Managing Diversity – A competitive advantage

The aging of the Canadian population is creating numerous challenges for governments and for employers.  The lower birth rate of Canadian couples and the retirement of the baby boomers will combine to create a labour shortage that is not easily fixed.  In fact, a recent study (December 2008) by Dr. McNiven of the Atlantic Institute for Market Studies(AIMS) projected a labour shortage for Nova Scotia by 2015 and an overall labour shortage greater than 300,000 in Ontario alone by 2025.  Arguably, the current recession makes it difficult to imagine a situation where the demand for labour exceeds the supply of workers.  It  will eventually happen, perhaps a few years later, because the overall dynamics of low birth rate and baby boomer retirements will persist.  Baby boomers may be enticed to remain in the workforce a little longer due to the current economic conditions, but the birth rate is not likely to change.   Consequently, employers could face a situation where one in eight jobs may be vacant for lack of staff.  AIMS has proposed three broad solutions to solve the labour gap: find more people; increase labour productivity; and increase the labour force participation rate.  AIMS argues quite correctly that a combination of these three recommendations will offer the best chances to fill our labour gaps.



The three solutions proposed by the AIMS’ report will require a rethinking of the Human Resource management practices of employers, especially where immigrants are concerned.  Finding more people means that Canada has to become a country of choice for immigrants.   This is especially important if we are to reach our immigration targets.  Incidentally, the Conference Board of Canada estimates that Canada will require to increase its immigration levels by at least 60,000 annually after 2011 to over 300,000 immigrants per year to fill our labour shortages.  When these immigrants arrive in Canada, they must be able to find a job and become active participants in the economy.  The jobs will be there….but will their credentials, education, and training be recognised?  Having highly skilled people performing tasks or jobs where they are overqualified is a misallocation of labour.  From the perspective of the economy, these people are underemployed.   What kind of signals does this situation send to other highly skilled immigrants?  Finally, how many skilled immigrants are already here but not participating in the labour force because they were underemployed, not welcomed, unappreciated, or can’t face another rejection?  If we quickly learn to capitalise on the skills, talents, and education of new immigrants, we can all benefit.



Successful companies have long recognised the value and the contribution of a diverse workforce.  They have moved beyond employment equity, quotas, or affirmative action programs to embrace diversity.  They have adopted diversity management practices and have recognised that it provided them with a competitive advantage.  As the population of Canada continues to change and become more diverse, those companies that have made diversity management a cornerstone of their Human Resources management practices will thrive.  Meanwhile, their traditional competitors will be understaffed and wonder why they can’t attract good employees. 


HR pros can help clients with diversity training and the development of diversity management practices.

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