Workforce development will fuel our future – Here’s how to get there

Workforce development will fuel our future – Here’s how to get there

Ontario has ambitious economic goals: strengthening economic sovereignty, improving productivity, and boosting competitiveness. But none of that is possible without a strong workforce. And right now, our talent pipeline is leaking.

Critical industries such as skilled trades, healthcare, and construction are facing persistent labour shortages.

Small-and medium-sized enterprises (SMEs), the backbone of Ontario’s economy, are particularly vulnerable to these pressures. Macroeconomic forces such as wage expectations, skills shortages, housing affordability and supply, emerging technologies such as AI, and evolving immigration policies are collectively creating a complex operating environment.  

Without coordinated action across government, business, and academia, we risk leaving economic growth on the table.

A Talent Disconnect We Can’t Afford

To explore these challenges, the Ontario Chamber of Commerce’s Workforce Development Policy Council hosted a thematic meeting on talent supply gaps, which featured insights from the Canadian Manufacturers and Exporters. This meeting was followed by an in-person networking session on recruitment, retaining, and reskilling with presentations from, Human Resources Professionals Association, and the Centre for Education and Work Integrated Learning. Industry leaders shared a clear message: the status quo isn’t working.

Experts highlighted barriers including skills mismatches, aging demographics, limited career pathways, and the underutilization of internationally trained professionals. For instance, immigrants represent over half of all 25-64-year-olds in Canada with a STEM degree. Significant number remain underemployed. This highlights a persistent disconnect between talent and opportunity. At the same time, recent shifts in immigration policy to reduce immigration intake, while aimed at easing pressure on housing and services, risk compounding talent shortages in sectors that desperately need workers. 

Recruitment & Retention Must Evolve 

We also heard another consistent theme: to remain competitive, employers must rethink how they attract and retain talent. Current trends such as hiring delays, burnout, upskilling pressures, gaps in technological leadership, and hiring freezes are impacting growth and stability across sectors.  

Organizations should pivot away from overly rigid, credential-based hiring and shift to a more holistic approach that values and recognizes transferable skills and long-term potential. For SMEs without dedicated HR teams, engaging fractional HR professionals on a needs basis can be a practical solution and cost-effective solution. This model helps reduce bias, offloads administrative burden, and addresses capacity challenges. 

Retention is equally critical. Replacing a single employee can cost more than 30 per cent of their annual salary when accounting for lost productivity and onboarding. Investing in career development programs, flexible work arrangements, fair and competitive compensation, and inclusive culture help build a resilient and future-ready workforce where employees feel supported and engaged. 

We also can’t talk about workforce development without addressing equity. Indigenous Peoples face lower employment rates than non-Indigenous populations, limited access to training opportunities, and are underrepresented in the skilled trades, STEM fields, and leadership roles. Targeted investments in Indigenous employment programs, mentorship, and culturally save workplaces are essential to closing this gap.  

Futureproofing Ontario’s Workforce 

We’re not just facing labour issues; we are in the midst of a profound transformation. Technologies like AI are reshaping entire industries, and we must prepare for what’s next, not just what’s now. As highlighted by a panelist from the Centre for Education and Work Integrated Learning, AI should be embraced as a “thought partner,” not a threat. For many businesses, especially for SMEs, it can streamline operations and unlock growth.  

This transformation also means doubling down on upskilling. Strategic partnerships with post-secondary institutions — especially those offering work-integrated learning (WIL) – are key to preparing young people for high-demand sectors like mining, clean energy, and advanced manufacturing, where talent attraction remains a challenge. 

Ontario Must Act Now

The good news? We already know what works. We need to scale up what’s effective and remove barriers to implementation. That includes:  

• Expanding experiential learning and training programs
• Aligning immigration policy with labour market needs
• Investing in Indigenous and newcomer workforce development
• Supporting SMEs with flexible, accessible HR solutions
• Promoting inclusive hiring and skills-based recruitment

Ontario’s economy is only as strong as its workforce. The longer we delay comprehensive action, the more competitive ground we lose.

Retention starts at recruitment. Innovation begins with people. Workforce development is not a side project; it is an urgent economic priority.