Understanding Apprenticeship Requirements and Workforce Qualifications in the Canadian Labour Market Project Sponsor The Canadian Apprenticeship Forum – Forum canadien sur l’apprentissage (CAF-FCA) is a national, not-for-profit organization working with stakeholders in all regions of Canada. We influence pan-Canadian apprenticeship strategies through research, discussion and collaboration – sharing insights across trades, across sectors and across the country – to promote apprenticeship as an effective model for training and education. Our Board of Directors is comprised of representatives of business, labour, the jurisdictional apprenticeship authorities, education and equity-seeking groups. Through our work, CAF-FCA has shed light on a number of key issues affecting apprenticeship, such as the perceived barriers to accessing and completing apprenticeship and the business case for apprenticeship training. For more information, visit the CAF-FCA website at www.caf-fca.org. Working Group Members Danny Bradford, National Union of Public and General Employees Dorothy Easton, BC Industry Training Authority Neil Fassina, Northern Alberta Institute of Technology, Alberta John Hoicka, Colleges Ontario Supriya Latchman, Ontario College of Trades John Schubert, McCaine Electric Ltd., Manitoba Deborah Shaman, Employment Social Development Canada Andrew Shepherd, Automotive Industries Association of Canada Karen Walsh, Office to Advance Women Apprentices, Newfoundland and Labrador Gina Wong, Apprenticeship and Student Aid, Alberta Innovation and Advanced Education CAF-FCA acknowledges the research contribution of Prism Economics and Analysis. This project is funded by the Government of Canada’s Sectoral Initiatives Program. Table of Contents 1.0 Introducing Qualifications-Based Labour Market Information . . . . . . 2 2.0 Features of the Qualifications-Based Tracking System. . . . . . . . . . . . 4 2.1 Stage 1 General Labour Market Conditions. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5 2.2 Stage 2 The Impact of Apprenticeship Programs. . . . . . . . . . . . . . . . . . . . . . . . . . 5 2.3 Stage 3 Profiles of Trade Qualifications . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6 3.0 Summary Information for Ten Trades. . . . . . . . . . . . . . . . . . . . . . . . . . . 8 4.0 Conclusion . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11 Appendix A List of Principle Trades and Related Occupations. . . . . . . . . 12 List of Figures Figure 1 The Structure of the Qualifications-Based Tracking System. . . . . . . . . . . . . . . . . . . 4 Figure 2: Employer Hiring Preferences . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6 Figure 3: Summary Table for Ten Trades. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8 2 1 Introducing Qualifications-Based Labour Market Information The Canadian Apprenticeship Forum - Forum canadien sur l’apprentissage (CAF-FCA), in collaboration with its project consultant, Prism Economics, is giving apprenticeship stakeholders new insights into the impact of apprenticeship on the labour market by linking employer hiring preferences and apprenticeship registrations/completions with qualifications-based labour market information (LMI). For the first time, apprenticeship stakeholders will gain insights into pressing questions, including: • What is the role of apprenticeship programs in addressing labour market imbalances and skill availability in the trades? • What importance do employers attach to apprenticeship-related qualifications? • Will current registrations/completions be adequate to meet employer demand for tradespeople? This summary report provides a high-level overview of the qualifications-based tracking system and its three constituent parts – general labour market conditions, the impact of apprenticeship and trade qualification profiles.1 The system has several advantages and unique characteristics: Trade Specific: Insights on specific trades and related occupations that require a Certificate of Qualification. A principle trade is defined by its link to one or more specific apprenticeship programs. For a list of trades and related occupations, see Appendix A. 1 For a more detailed description of the system, see the full report “Tracking Labour Requirements and Workforce Qualifications: A New Pan Canadian Approach.” Email info@caf-fca.org for a copy. Qualifications-Based: An examination of the demand for trade qualifications that considers economic trends such as: • the shifting mix of available qualifications and the impact of industry cycles and major projects, • differences in general market cycles, • supply and demand balance by qualification, • retirement trends and • changes in immigration. Employer Recruiting Preferences: The system includes employer input. Trade-specific hiring preferences for apprenticeship training and journeyperson qualifications are included in the analysis. Comparative Analysis: Trends are tracked and compared over the past ten years, with projections made ten years into the future. Related Occupations: Eighty-five related occupations have been identified and included in the system. The working population of journeypersons spreads far beyond the trades labour force and extends into a large number of related occupations that also require a Certificate of Qualification. When thinking about potential demand in the labour market, these related occupations must be considered as they will increase the demand for certified tradespeople in certain trades. 3 • the primary role of journeypersons in the workforce, • cycles of registrations and completions, • completion rates and • compulsory/voluntary status. Sources: The information has been drawn from detailed LMI, apprenticeship data from the Registered Apprenticeship Information System (RAIS), a national employer survey (N=500), Citizenship and Immigration Canada (CIC) data and the 2011 National Household Survey.2 Geographic Focus: Data analysis in this stage of system development was confined to British Columbia, Alberta, Ontario and Atlantic Canada, in an effort to provide proof of concept across major regions of Canada. Insights, like the ones generated through this system, are essential to effectively planning and managing apprenticeship programs. This information is expected to help industry, employers, educators, labour representatives and administrators meet industry demand for apprentices and promote workforce skills development. 2 A detailed explanation of the sources and the methodology is described in the full report. Understanding Apprenticeship Requirements and Workforce Qualifications in the Canadian Labour Market Apprenticeship Specific Insights: Apprenticeship specific insights are captured by analyzing: 4 2 Features of the Qualifications-Based Tracking System This apprenticeship-focused analysis distills the broad findings of standard LMI into detailed profiles of qualifications for specific trades. There are three distinct stages in the assessment of conditions for each trade: general labour market conditions, the impact of apprenticeship and profiles of trade qualifications. Each stage helps apprenticeship stakeholders understand the mix of qualifications and the depth of skills in the workforce. See Figure 1 for a visual representation. FIGURE 1: The Structure of the Qualifications-Based Tracking System GENERAL LABOUR MARKET CONDITIONS THE IMPACT OF APPRENTICESHIP SKILL PROFILE BY TRADE IMPLICATIONS FOR ACTION BY: • Program Managers • Trainers NATIONAL • Union Leaders • Employers PROVINCIAL TRADE 5 2.2 Stage 2 The Impact of Apprenticeship Programs At a broad level, the analysis considers standard LMI measures of market conditions. This assessment sets the stage by identifying the overall supply/demand balance in the labour market, unemployment, the impact of retirements in the trade and the extent to which recruiting can meet overall demands locally or from outside markets. Measures reported here are often critical to decisions about the number of apprenticeships. For example, the introduction of a major project could increase demand well above local supply for all qualified workers, driving training demands higher. Alternatively, an economic downturn might reduce demand and signal rising unemployment across all levels of qualifications. The second stage assesses the importance of apprenticeship programs in the labour market. A wide range of outcomes can be anticipated here. There are trades where journeypersons are a large proportion of the workforce and provide technical expertise, as well as filling management and supervisory roles. Apprenticeship programs are critical for providing the future labour force and for managing labour market conditions in these trades. In contrast, there are trades where there is less demand for journeyperson certification and apprentices play a smaller role in providing the future supply of workers. There are limits to the effectiveness of apprenticeship-based solutions to market imbalances in these trades. The Provincial Occupational Modelling System (POMS), the LMI system used here, includes detailed assessments of labour markets for all trades and characterizes the conditions using three categories:3 • Loose markets where unemployment is high or rising and employer requirements can be met from the local workforce. Job seekers may search in other markets. • Balanced markets show a rough equality of local requirements and the available workforce. Demographic conditions and retirement patterns, in particular, may require some recruiting in other markets and immigration is usually a factor. • Tight markets track high and rising requirements that cannot be met locally and lead employers to recruit in other markets. These conditions are usually associated with skill shortages, although there is no evidence in the standard LMI systems to indicate that workers with specific qualifications are in short supply. Standard LMI often projects limited shifts in supply and demand, reflecting markets largely in balance. While these balanced conditions may suggest limited recruiting challenges, conditions for specific qualifications in the workforce highlight potential gaps. 3 The Provincial Occupational Monitoring System is maintained by Stokes Economic Consulting and provides the detailed analysis of labour market conditions for the trades across Canada. A key measure used here is the number and proportion of journeypersons in each trade’s workforce. This measure was taken from the National Household Survey in 2011. A high number of journeypersons is one signal that the apprenticeship system will play a key role in the evolving labour market conditions described at the first stage. Each trade is situated across the high- to low-impact spectrum, changing the role of apprenticeship in the labour market. Many distinct conditions emerge. A limited role for apprenticeship may be associated with trades where there are new and growing programs and specializations. In this case, the impact of journeypersons might be expected to grow. In other trades, there may be a low or changing proportion of journeypersons in the workforce related to structural or technological changes. Employer preferences for journeypersons, apprenticeship and other qualifications were also gathered in a survey of 500 employers in 15 trades. Findings indicate employers attribute high importance to work experience in their hiring practices. Survey findings suggest preferences for journeyperson status (Certificate of Qualification), apprenticeship training, pre-apprenticeship and college vary by trade (See Figure 2). Where employer preferences for journeyperson qualifications appear out of line with the current mix of qualifications in the workforce, the analysis signals this imbalance and identifies impacts. Understanding Apprenticeship Requirements and Workforce Qualifications in the Canadian Labour Market 2.1 Stage 1 General Labour Market Conditions 6 FIGURE 2: Employer Hiring Preferences Strong employer commitment to apprenticeship and certification Electrician (except industrial and power system) Gasfitters Heavy Duty Equipment Mechanic Plumber Refrigeration and Air Conditioning Mechanic Sheet Metal Worker Employer commitment to certification and training is moderate Automotive Service Technicians, Truck and Bus Mechanics and Mechanical Repairers Carpenters Employers assign less value to certification and training Painters and Decorators (except interior decorators) Construction Millwright and Industrial Mechanics Cooks Heavy Equipment Operators (except crane) Machinist and Machining and Tooling Inspectors Machinists Steamfitters, Pipefitters and Sprinkler System Installers Welders and Related Machine Operators For the detailed employer survey findings, see “Apprenticeship and Trades Qualifications: Employer Hiring Preferences in the Skilled Trades.” 2.3 Stage 3 Profiles of Trade Qualifications The core of the analysis is an estimation of the requirements for and the available supply of journeypersons. Estimates are available for 174 principal trades in seven provinces. The research team gathered ten years of historical data for employment, apprenticeship registrations and completions, as well as the 2011 National Household Survey estimates of the proportion and number of journeypersons in the workforce. Completion rates needed to be calculated in a consistent way to make them viable within the tracking system. The advanced cohort proxy with a three-year moving average formula was used for consistency across provinces and trades.4 4 Although cohort studies are the most accurate way to calculate completion rates, the most recent results available deal with cohorts from the 1990’s and the tracking system required more up-to-date information. The researchers used a pseudo-cohort methodology to calculate rates that provide trade and provincial results over time using data from RAIS. The method is called the advanced cohort proxy with a three-year moving average. This methodology includes new registrants from multiple earlier years. It allows extra time (one or two years) for the apprentice to complete the program beyond the nominal duration. Although it is recognized the provinces and territories use different methodologies to calculate complete rates, a consistent methodology was required for this analysis. Labour market conditions for the journeyperson segment of the workforce are defined by a comparison of the annual change in labour requirements and the addition of newly completed and certified journeypersons (former apprentices). Labour requirements identify the number of additional journeypersons needed to meet changing conditions in each market. Requirements are defined by the annual change in employment and retirements in both the principle trade and related occupations. Changes to the available workforce of journeypersons are defined by the number of completing apprentices. This is, in turn, linked to the pattern of new registrations over the previous years. 7 This comparison of completions and requirements identifies shifting supply/demand balances for journeypersons. The shifting mix of qualifications and skills in the workforce can be related back to patterns of general labour market conditions, as well as the rise and fall of new registrations in apprenticeship programs. To simplify the analysis, one of three descriptions has been assigned to each trade qualification profile: • Skill Deepening refers to a five-year trend of completions exceeding requirements, increasing the overall proportion of journeypersons in the workforce. Skill deepening may indicate an industry intention to increase the skill level of its workforce or, alternatively, it may signal an oversupply of journeypersons. • Skill Balancing refers to a five-year trend of completions equalling requirements. While this condition may indicate good industry planning, it may also signal the continuation of a skills shortage. • Skill Weakening refers to a five-year period where completions fall short of requirements. This situation may be the result of a period of lower registrations or an unexpected increase in requirements. It could well signal a short-term or local disruption (e.g. limited training capacity) or long-term structural change (e.g. steady rise in retirements, drawing journeypersons out of the workforce). Each of the three descriptions offer a new level of insight into labour market conditions for the trades. Conditions can vary widely and have distinctly different implications for action by employers, trainers and apprenticeship system administrators. In general, apprenticeship stakeholders should be concerned when there is a skills weakening situation because completions will not meet the demand for skilled workers. When skills are balanced or deepening, there is less cause for concern as apprentices are meeting or, perhaps, exceeding demand. Understanding Apprenticeship Requirements and Workforce Qualifications in the Canadian Labour Market Annual change in requirements (demand) and completions (supply) can be volatile and related to shifting local conditions. Employers and trainers need time to recognize and adjust to trends. To reflect lagged response, the analysis compares five and ten year totals for requirements and completions. These longer-term balances are interpreted as shifts in the skill composition of the workforce. Extended periods when completions exceed requirements would add to the proportion of journeypersons in the workforce, increasing the depth of skills. Alternatively, a period marked by low completions would weaken the depth of skills. Ideally, labour force management practices and responsive systems would lead to a balance of completions and requirements over time. 8 3 Summary Information for Ten Trades FIGURE 3: The best way to develop an appreciation of the new approach is to consider specific examples. Ten trades were selected and an overview of the findings is presented in Figure 3. Summary Table for Ten Trades Trade General labour market information based on POMS modelling system Apprenticeship impact, includes trade designation (compulsory or voluntary) and employer preferences based on employer survey Projected conditions based on “Apprenticeship Tracking System,” includes skills balancing, weakening and deepening with implications for apprenticeship Balancing Auto Service Technician Alberta Balanced markets show a rough equality of local requirements and the available workforce. Demographic conditions and retirement patterns, in particular, may require some recruiting in other markets and immigration is usually a factor. High: Means apprenticeship training and certification are valued by employers in this trade and they seek candidates with some apprenticeship training or journeyperson status. Typically, trades in this category are compulsory. Weakening Implications for Apprenticeship Skill weakening: Refers to a five-year period where completions fall short of requirements. Apprenticeship stakeholders should be concerned that completions are on a downward trend in this trade when there is high demand for apprenticeship training and certification due to employment growth and retirements. Programs aimed at helping apprentices complete, such as targeted exam preparation, may be worthwhile considering completions are falling short of requirements. Carpenters – B.C. Balanced Medium: Indicates that employers value apprenticeship and work experience, but do not necessarily value certification. Trades in this category are usually voluntary. Employment growth and retirements indicate there is demand, but completions are projected to decline until 2018. Action to help more apprentices complete in this trade could help address shortages. Heavy Duty Equipment Mechanics Ontario High Registrations declined after the 2009 recession and, subsequently, completions lag to 2018, but employment growth and retirements are accelerating, indicating there may not be enough apprentices to meet demand. Balanced Employers in this trade value apprenticeship and journeyperson status when hiring, indicating there will be an ongoing demand for apprentices in this trade. Outreach to youth and parents about the future opportunities in this trade may be necessary to ensure supply meets demand. Supports to facilitate completion may also be necessary. 9 Projected conditions based on “Apprenticeship Tracking System,” includes skills balancing, weakening and deepening with implications for apprenticeship Balancing Painters and Decorators Ontario Electricians -Ontario Balanced Balanced Low: Less employer demand for apprenticeship training and certification. Trades in this category are voluntary. High Weakening Implications for Apprenticeship Registrations and completion rates are low. When hiring, employers in this trade do not value apprenticeship training and journeyperson status as much as other employers. To avoid skills shortages and facilitate skills development in this trade, employers may benefit from learning about the value of workplace learning and the business case for apprenticeship. Encouraging employers to invest in skills development will ensure there are skilled workers available to meet labour market demand. Skill balancing: Refers to a five-year trend of completions equalling requirements. Employers value apprenticeship training and journeyperson status in this trade, creating an ongoing demand for apprentices. At the moment, trade appears to be in balance. Although retirements are increasing, so are registrations and completions. Understanding Apprenticeship Requirements and Workforce Qualifications in the Canadian Labour Market Trade General labour market information based on POMS modelling system Apprenticeship impact, includes trade designation (compulsory or voluntary) and employer preferences based on employer survey 10 Trade Refrigeration and Air Conditioning Mechanics Alberta General labour market information based on POMS modelling system Balanced Apprenticeship impact, includes trades designation (compulsory or voluntary) and employer preferences based on employer survey High Projected conditions based on “Apprenticeship Tracking System,” includes skills balancing, weakening and deepening with implications for apprenticeship Deepening Implications for Apprenticeship Skill deepening: Refers to a five-year trend of completions exceeding requirements, increasing the overall proportion of journeypersons in the workforce. There is a strong preference for journeyperson status in this trade, indicating an ongoing demand for apprentices. At the moment, there appear to be sufficient numbers, with registration and completion figures rising. Apprentices in this trade will need to be prepared to cope with technological change and may require additional computer or problem-solving training to keep up with industry changes. Cooks - Atlantic Balanced Medium Registrations and completions have been rising and will stabilize at high levels. There is limited projected employment growth, indicating more certified cooks are not required unless demand for certification among employers increased. There may be opportunities to support labour mobility. Sheet Metal Workers Atlantic Balanced Medium Registrations and completion have reached peak levels and regional employment has slowed. Steam/Pipe Fitters – B.C. Balanced High Projects will drive employment up to 2015, but completion patterns should match gains, suggesting additional apprentices are not required at this time. Structural metal and Platework fabricators - BC Balanced High Registrations, completions and employment are stable. There may be opportunities to pursue work in other provinces and territories, depending on what projects move forward. Manufacturing recovery will require new skills in the workforce, so upgrading to cope with technological change may be required by apprentices and journeypersons. 11 This analysis supports new apprenticeship-focused, qualifications-based LMI. The tracking system has the capacity to assess conditions for a significant number of trades and provinces. Each trade assessment has three parts: • a review of general LMI, • an estimate of the impact of apprenticeship in the market and • a profile of trade qualifications. Together, these measures offer specific, new and valuable insights into the state of apprenticeship in these markets. They have important implications for employers, labour representatives, employers, educators and apprenticeship administrators who plan apprenticeship programs, share career information with youth and parents, implement completion initiatives and engage employers. Understanding Apprenticeship Requirements and Workforce Qualifications in the Canadian Labour Market 4 Conclusion 12 Appendix A –List of Principle Trades and Related Occupations List of Principle Trades Principle Trades 1 1522 Storekeepers and partspersons 2 2225 Landscape and horticulture technicians and specialists 3 2242 Electronic service technicians (household and business equipment) 4 2243 Industrial instrument technicians and mechanics 5 2282 User support technicians 6 4212 Social and community service workers 7 4214 Early childhood educators and assistants 8 6322 Cooks 9 6331 Butchers, meat cutters and fishmongers retail and wholesale 10 6332 Bakers 11 6341 Hairstylists and barbers 12 7231 Machinists and machining and tooling inspectors 13 7232 Tool and die makers 14 7233 Sheet metal workers 15 7234 Boilermakers 16 7235 Structural metal and platework fabricators and fitters 17 7236 Ironworkers 18 7237 Welders and related machine operators 19 7241 Electricians (except industrial and power system) BC AB ON NB NS NL PE 20 7242 Industrial electricians 21 7243 Power system electricians 22 7244 Electrical power line and cable workers 23 7245 Telecommunications line and cable workers 24 7251 Plumbers 26 7252 Steamfitters, pipefitters and sprinkler system installers 27 7253 Gasfitters 28 7271 Carpenters 29 7272 Cabinetmakers 13 Principle Trades BC AB ON NB NS NL PE 30 7281 Bricklayers 31 7282 Concrete finishers 32 7283 Tilesetters 33 7284 Plasterers, drywall installers and finishers and lathers 34 7291 Roofers and shinglers 35 7292 Glaziers 36 7293 Insulators 37 7294 Painters and decorators (except interior decorators) 38 7295 Floor covering installers 39 7311 Construction millwrights and industrial mechanics 40 7312 Heavy-duty equipment mechanics 41 7313 Refrigeration and air conditioning mechanics 42 7315 Aircraft mechanics and aircraft inspectors 43 7318 Elevator constructors and mechanics 15 16 44 7321 Automotive service technicians, truck and bus mechanics and mechanical repairers 45 7322 Motor vehicle body repairers 46 7331 Oil and solid fuel heating mechanics 47 7332 Appliance servicers and repairers 48 7333 Electrical mechanics 49 7334 Motorcycle, all-terrain vehicle and other related mechanics 50 7335 Other small engine and small equipment repairers 51 7371 Crane operators 52 7373 Water well drillers 53 7384 Other trades and related occupations, n.e.c. 54 7521 Heavy equipment operators (except crane) 55 7611 Construction trades helpers and labourers 56 9232 Petroleum, gas and chemical process operators 57 9241 Power engineers and power systems operators Total Source: Prism Economics 40 40 40 19 4 Understanding Apprenticeship Requirements and Workforce Qualifications in the Canadian Labour Market 14 List of Related Occupations Related Occupations 1 0131 Telecommunication carriers managers 2 0423 Managers in social, community and correctional services 3 0711 Construction managers 4 0712 Home building and renovation managers 5 0822 Managers in horticulture 6 1215 Supervisors, supply chain, tracking and scheduling co-ordination occupations 7 2223 Forestry technologists and technicians 8 2233 Industrial engineering and manufacturing technologists and technicians 9 2241 Electrical and electronics engineering technologists and technicians 10 2244 Aircraft instrument, electrical and avionics mechanics, technicians and inspectors 11 4021 College and other vocational instructors 12 4152 Social workers 13 4413 Elementary and secondary school teacher assistants 14 6321 Chefs 15 6562 Estheticians, electrologists and related occupations 16 6711 Food counter attendants, kitchen helpers and related support occupations 17 7201 Contractors and supervisors, machining, metal forming, shaping and erecting trades and related occupations 18 7202 Contractors and supervisors, electrical trades and telecommunications occupations 19 7203 Contractors and supervisors, pipefitting trades BC AB NB NS NL PE 15 20 7204 Contractors and supervisors, carpentry trades 21 7205 Contractors and supervisors, other construction trades, installers, repairers and servicers 22 7243 Power system electricians 23 7301 Contractors and supervisors, mechanic trades 24 7302 Contractors and supervisors, heavy equipment operator crews 25 7612 Other trades helpers and labourers 26 7621 Public works and maintenance labourers 27 8255 Contractors and supervisors, landscaping, grounds maintenance and horticulture services 28 8432 Nursery and greenhouse workers 29 9212 Supervisors, petroleum, gas and chemical processing and utilities 30 9221 Supervisors, motor vehicle assembling 31 9226 Supervisors, other mechanical and metal products manufacturing 32 9241 Power engineers and power systems operators 33 9416 Metalworking and forging machine operators 34 9461 Process control and machine operators, food, beverage and associated products processing 35 9462 Industrial butchers and meat cutters, poultry preparers and related workers 36 9521 Aircraft assemblers and aircraft assembly inspectors 37 9526 Mechanical assemblers and inspectors Total Source: Prism Economics BC 28 AB NB NS NL PE 16 11 9 11 3 Understanding Apprenticeship Requirements and Workforce Qualifications in the Canadian Labour Market Related Occupations NOTES caf-fca.org 404-2197 Riverside Drive Ottawa, ON K1H 7X3 (t) 613-235-4004 (f) 613-235-7117 info@caf-fca.org Scan code to download full report