The labor shortage is no longer a new phenomenon in Quebec. Entrepreneurs are now navigating this new reality. As for consumers, we perceive an adaptation in the face of the reduction in the provision of services.
According to the most recent data from the Canadian Federation of Independent Business (CFIB), there has been a slight drop in the number of SMEs directly affected by the lack of personnel. 1 In September 2022, this figure was 66% of Quebec SMEs, while in May 2023 it was 60%. But let’s wait before jumping to conclusions. The proportion of SMEs heavily affected remains unchanged at 85%, either directly (through lack of employees) or indirectly (all employees, but costs increase).
Given the enormous pressure on SME managers, more needs to be done to help them overcome labor scarcity. Because the consequences are direct: the equivalent of an eight-day week for business leaders in need of employees2and major economic losses for SMEs3.
The pressure is such that nearly half of SMEs assess a short (6%) and medium term (40%) risk to their survival if the problem persists or worsens!
Note that when we compare these results with those of 2021, we still see an improvement in the situation. In fact, the number of small business owners believing that their business could not survive for less than a year has been reduced by half. As for the medium-term impact (1 to 4 years), the proportion fell from 45% in 2021 to 40% in 2023. However, the share of SMEs that do not think they will survive in the long term (more than five years) has experienced an opposite evolution, going from 23% in 2021 to 33% in 2023.
We can therefore see that the efforts of companies and government actions are bearing fruit.
But we must continue, even accelerate the pace of actions in support of SMEs. Remember that 95% of businesses in Quebec as a whole have fewer than 50 employees. We therefore have every interest, for our economic future, in ensuring that small businesses can meet the challenge of the labor shortage.
Immigration and tax burden
Small business owners are looking to fill full-time positions for production and skilled trades staff (80%), technical and administrative staff (50%), sales staff (46%), and executive and managerial positions (34%). Here, the Government of Quebec can help them by implementing an immigration policy that meets the specific needs of SMEs and by developing training programs adapted to the labor market of today and tomorrow.
The Ministries of Employment, Immigration, Education and Higher Education have a key role to play.
SMEs are also asking the Quebec government to increase tax credits and reduce their tax burden, to enable them to offer better working conditions or automate their processes.
The latter are also calling for an improvement in tax credits intended for individuals in order to make the labor market more attractive. In this context, the actions of the Ministries of Finance and the Economy are fundamental to better equip and support small businesses and their employees.
Inform about available programs
In addition, entrepreneurs work crazy hours and have less and less time for themselves, which is the first consequence of the labor shortage. Result: less than a third of SME managers are informed of the programs and measures of the Quebec government aimed at helping businesses recruit and train employees.4
This striking fact is a reminder of the importance of further reducing the paperwork of businesses. The work of the Minister Delegate for the Economy, responsible for regulatory and administrative streamlining, is central to supporting SMEs. The government also has work to do to better support these measures.
It is imperative to move up a gear with regard to concerted action to combat the labor shortage in Quebec. Targeted measures are needed, and the creation of a government action group, co-chaired by the Ministers of Employment and the Economy, could improve the coordination of concerted efforts.
We can lead the way in overcoming the obstacles posed by the labor shortage by working together to deploy more measures that will concretely help SMEs. Let’s start now.