Rising costs and recruitment challenges are the biggest barriers Canadian businesses expect to deal with over coming months.
The Canadian Chamber of Commerce Business Data Lab’s analysis of the Canadian Survey on Business Conditions (which surveyed 17,695 businesses) found 50% of businesses singled out rising input costs as an obstacle for their business for the next three months. Four out of the top eight obstacles listed are related to rising costs, including insurance and transportation. Three of those top eight obstacles are related to labour challenges, including recruiting and retaining skilled employees. Supply chain challenges round out the list of most pressing obstacles for business.
To deal with workforce challenges, businesses are offering more. Over the next three months, 45% of businesses expect to increase wages for existing staff, 24% expect to increase wages for new hires and 6% expect to offer signing bonuses or incentives. Other popular solutions include flexible scheduling, professional training, and increased benefits.
The accommodation and food service cited the least optimism and topped the list in its workforce struggles with 65% of businesses citing a shortage of labour force as an obstacle. This sector is also leading the way in wage increases, with 58% anticipating they will increase wages, including 32% who expect to raise wages by 10% or more.
Despite pressures of rising costs, access to the funds to do it adds to that challenge, with 28% of businesses in the accommodation and food service sector reporting that they cannot take on more debt.
With a workforce that is increasingly looking for flexibility in working hours and working from home, the food and accommodation sector offers the least flexibility due to the nature of what they do.
News that Ontario is moving ahead with the federal government on a $10-a-day childcare plan is a welcome relief for young families and businesses alike. The first step is a 25% reduction in child care fees effective April 1.
Women have been disproportionally affected by COVID-19 in terms of being employed in the most vulnerable and hardest hit sectors (like accommodation and food service) as well as taking on significant childcare issues.
The Ontario Chamber of Commerce has been advocating that women’s participation in the labour market is a precondition of our economic recovery and future prosperity. Offering affordable childcare is a significant step to easing costs for young families and making it more accessible for parents to take on a larger role in the workforce.
The Ontario Chamber of Commerce also states that to make the childcare agreement viable, the childcare sector needs an adequate supply of qualified workers. This includes recognizing foreign credentials, enhancing online training, fast-tracking in-school credentials, and developing financial support for underemployed populations to access training opportunities.
Affordable childcare will offer families help while having positive effects on access to labour – but more support is needed for our hardest hit businesses. It’s apparent that some business sectors are going to be dealing with the economic effects of COVID-19 for some time.
What is lower down on the list of obstacles facing businesses is customer demand. People still want to dine, travel, shop, and renovate. We have a significant role to play as consumers to spend our money locally, including patronizing local restaurants and attractions. We can help our local businesses recover and thrive.
The Peterborough and the Kawarthas Chamber of Commerce acts as a catalyst to enhance business growth, opportunity, innovation, partnerships and a diverse business community.