Tourism labour shortage could reach 350,000 employees in 2025

November 18 2008

That was the message delegates at the recent Tourism Leadership Summit heard when the Conference Board of Canada presented the results of the CTHRC’s first-ever tourism labour supply-demand forecast model.

While slower than recent years, the demand for Canadian tourism goods & services will continue to grow as more people gain the ability to travel. However, due to low population growth and changes in labour force participation, there will not be enough labour supply to satisfy this growing demand. In fact, a survey of tourism businesses indicates that 89% agree there is currently a labour shortage in the tourism sector. Furthermore, 68% of respondents perceive their greatest labour challenge as a “shortage of qualified, reliable employees”, especially in guest service, entry-level, and front-line occupations.

Tourism stakeholders are already experiencing negative impacts as a result of the existing labour shortage. Most notable are the loss of business revenue and deterioriating service levels, as well as the need to raise wages. However, raising relative wages is not the panacea to this challenge. While it would stimulate the supply of labour, it would also lead to higher prices, curbing demand. Specifically, it is estimated that raising wages would increase the supply of labour only enough to fill 62,000 jobs.

The strategy instead is to increase productivity and augment labour supply. Businesses should look to human resource practices that create and retain more productive employees, technologies that reduce labour demand, and further refinements to tourism product offerings to reduce the demand for labour without sacrificing product demand or service expectations. To complement enhanced immigration policies, labour supply can also be increased by targetting older workers and tailoring jobs to their specific needs, and by increasing incentives for other under-represented labour pools to work in the tourism sector.

The time to act is now.

Loading, please wait...