Survey reveals Canada’s skills gap, says businesses unprepared for future growth

Global Study from Oxford Economics and SAP Finds Canadian Companies Face Skills Shortage as HR Departments Prepare for an Increasingly Global, Diverse and Contingent Workforce

TORONTO, Canada — 19 November 2014 — A survey by Oxford Economics has revealed the looming talent crisis facing Canadian organisations. The need for skills like analytics, cloud and programming will grow sizably over the next three years according to Workforce 2020, a global survey of more than 5,400 executives and employees in 27 countries conducted by the independent research group Oxford Economics with support from SAP SE (NYSE: SAP). Through interviews with more than 217 executives and employees in companies across Canada, the survey identified that less than half of Canadian employees (44%) expect to be proficient with most of these key technologies in three years, with only 19% claiming proficiency today.

In terms of solving the skills gap, the Workforce 2020 study found that a mere 38% of Canadian executives say their company offers training programmes to develop new skills, hindering employee proficiency in high-tech skills. The discrepancy between what employees and executives think is important was highlighted when it showed that two thirds of employees surveyed considered training programmes as highly important to their career development.

“Canada’s most competitive companies are embracing technology to grow their business, but at the same time they’re being exposed to the major skills shortage we have for high tech jobs,” said John Hiscox, Vice President HCM, SAP Canada. “To build our businesses, and compete with our global peers, we need to invest in our people and provide the necessary training to be proficient in skills like analytics, big data and cloud. We’ve seen too many Canadian headquartered businesses be bought out by global companies that have already caught up with technology, and we can’t let this trend continue.”

“The re-education of our workforce today is a necessary step to fill the labour shortage we’re seeing for high paying jobs in technology,” said Mark Schrutt, director, Services & Enterprise Applications, IDC Canada. “Education plays a huge role and this extends to every industry such as the public sector and government agencies in their development of skilled workers. Ensuring our workforce and youth are proficient in technology would enable business growth in Canada, and prevent worrying trends we’re seeing such as the offshoring of high tech jobs.”

Top three workforce issues facing companies
In addition to the talent gap, the study challenged much of the prevailing wisdom and highlights the most critical issues facing HR professionals. At the top of the list: 

  1. A new face of work is developing, and companies are unprepared
    According to Workforce 2020, the workforce of the future will look very different to today:
    • 82 percent of Canadian companies say they are increasingly using contingent, intermittent, seasonal or consultant employees.
    • 54 percent say that this requires changing HR policy. Overall, executives are rethinking compensation, training and HR technology in order to adapt to the changing workforce.
    • Only 35 percent of executives said that their leaders are prepared to lead a diverse workforce.
    • Despite this expectation and implications, only 31 percent of Canadian executives say that workforce issues are driving strategy at the board level, and only 35 percent of executives say they have a strong vision of the workforce they want to build in ten years.
  2. Compensation models, development and technology must change
    The changing nature of employment is impacting workforce strategies. According to Workforce 2020, competitive compensation is the most important attribute of a job to 75 percent of respondents. Retirement plans, flexibility and time-off rank well ahead of amenities such as fitness centers, daycare and subsidized food. If compensation is what motivates employees, what they are most afraid of are inadequate staffing, layoffs and positions changing or ‘becoming obsolete’ as a result of developments in technology.
  3. Canadian companies lack adequate leadership
    Executives and employees surveyed agree that leadership is lacking in Canadian organisations — and companies are not focused enough on developing future leaders. Lack of adequate leadership is cited by executives as the number two impediment to achieving their goals of building a workforce to meet future business objectives. Almost half of those surveyed say their plans for growth are also being hampered by lack of access to the right talent within their organizations.

Additionally, 51 percent say that a changing workforce will drive new investments in HR technology that can better support their changing strategies and needs. Investments in HR technology will move beyond traditional HR systems and will be designed to manage the employee record and drive compliance to emerging technologies that support recruiting, talent and performance management, learning and enhanced employee engagement.

  • While more than two thirds (66 percent) of executives say workforce development is a key differentiator for their firm, they do not have the tools and organization to back it up.
  • Just 45 percent of Canadian executives say they have ample data about the workforce to understand their strengths and potential vulnerabilities from a skills perspective, and 51 percent say they use quantifiable metrics and benchmarking as part of their workforce development strategy.
  • Only 47 percent say they know how to extract meaningful insights from the data available to them.

“The workforce of the future is changing dramatically, and companies need to start planning to make this work for them rather than against them,” Hiscox said. “Companies need to start truly embracing a diverse workforce and getting the right technology in place to allow for a more flexible and contingent workforce – otherwise you risk not attracting top talent and falling behind your peers.”

To learn more about the global results of Workforce 2020 and the future of work, visit the Workforce 2020 page. Follow the #workforce2020 conversation with SAP on Twitter at @sapnews and SuccessFactors at @successfactors and the SAP News Center.

About SAP
As market leader in enterprise application software, SAP (NYSE: SAP) helps companies of all sizes and industries run better. From back office to boardroom, warehouse to storefront, desktop to mobile device – SAP empowers people and organizations to work together more efficiently and use business insight more effectively to stay ahead of the competition. SAP applications and services enable more than 261,000 customers to operate profitably, adapt continuously, and grow sustainably. For more information, visit www.sap.com.

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