C anada’s Human Capital Challenge Strategic Capability Network Symposium: Diversity and the Bottom-Line April 28, 2006 Judith L. MacBride-King Principal MacBride-King and Associates Research and Advisory Services in Human Resources Management

Eight Mega-Issues Facing Canada Governance Global Economy Canada & U.S. Relationship Innovation Healthy Environment Competitive Cities Health Care Human Capital Source: The Conference Board of Canada

It’s All About People… The Skills Crunch: 2000 and 2002 Significant numbers of governments and private sector organizations reported experiencing skills shortages Both private sector firms and governments projected that the trend would continue - and intensify - especially for particular occupations Source: The Conference Board of Canada

Projected Skills Shortages (Governments) - 3 to 5 Years - Source: Judith L. MacBride-King, et al. Building Tomorrow’s Public Service Today: Challenges and Solutions in Recruitment and Retention, The Conference Board of Canada, 2002

Average Age of Executives/Managers/Supervisors (All Three Levels of Government) Source: Judith L. MacBride-King, et al. Building Tomorrow’s Public Service Today: Challenges and Solutions in Recruitment and Retention, The Conference Board of Canada, 2002

Retirement Woes If the age of which public servants across the country retire remains at current level.. governments project that by Dec. 31, 2010, a full 44 per cent are eligible to leave. Source: Judith L. MacBride et al, Building Tomorrow’s Public Service Today: Challenges and Solutions in Recruitment and Retention, The Conference Board of Canada, 2002

A Sampling of Occupations in High Demand Engineers IT project managers AccountantsComputer analysts Nurses & doctorsFirefighters Physical scientistsElectricians Heavy equipment operatorsWelders HR professionalsManagers Source: Various

Attracting and Retaining Talent: Trend Data % employers reporting difficulty attracting & retaining talent Source: The Conference Board of Canada

It’s Time For Your First…. QUIZ!

Attracting and Retaining Talent % employers reporting difficulty attracting & retaining talent Source: The Conference Board of Canada ?

Answer…. The pressure for talent is building – as predicted. Beginning in labour shortfalls will be more widespread. Employees are becoming a bit more footloose. The voluntary turnover rate in organizations is on the rise. % employers reporting difficulty attracting & retaining talent Source: Various publications, The Conference Board of Canada

Oil patch labour crisis seen spreading to rest of country Cities face off over talent India, China call expats back home Alberta Labour Shortage Draining Civil Service Skills crunch rivals tax cuts as top issue Nursing shortage more severe, urgent than expected Buttoned down and in demand… not enough accountants A Sampling of Recent Headlines… Oil patch labour crisis seen spreading to rest of country

BUT, It Is Not Just About People

Skills in “Need of Improvement” in Governments Across Canada Source: Judith L. MacBride et al, Building Tomorrow’s Public Service Today: Challenges and Solutions in Recruitment and Retention, The Conference Board of Canada, 2002

Things Haven’t Changed Much… Technical, professional, or job specific skills Leadership and management skills Computer skills Interpersonal and teamwork skills Problem solving skills Communication skills Basic skills such as literacy and numeracy Source: Canadian Labour and Business Centre (2005 Survey of Business and Labour Leaders)

What’s Driving the Skills Shortage… Ageing of the population Ever increasing global competition Rapid pace of economic, technological and scientific change

Demography Is Destiny: Canada’s Demographic Realities

Fertility rates going the wrong way for population replacement As a nation, we are getting older Other developed nations also “aging” – some at a faster pace than Canada Not only are we getting older, but there are more colours in our national demographic portrait.

Population Estimates for 1998 and Projections for 2006, 2016, 2026 Source: Statistics Canada

Median Age Estimates and Projections in OECD Countries Canada United States Japan Germany France Italy United Kingdom Czech Republic Greece Portugal Spain Source: United Nations Population Division, World Population Prospects: The 1998 Revision

Time For Your Second…. QUESTION

Whence Youth?

So, That is Our Challenge What must we do to meet the skills challenge?

What Must We Do? As a country we need to build a human capital strategy: Nurture, develop skills Recommit to/invest in education Recognize and leverage the competencies/skills we have (i.e., PLA) Remove barriers to labour mobility within Canada Tap into untapped or underutilized pools of labour Improve our ability to attract and keep talent from abroad (immigration)

Create a Compelling Brand

Immigration Remove barriers of entry into Canada Continue to ways to expedite the assessment of and recognition of foreign credentials and work experience Create a welcoming environment – improve settlement services Prepare the nation for even greater ethnocultural diversity

The Problem is…For Too Many We are Not Living Up to the Promise Immigrants are attracted to Canada by a promise… rewarding employment opportunities and a high quality of life for themselves and their families. The challenge is that it can take many years for newcomers to realize their dreams, and for some the prize remains elusive. According to one person in a CBoC focus group….

We are Not Living Up to the Promise “I had the feeling that I was good enough for immigration, but not good enough for Canadian employers…If Canada needs cab drivers, then Canada should get cab drivers, not professionals.”

Immigration is Seen as Being Important in Helping to Close the Skills Gap Yet….we in Canada and Canadian organizations continue to underutilize the skills and talents of immigrants. According to one Statistics Canada study, 6 in 10 immigrants did not work in the occupational field in which they had worked prior to arriving in Canada. For the immigrants in that study, two major hurdles to achieving the right occupation fit were: difficulty in transferring their qualifications lack of Canadian work experience.

Other Challenges for Immigrants According to CBoC Focus Group Participants Desire of managers to hire someone like themselves Scarcity of visible minorities in hiring roles, which may create bias in selection and promotion processes Language issues and an inability on the part of the hiring staff to look or hear beyond the applicant’s accent Unfamiliarity with the “Canadian way” Source: The Conference Board of Canada

Immigration will Continue to Play an Important Role in our Nation’s Success….

Natural IncreaseNet Migration Selected Years % 23% % 29% % 51% 2030*20% 80% * = Projections Components of Population Growth Source: Statistics Canada, The Conference Board of Canada 2051*0% 100%

Trends in Immigration Proportion of Immigrants Born in Europe and Asia by Period of Immigration % Source: Census 2001, Statistics Canada

Soon will no longer be a “minority” in many communities. Visible minority population growing at a rate five times faster than the Canadian population as a whole. Approximately 13 per cent of persons in the Canadian labour market and in the population are visible minorities. By 2016, visible minorities will constitute 18 per cent of the labour market and 20 per cent of the population. Visible Minorities in Canada

Immigration is Changing the Face of Canada Over 80 per cent of all visible minorities in Canada are immigrants In 2003, 73 per cent of all newcomers to Canada were visible minorities

Visible Minority Talent is Underutilized, Under-Appreciated We have labour shortages and yet... 1 in 5 visible minorities report experiencing discrimination and most of this occurs in employment-related situations (Statistics Canada) Visible minorities are under-represented in key decision-making positions Their earnings are roughly 15 per cent below the national average

What Must We Do? … Continued In organizations: Get serious about talent management – make it a strategic priority aligned with the business plan Make diversity a core part of an integrated TM strategy Tap into and retain untapped talent pools women visible minorities aboriginal peoples persons with disabilities older workers – men and women

What Must We Do? … Continued In organizations: Create inclusive work environments – identify and break down barriers to full participation and growth in workplaces (The time for talk is long past.) Rethink retirement and develop different forms of working relationships Invest in training and skills development – for employees of all ages Move beyond retention to engagement And, segment the population - focusing on what matters to them

The Diversity Advantage Organization Effectiveness Enhance creativity and decision making Expand business opportunities – national/ international Close labour force gaps Build stronger client relations The Diversity Advantage Enhance organization’s reputation

A Focus on Diversity Helps in Recruitment and Retention In CBoC studies over the years, women, youth and visible minorities have all indicated that they are attracted to organizations that are demonstrably supportive and respectful of diversity. People have choices – lots of them! Women and visible minorities in our work noted that they would leave/have left organizations that do not have a culture supportive of diversity.

For Example… In 2000, almost 5 in 10 women executives in one survey noted that “inhospitable” organizational culture had prompted them to leave organizations. (The Conference Board of Canada) The most prevalent reason given by women in the Ottawa Police Force who have considered leaving the Force is “frustration over harassment and limited opportunities” (Ottawa Citizen, Nov. 13/04)

Engaging Talent…What Does it Take? Organization Effectiveness Employee Outcomes Justice/Fairness Rewards Job Characteristics Organization Support Supervisor Support Employee Engagement Fit and Belonging Source: The Conference Board of Canada

A Focus on Diversity Helps in Engagement Consider the driver relating to “fairness and justice” In a recent study in the U.S., the most inclusive workplaces generated the most loyal employees. (Gallup) Among visible minorities in Conference Board focus groups, those who believed that their employers and managers were “fair” were less likely to perceive other barriers in the workplace. Employees whose leaders/managers display key competencies with respect to diversity are rewarded with engaged staff. (TWI Inc.)

A Focus on Diversity Acts a Magnet for Customers and Investors Customers and shareholders alike are becoming more selective in where they spend/invest their dollars. In one U.S. study, 40 per cent of households which included a person with a disability indicated that they would be “extremely likely” or “very likely” to switch brands to support a disability cause. What is more 32 per cent of households which had NO member with a disability would do the same thing.

A Focus on Diversity Acts a Magnet for Customers and Investors In Canada, the Ontario Municipal Employees’ Retirement System Pension Plan recently announced that it would apply social and environmental criteria to the plan’s share votes.

Diversity Contributes to Innovation and Decision-making It is unfortunate that attempts at cloning leaders still go on at a time when globalization and internationalization of the workforce make it possible for us to seek different leadership characteristics. Every time you seek to clone leaders, you will restrict your competitive edge. Conference Board Interview with Hubert de Pesquidoux CEO of Alcatel

Toward Organizational Change: Lessons Learned

Diversity must be embedded in the cultural DNA of the organization

Lesson One: Demonstrable Leadership and Commitment Count “Leaders must lead...” “Don’t ask employees or managers if they buy into the value of diversity. Tell them this is the way it is...and model it. Value diversity.” Source: Leaders’ Summit on Visible Minorities, May The Conference Board of Canada

What Does Demonstrable Leadership Look Like? Strong leaders… model desired behaviours and become personally involved in diversity have a propensity for action and they invest time and resources to achieve change hold themselves and others accountable for change.

Lesson Two: Education is Important – But It’s Not Enough “We thought that if we created awareness through an education process, managers would eventually do the right thing. That didn’t happen. We are now embarking on a completely different course that has targets, measurements and pretty tough reporting – the way line managers are typically used to reporting their business results.” Source: Interview with Human Resources Leader, Financial Services Industry, The Conference Board of Canada

It’s About Accountability for Change Develop internal accountability frameworks Develop supplier standards/accountability frameworks What gets measured – and rewarded and recognized – gets done.

Lesson Three: The Basics Matter Get serious about talent management – make it a strategic priority Develop a zero tolerance for discrimination, harassment Invest! Invest! Invest! Provide diversity training to managers and staff

Lesson Four: Experience Counts Learn from your past experiences in managing diversity (transfer lessons learned) Tap into current and prospective employees’ views on what is needed Connect with other employers and other groups

Some Specifics for Newcomers to Canada Provide career development programs that focus on the development of “soft skills”, such as communication and listening skills, as well as an understanding of how to “do things the Canadian way.” Programs could provide information on how to navigate organizational processes how to interact with colleagues and managers what it takes to be successful in Canadian organizations

Lesson Five: Building Capacity Goes Beyond the Organization Invest in the future – get involved in community efforts to support diversity. For example... Work with stakeholders to seek solutions regarding the recognition of foreign credentials Provide financial support to help build capacity among diverse communities Invest in programs to help visible minority youth and newcomers gain valuable Canadian work experience

Contact Information Judith L. MacBride-King Principal MacBride-King and Associates Tel: