paying jobs in the Alberta oil patch — Ms. Nelson believes in rewarding staffers who stay. “We are doing everything, I think, that we can,” she says.

Gary Bury, owner of Altitude Sports, a retail store in Canmore, Alta., has tried incentive programs and increasing hourly pay but still loses employees at a steady pace. But Mr. Bury, who has owned the business since 1991, sees the current shortage across Canada as part of a cycle that will eventually turn around.

Increasing immigration is one way the Canadian government has tried to curb worker shortages. The previous Liberal government set a goal to increase immigration to 1 per cent of Canada’s population of 32 million by 2010. Recent levels of immigration range from 220,000 to 245,000 annually.

To reach the 1-per-cent target, those levels would have to increase to 320,000 annually. A spokesperson for Immigration Minister Monte Solberg says the new Conservative government has not decided whether it will stick with the 1-per-cent target.

Ottawa also has a foreign workers program through which employers can apply for workers from outside Canada to be brought in, often for a certain time period.

There are a number of conditions, such as the employer has to prove the same job cannot be filled by a Canadian.

The wages must also meet a certain standard, and in some cases employers must foot the bill for airfare to and from the foreign worker’s home country.

Mr. Bateman of Banff says the program is cumbersome with “too many hoops” for some small businesses to handle.

While bringing in more immigrants is one way to try to fill vacant positions, industry watchers say businesses should consider doing more hiring among Canadians who are often overlooked, such as aboriginals and people with disabilities.

Mr. Goodman asks, “What are we doing about engaging other people in our communities?”

Labour needs unfulfilled

Percentage of employers who say they cannot find enough qualified staff.

By province

British Columbia: 60%
Alberta: 73
Saskatchewan: 64
Manitoba: 60
Ontario: 48
Quebec: 52
New Brunswick: 42
Nova Scotia: 31
PEI: 27
Newfoundland: 45
National average: 52%

By sector

Agriculture: 46%
Resource industries: 63
Manufacturing: 57
Construction: 66
Transportation: 63
Wholesale: 51
Retail: 49
Finance; Insurance, real estate: 40
Business services: 45
Education, health, social services: 45
Hospitality, personal services; 46

Based on survey of 17,884 small- and medium-sized businesses conducted from July 1 to Dec. 31, 2005

SOURCE: CANADIAN FEDERATION OF INDEPENDENT BUSINESS