How skills-based approaches can close the opportunity gap

The COVID-19 pandemic has left an indelible impact on the world of work. But long before virus infection rates began to rise, Canada faced skill shortages, skill gaps and pressing questions about the sustainability of its labour market. As the country looks toward recovery and beyond, immigrant talent must be actively included in all efforts of recruitment, reskilling and retention, using a skills-based lens. Competency frameworks and skill assessments provide a transparent and standardized frame of reference for identifying occupational skills requirements and determining job suitability, especially in the case of those who have international education and training.

With most estimates agreeing that the Canadian economy will be wholly dependent on immigrants by 2030 to offset an aging national population, the question of how to bridge the gap between employers and immigrant talent remains. Few employers, especially small- and medium-sized enterprises, are equipped to address this gap by recruiting, retraining and retaining internationally trained individuals. Forty per cent of SMEs named talent shortages as a major competitive barrier, but entrepreneurs ranked hiring newcomers as the strategy they were least likely to use to address the issues. Addressing this gap is essential for employers in construction, retail, information and communications technology, and manufacturing, even more so in the Atlantic provinces, Ontario and British Columbia.

What these findings reveal is an opportunity gap. Royal Bank of Canada estimates that the immigrant wage gap — due in part to salary differentials and the devaluing of international experience — costs Canada at least $50 billion in annual gross domestic product.

Employers across all sectors and regions have raised alarms about a skills gap for the past decade. Although Canada welcomes hundreds of thousands of skilled immigrants to the country each year, the supply does not always correspond to the demand. This mismatch is due in part to the government’s immigration application and selection process, which relies on metrics and methods of identification and assessment that do not paint the whole picture of either the applicants’ skills (supply) or the employers’ needs (demand). The academic credential evaluations that are currently required are an important part of the immigrant selection process, but provide only one piece of the puzzle. While they enable applicants to provide expert analysis of verified academic credentials to regulatory bodies, academic institutions and employers, these credentials are not always recognized. Nor can academic evaluations offer employers the verification of the specific skills and competencies they are seeking.

For example, employers are increasingly focusing on skills-based qualifiers in job postings to balance academic credentials and skills. Skills-based job postings focus on occupational and foundational competencies to shortlist candidates and distinguish between required and preferred credentials by considering alternative pathways to skill development in combination with regulatory requirements. However, the selection process of Canada’s immigration system is not skills-based and does not include actual skill assessment. Using skill-identification and competency assessments in combination with credential evaluation would provide an opportunity for an increased recognition and acceptance of diverse talent, limiting the application of bias toward candidates from the same region, culture or even academic institution as the hiring manager. Applying a skills-based lens to many of our labour market processes — such as immigrant selection process, settlement and career services provision, intake and referral for academic purposes, and employment, recruitment and retention — can support a recovery that is more inclusive of all available talent by leveraging clear and consistent frameworks, benchmarks and assessments.

Skills-commensurate employment is one of the clearest indicators of successful settlement and integration at the individual level, and it is an important characteristic of communities that thrive socially and economically. To this end, workforce development and talent pipeline management approaches that are more intentional in their inclusion of skills-based interventions should be broadly examined.

Government investment must be holistic in order to ensure a system that increases both individual economic mobility and sustainable economic growth. Tools and technologies must be able to assess competencies and determine future labour market demand; standardize skills-based intake, assessment and referrals at the service-provision level; and further sector-based development of occupation-specific competency frameworks.

When the focus shifts from a “skills gap” (seeing candidates as having deficits) to an “opportunity gap” (seeing the system itself as deficient), it becomes possible to develop more equitable systems of selection and assessment. This shift would involve more than short-term interventions or minor adjustments in government policy. A broader, more holistic lens on assessing immigrant talent, and one collaboratively developed by government, service delivery partners, employers and academic institutions, would allow us to achieve a more productive and effective workforce in the post-COVID recovery period and beyond.