If Canadian businesses fail to mobilize immigrant talent, Canada will miss one of the enormous global economic developments now underway.
Canada’s population grows more diverse every year.
Oddly, our trading and export patterns have not diversified to the same extent. We remain woefully dependent on trading with the United States.
Today, Canada attracts more immigrants from Asia and Latin America than from Europe. But only China and India are among our top 10 trading partners. One reason is that we’re not doing a good enough job integrating immigrants economically. The diversity of our people is one of Canada’s strengths but we’re not capitalizing on this comparative advantage.
This is a large and growing problem because diaspora networks are becoming more and more important to global economic growth.
As a new study we are releasing today called Diaspora Nation finds, Canadian businesses that discover how to tap into emerging markets such as Brazil, China, India and the Philippines will thrive in coming decades.
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If Canadian businesses fail to mobilize immigrant talent and expertise, Canada will miss one of the enormous global economic developments now underway. Patterns of immigration are changing dramatically.
Not long ago, immigrants would settle in new countries and maintain sporadic contact with their countries of origin. Today we live in a world where more people move around the globe, have multiple national identities and have sustained contact with multiple countries.
Canadians can no longer take for granted that we will be able to attract and retain the immigrants we need in a competitive global market for talent. We must up our game and do a better job ensuring that the economic opportunity that immigrants expect — and that is increasingly available around the world — is delivered.
Diaspora networks are increasingly powerful social and economic forces with cultural knowledge and substantial connections to economies and communities beyond Canada’s borders. Canadians are connected to all corners of the world in unprecedented ways. Diasporas provide linkages. They help information circulate. They provide cultural knowledge where it didn’t exist before. They can help establish trust and deepen social capital. Their knowledge can lower transaction costs and reduce the time it takes to enter new markets and form new partnerships. They connect people, ideas and understanding.
Canadians have a general awareness of these benefits.
When Toronto hosts the International Indian Film Academy Awards or Africa Fashion Week we are briefly reminded of the cultural and economic opportunity that our diaspora networks provide. But it is not consistently a front-of-mind consideration for decision-makers in the private and public sectors.
We are failing immigrants and Canada when we fail to recognize the cultural knowledge, international experience and global networks of our people. We can do better.
The private sector could deepen its connections with ethnocultural chambers of commerce, professional immigrant networks, alumni networks and immigrant resource groups within firms. All these networks can help businesses better understand opportunities in emerging markets.
Successful firms are already doing this. But capitalizing on our potential requires more than the private sector. It requires governments to ensure that rules and regulations from a half century ago are not undermining our capacity to fulfil our potential as a diaspora nation. Student and business visas are too frequently delayed. Small- and medium-sized businesses do not have access to the insurance they need to explore new export markets. Unrealistic residency requirements are imposed on immigrants preventing them from travelling for business.
There are too many obstacles to global philanthropy.
We too often require “Canadian experience” for employment when such a requirement is unnecessary. Those who process remittances are not subject to appropriate regulation and too often take advantage of their clients.
The list is long.
Once we put the goal of harnessing our diaspora networks as a top strategic priority for the country, the unintended consequences of many of our rules and regulations become apparent. We need to start to act like a country that takes the opportunities of diaspora networks seriously.
Matthew Mendelsohn and Serene Tan work at the Mowat Centre at the University of Toronto. The report, Diaspora Nation, by Maurice Bitran and Tan, will be released today at mowatcentre.ca
When the premiers meet Thursday in Niagara-on-the-Lake, jobs and skills will be at the top of the agenda. All governments should agree that a comprehensive skills agenda to help workers is necessary for Canada to remain competitive and for Canadians to feel economically secure.
And that’s why most of Canada’s premiers are disappointed with the federal government’s announcement that it will unilaterally cut the transfers that provinces use to pay for job-training programs.
The programs that the federal government plans to cut — delivered under the Labour Market Agreements — are those that fund training for Canadians who are not eligible for Employment Insurance. These workers are typically the most vulnerable and hard to serve. Many of the programs that could be cut are those that support the essential literacy and numeracy skills that are critical for unemployed Canadians to re-enter the workforce.
Why the federal government has chosen to pick a fight with the provincial governments that run the programs is a mystery. This very same federal government spearheaded these programs and was touting their success until the day it announced the decision to tear up the agreements. The federal announcement also goes against the government’s frequent promises that it will not cut transfers to provinces and will stay out of areas of provincial jurisdiction.
The federal government is proposing to use the $300 million diverted from the Labour Market Agreements to create a new program called the Canada Job Grant, which would pay employers to train workers through educational institutions. Employers would have to kick in one-third of the funds, and provincial governments would likewise have to come up with an additional third.
This would act as a windfall subsidy to employers who already provide the type of training covered by the program — mostly large employers — who could see their training bill fall by two-thirds. But it would probably be too complex and bureaucratic for many small and medium-sized employers to access.
Given that the maximum grant from the federal government would be $5,000 per trainee for short-duration programs, it is hard to see how this would actually help provide workers with the advanced skills they need to take the high-skill jobs where there really are labour shortages. There is simply no evidence to suggest that these small subsidies to large firms would be more effective than the current programs that provinces and communities have been building over the past decade to help unemployed people get jobs.
If the program goes forward, provincial governments will be on the hook for $300 million for this new program, and will have to come up with another $300 million to fund the training programs they currently offer. The federal government, on the other hand, won’t have to come up with any new money because it would fund its share of the program from the cuts it makes to existing transfers to support job training.
The federal government is changing the rules, sending the provinces a bill for $600 million, and not spending a cent of new money on skills training — all the while running ads touting its great new program for the unemployed. It’s not surprising that provinces are miffed.
But it doesn’t have to be this way. The appointment of a new minister, Jason Kenney, provides the federal government with an opportunity to hit the re-set button on the Canada Job Grant.
The federal and provincial governments all agree that Canada needs more and better skills training for unemployed people. No one suggests that every current program is perfect. Most recognize that the federal government has a role to play to strengthen the Canadian economic union and improve the functioning of the labour market. But a unilateral approach, along with cuts to transfers, will hurt, not help the shared goal of a highly skilled workforce and an efficient national labour market.
Nine years ago the premiers met in Niagara, just as they are doing this week, and agreed that a new era of federal-provincial co-operation was necessary for health care. The result was eventually the Canada Health Accord, which provided a decade of shared commitment to improving health care in Canada. Coming out of this week’s meeting, governments should strive for that same level of common cause on Canada’s skills agenda.
Federal and provincial ministers should come together, identify which programs have delivered the best results, and re-negotiate new Labour Market Agreements. Employers could certainly have a role. Canadians should not have their jobs and training caught in the middle of an intergovernmental dispute.
Matthew Mendelsohn is director of the Mowat Centre at the University of Toronto and a former intergovernmental affairs deputy minister in Ontario. The Mowat Centre/Caledon Institute paper The Training Wheels Are Off: A Closer Look at the Canada Job Grant, was released this spring (mowatcentre.ca).
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