Economic boom brings a labour shortage to Newfoundland

The archetypal “have not” province is bringing in foreign workers to help fill jobs

To have and have not

Vale Archive

There may be no more surefire sign of an economic boom in Canada than a shortage of staff at the local Tim Hortons. It happened in northern Alberta when Fort McMurray exploded with oil sands-related activity. And now it’s happening in Deer Lake, in western Newfoundland. “We’re in the midst of a period of poor availability,” says local Tim Hortons’ owner Oral Clarke. He plans to bring in foreign workers from the Philippines to fill out his staff.

For a town of 5,000 that sits at a highway interchange near the entrance to Gros Morne National Park—never mind in a province with the highest unemployment rate in the country at 13.1 per cent—this may seem like a strange conundrum. But it’s indicative of a growing problem on the Rock. After decades of being Canada’s archetypal “have not” province, Newfoundland and Labrador is experiencing an unprecedented economic boom. And the record expansion brings an unfamiliar problem: an acute shortage of labour. “For years we’ve had people leaving the province because of too few jobs,” says Richard Alexander, executive director of the Newfoundland and Labrador Employers’ Council. “All of a sudden there’s been a switch and we’re entering an area where we have excess jobs and too few people to fill those jobs.”

More than $43 billion is pouring into major development projects across the province. Among the most prominent are the $8.3-billion Hebron offshore oil platform, the $3-billion Long Harbour nickel processing plant, and the $6.2-billion Muskrat Falls Lower Churchill hydroelectric project. The government surplus—once a rare figure on provincial balance sheets—climbed far beyond expectations to $755 million last year, thanks mostly to oil revenues, says Memorial University economist Wade Locke. In a report titled “ Outlook 2020,” the province estimated that 77,000 job vacancies will open up over the next eight years (with more projects announced since the report, that estimate is widely perceived to be conservative).

The government is warning that the labour shortage could even dampen economic growth, and many expect it to get worse as more development projects get under way. One-quarter of the workforce will be older than 65 by 2020, according to the “Outlook” report. Meanwhile, thousands of younger skilled workers relocated elsewhere in search of jobs in the years before the economic boom. “We have about 20,000 people who commute to other places to work,” says Lana Payne, president of the Newfoundland and Labrador Federation of Labour. “For the first time, employers are really having to look at what they have to do to attract skilled workers to the province,” she says.

One such employer is Vale, the Brazil-based mining giant behind the construction of an extensive nickel processing plant at Long Harbour on Newfoundland’s west coast in southeastern Newfoundland. With some 2,000 workers currently on site, the company needs another 1,500 skilled labourers by next summer, primarily ironworkers and pipefitters, says project director Rinaldo Stefan. In order to compete for labour with similar job sites in Alberta and Saskatchewan, Vale spent “significant” sums of money on a cross-country advertising campaign last fall. Stefan says the labour shortage could delay the multi-billion-dollar project from being completed by its proposed end-date in 2013. “We will hopefully be able to fill most positions, but it’s obviously a high risk for us,” he says. Stefan adds that Vale might bring in foreign workers to address the shortage.

Alexander of the Employers’ Council feels foreign workers will be necessary to address the shortage. But he also talks about “underutilized” workers in the province, which he defines as people who are avoiding work to draw Employment Insurance. Pointing to a survey that found 41 per cent of businesses in Newfoundland have had people turn down job offers to remain on EI, Alexander contends this represents a major inefficiency in the provincial economy. “In some cases businesses are actually competing with the EI system for labour, and that’s not right,” he says.

Locke predicts that forces put in motion by the economic boom will increase wages and begin attracting workers back to Newfoundland, gradually resolving the skilled labour shortage. Small businesses are already feeling the pinch of wage inflation, and seasonal industries like the fishery continue to shrink. The province of yore is morphing into something else, he says: a dynamic modern economy—even if it’s sometimes tough to find people to pour coffee.


Economic boom brings a labour shortage to Newfoundland

  1. When did they move Long Harbour to the west coast? Must have been written by a CFA.

    • Thank you for making the correction.
      However, how can Macleans expect to capture a story about the labour market in Newfoundland by using a reporter based far away whose latests story titles are:
      “Romney Expected to take Florida”,
      “Canada to Palestine: forget UN statehood bid”,
      “The NFL links arms with BCE in CRTC rumble”,
      “Whos in charge in Attawapiskat?”, and
      “Julian Assange hacks his way into pop culture”?

      Are reporters in Newfoundland in short supply too??

  2. NL hasn’t been a have-not province since before Danny Williams left office. Another mediocre Canadian journalist from a mediocre Canadian publican trying to play up an outdated stereotype. Unfortunately Canadians have this curious manner of always trying to build themselves up by tearing others down. Must be the side-effects of an inate festering inferiority complex.

    • Well, we did have decades of being a have-not province with a constant out-migration of people in search of work; it’s why I’ve been in Ontario for the past 20 years. And while NL has been a “have” province for a few years, the labour shortage is a bit more recent. Maybe it’s not the reporter who has the complex?

    • You said “Unfortunately Canadians have this curious manner of always trying to build themselves up by tearing others down.”… That makes no sense at all, people from Newfoundland and Labrador ARE Canadians.

  3. At first glance it doesn’t speak well for the people of my birth province (well, of those not working anyway) when with such a high unemployment rate they have a hard time filling jobs. But some of it may be wage-related; people are seldom going to give up higher EI premiums from a good job to take a minimum-wage position; they’d rather keep looking for one with decent pay.

    That said, I have relatives in NL with businesses who say it’s hard to get quality employees for entry-level positions; I won’t repeat their theories because I go back for visits. :-)

    There is definite truth to the need to import skilled labour, and it’s because after decades with insufficient work many were forced to move away. The skilled workers who stayed already have jobs.

    The father of one of my coworkers started working on the Long Harbour plant just after the new year; he had just wrapped up a contract in BC. I have a good job and ties in Ontario, but if I were unemployed, I’d certainly be looking east…

  4. “But he also talks about “underutilized” workers in the province, which he defines as people who are avoiding work to draw Employment Insurance. Pointing to a survey that found 41 per cent of businesses in Newfoundland have had people turn down job offers to remain on EI, Alexander contends this represents a major inefficiency in the provincial economy.”
    I wish this weren’t true, but it is. Reliance on EI, choosing not to work, is a shameful social blight, and it needs to (be) change(d). This attitude, that being paid to do nothing for more than half the year is some kind of untouchable entitlement, is a disgrace. Utterly indefensible.

  5. If you are considering Vale as an employer, check out how they treat their workforce in Sudbury.

  6. Importing foreign workers when the pogey is at 13% my go you are a bunch of newfies aren’t you.

    A bit if the first nations running through your blood, wouldn’t want to work if I can get paid to sit around the house and long for the days I fished for a living!!

    • I was born & raised in NL but lived most of my life in Ontario. At the age of 48 my father moved his family of 6 to Ontario so there were more opportunties for them. It was a good move because all of us have had successful careers including my two brothers who moved back there when they got married. I take exception to your comments. I have a very large extended family in NL and they’re all hard working & successful people. Like my father a lot of people leave NL for other parts of Canada because there is no work. That’s the reason there’s a shortage of labour not because people don’t want to work.

      • BS.

        People do not want to work, otherwise there would not be a 13.9% unemployment rate and the province needing to import workers.

        The welfare and EI cheques have become an ongoing source of income for too many people who find it easier to work for a few weeks in a fish plant then get cheques form the government.

        I am sure that there are a lot of hard working people in NL but obviously there are a lot of slackers as well.

        • Its not that we don’t want to work, when over half of our population is older, they kinda can’t work! Then we got those few who are up to age to work, some choose not too like EVERY other province but our people work, and if it wasn’t for us, Alberta would be a shit show right now so I’d advice you keep your negative comments to yourself..

        • Ugh…I rarely take part in any discussion on any forum since they just seem to ever serve the purpose of breeding hatred and animosity, but I have to speak. Ken I’m honestly not here to insult you but please…you speak of and offer insults on things you do not fully understand. For the handful of Newfoundlanders that have abused the system, thousands boarded up or sold for next to nothing their homes…that they had worked there entire lives to own…my family being one of them… and left the Island with absolutely nothing. (only a fraction of those were fisherman). At a time and age that you are retiring…the life they built, everything they had worked just as hard as you have for…was suddenly worth nothing…they had to start over. These people deserve your respect not your judgment. Some people are so quick to judge an entire province of GOOD people on the actions of a few.

          Maybe you are right to feel justified to be ignorant and call lazy those that have been on social assistance…it can’t be denied there has been an abuse of it…and those that remain in there homes in isolated outport communities…maybe they shouldn’t hang on to a life that’s now gone and homes in place where there isn’t enough work to survive…(13.9% is it?) who knows maybe you are right and they should board up there houses like everyone else and in there late 50’s-60’s move to a place where they can work.. (maybe go to school at 60 and get there journeyman electrician certificate) I do agree with you that government assistance is not the answer and abuse of it is just wrong…but I for one do not presume to know what the answer is since they are all a tragic and unhappy one…and please know that not all who choose to stay in out port communities are by any means lazy or spongers and on government assistance. I’m not about to insult the good for the sake of reaching the few that might deserve it.
          I think it is an equal tragedy to see many older NL couple’s renting low income 1 bdrm apts in large cities all across Canada where they have no chance of retirement while the home they worked a good part of their life to own sits boarded up rotting on some lonely shore. But I guess that’s the unfortunate world we live in. It breaks by heart what happened in Newfoundland. After generations of humble ocean loving people fishing and surviving on the beautiful waters of NL It only took one generation with their trawlers, lack of knowledge and greed (not just NL’s but from all over the world fishing the waters of the Grand Banks) to cause so much damage to the ocean and the lives of so many…Anyhow…I this may not be answered in a positive manner…but as someone who personally lived it how could I not stand up for a province and people I love and respect???…It would be nice to see some kindness directed at the people of Newfoundland for a change…

          • Maybe the jobs available are for trades that locally people are not qualified for and that’s why they are recruiting abroad For now the current jobs available do not solve the immediate unemployment problem. Hopefully these jobs being filled will create more opportunity for unemployed residents in the near future.

  7. ken in nb. When was the last time you worked?

    • I last had to work 4 years ago when I retired at the age of 43.

      Hard work from the age of 12 and not making any stupid decisions paved the way for paying for my own future. Well that and real good timing on buying and selling my last house:)

  8. I just sufed the web to see what jobs there were as i am a class A red seal certified electrician mostly what i found was offers for training or for foreners to apply.
    The hrdc (canadian job bank was down) but i did not find much for job offers in this area why do these employers cry there is no local labour when they don,t even post offers.
    I would also like to add that the playing field is not equal when selecting local and foreign workers a local has to earn and pass a red seal where a forener is given a red seal because they deemed what they did in ther contry was equivalent.
    when a local applys for a job posting it will take minimum six months to start work if successfull.
    heres why– application accepted 4wks, personal interview 2wks, medical 3wks if all passed could be another 2-3 weeks for call to start work, Not sure what happens if job fails after you start but ei does not last long and if you had to relocate this is very costly,
    most employers hide the wage rate until you have been selected this is very important if you have to relocate.
    this may be why people wait for local employment while on ei.

    • You’d be supprised the number of people I see bumming smokes and can’t see the Help Wanted sign. Street trash on welfare has to end. Criminals on welfare has to end. It was set up to help those that could not, not those who don’t want.

  9. I still live here. Learning how to scam the system seems to be a “right of passage” in Newfoundland. Even wealthy are in on the scam. I mean, have a look at Port de Grave. A majority of them collect EI yet they live in mansions. There’s something wrong when wealthy people collect EI and limit the amount available for people who actually need it. The EI program would save money if government employees found jobs for applicants instead of relying on EI recipients. And if they can’t maintain any job given to them then they don’t get funding. To many people work yet scam the system to get EI to pay for new homes, new trucks, new toys and TVs. It’s ridiculous.  

    • That’s the Liberal way for most. They don’t need a job paying min wage and expects you to work when the can get welfare and bum/steal the rest.

  10. Newfoundland…Alex you got that right. That’s Good
    To have and have not…also that’s good.
    Sub heading…The Rock….not so good.  In fact down right pejorative and demeaning. I noticed that you interspersed the word the’ Rock’ throughout the article.  What is it with you people that you have to refer to our province as ‘the Rock’?  Perhaps we make you feel inferior, after all for such a small population of approximately 500thousand, we are brilliant.  Pomposity and lack of respect is evident by the constant referral to this place as the Rock, done mostly by media types to one of Canada’s beautiful provinces.   Yes, some of our people refer to their homeland as the Rock, but they know not what they say. They use other perjorative terms for the place and the people and only succeed in showing their lack of intellect. That’s why they move to the mainland of Canada.  Whenever one of these people moves away our province’s  IQ goes up and so does the IQ of the place they move to.  How’s that for a theory?  Show some respect for all Canadians, of which we are only a very small group.  It’s Newfoundland and Labrador, or like BC and PEI, it’s NL not The Rock.

  11. There are no jobs in Newfoundland! With 50% unemployment, how can there be a labor shortage? I would think that one of the 50% unemployed, would have no problem, filling some of the shortage, no? There is 50% unemployment in the place, because the bank that I work for, funds their horrid debt and deficit!!!

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