Canadian Manufacturing

Automation not an ‘imminent threat’ to Canadian job market, C.D. Howe says

The Toronto-based think tank says industries at high risk of automation make up just 1.7 per cent of the Canadian workforce, sharply lower than other sources that put the figure at about 40 per cent



Automation has already had a far-reaching impact on the manufacturing industry. Technological advancements are expected to bring major changes to a number of other industries over the coming decade

TORONTO—Canadian policymakers shouldn’t be reaching for the panic button just yet.

Despite “alarmist” claims that a large portion of Canadians may soon be unemployed—replaced by robotic workers—a new C.D. Howe Institute report says automation is unlikely to cause widespread workforce disruptions in the near future.

“We find no evidence of an imminent threat of massive unemployment due to automation,” Rosalie Wyonch, one of the report’s authors, said in a statement.

“The automation of job tasks is part of the natural process of technological innovation and a necessary engine of economic growth,” she added. “The challenge for policymakers is creating a policy environment that cushions displaced workers and develops in-demand workforce skills.”

According to the report, just 1.7 percent of the Canadian workforce, or about 310,000 people, are employed in industries with a high risk of automation. On the other side of the spectrum, 27.5 per cent of workers, or about 4.9 million, are in fields with a low risk of automation.

The report stands in stark contrast to a number of other recent findings, including a report last year from Brookfield Institute for Innovation + Entrepreneurship at Ryerson University, which found 42 per cent of Canadian jobs could be at risk over the next 10 to 20 years. Federal government advisor and McKinsey & Co. chief Dominic Barton also recently warned about the impact of automation. He said last month that 40 per cent of jobs could disappear over the next decade.

Though the C.D. Howe report acknowledges some industries and jobs are particularly vulnerable, it expects the workforce to adapt.

“New technology does not simply make people redundant; rather, it reduces the labour required for a given level of production,” said Matthias Oschinski, another of the report’s authors. “This means that more of the same goods can be produced or people can be redeployed in areas that otherwise might not have been developed.”

The report found that current labour market trends highlight a gradual shift to jobs that require higher skill levels. It noted that the process is already underway and should be encouraged by public and private institutions.

You can access the report here.

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