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You are here: Home  March 2011  Financial News Sobering employment numbers for NL

Sobering employment numbers for NL

Graduates get their e-merit certificates at the recent Lookout! Tourism Summit in St. John’s

ST. JOHN’S NL—Warning employers about the looming employment crisis is nothing new for Wendy Swedlove, CEO of the Canadian Tourism Human Resources Council, who spoke at the recent Lookout! Summit. Indeed, it’s one of her favourite themes. But the demographic picture she painted for Newfoundland and Labrador, a province with ambitious tourism objectives, is truly sobering.

In Canada has a whole, 15 per cent of tourism emplyees [in food and beverage] are in the 15 to 24-year-old age group.  In Newfoundland and Labrador, that figure is 32.8 per cent. “We rely on young employees, because that works when they are going to school,” Swedlove explained.

She also noted that the profile for Newfoundland and Labrador is “very English, with way fewer people born outside of Canada.”

Swedlove added that while there was a surplus of 20,000 people in food and beverage in 2010, the nation as a whole will be short 218,000 people by 2025. “There is a real crunch coming in food and beverage,” Swedlove said.

In Newfoundland and Labrador, the demand curve goes up until 2015, and probably longer.  The supply line, the combination of those born in Canada plus immigration, show that there are shortages now that will increase dramatically.

“We will have to improve our image, because I don’t think we will ever compete on wages,” said Swedlove. “We’ll have to make it more fun, more flexible.  With kids going to school, there’s turnover. We’ll have to identify the folks likely to stay with us and the industry, and train them.”

Partnerships along seasonal lines make sense too—with winter resorts employing people and then sending them to summer destinations.

Richard Alexander, executive director of the Newfoundland and Labrador Employers’ Council, said his group is lobbying to eliminate the payroll tax, reduce worker’s compensation assessment rates and manage increases in minimum wage. He gave the example of the Ocean View Hotel in Gros Morne Park, where the budget for wages has doubled in the last several years.

Compared with the rest of the country, Newfoundland and Labrador pays the highest tax on labour of any province except Quebec. Employers pay for four things—employment insurance, CPP, HPSET (a Health and Post Secondary Education Tax unique to the province) and Worker’s Compensation/EI premiums.

He quoted a Canadian Federation of Independent Business study which noted that payroll taxes have an even bigger impact on corporations than corporate income tax.

“If the tax on labour were removed, 50 per cent [of businesses] said they would hire more people, and 40 per cent said they would increase salaries of existing employees,” Alexander said.

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