IN 2007, Elise Ondet arrived in Toronto from France with her husband. She was highly educated with a Master’s degree in Political Science and International Economics and had a good grasp of English. Despite this, she ended up working in a retail job during her first six months in Toronto.
Thankfully, while networking, she met someone who worked at ACCES Employment, an Ontario skills training service provider. There, she entered a job search training program and learned the differences between the Canadian and French labour markets. Her sense of self-confidence was renewed in the process. In just five months, she landed a job as a social media specialist for a communications company. Elise is convinced she got the job faster due to the help she received from the employment centre. She fondly recalls the advice she received and considers the skills she gained indispensable to this day.
Ontario’s skills training programs
The Ministry for Advanced Education and Skills Development (MAESD) oversees and funds Ontario’s employment centres, like ACCES Employment. The funding for these centres is largely tied to the immediate outcomes of its clients – whether the client finds a job, goes into formal education, or receives further training after receiving assistance from the centre.
This incentive structure is problematic. It does not capture the intrinsic benefits, like increased confidence, knowledge, skills, or quality of service that Elise received. These are all crucial components to maintaining and excelling in any job, especially as the labour market changes. Further, it encourages employment centres to focus solely on placing clients into jobs. This is short-sighted with implications for service. It diminishes the value of training people into skill areas so they can manage their careers in the future. It would be wise to think that such clients would be less likely to need assistance later in life.
However, if funding was tied to these alternative indicators, service providers would be responsible for a more holistic service provision. The Institute believes this would create better services and better outcomes.
Skills training programs have to measure more than just job placement rates. They have to train people will skills they actually need.
Some of the programs under MAESD, such as Employment Service and Second Career, are also failing to adapt to the changing labour market and the needs of Ontarians. The Institute’s most recent Working Paper, The labour market shift: Training a highly skilled and resilient workforce in Ontario examined these two programs:
- Employment Service (ES): Intends to help Ontarians find sustainable employment by delivering career counselling support through a network of over 400 service provider agencies. ES agencies receive between $795 and $2,950 per assisted client. In 2015/16, close to 200,000 Ontarians used assisted Employment Service.
- Second Career (SC): Funds skills training for recently laid-off workers seeking employment in high-demand occupations. It provides up to $28,000 per client to assist with basic living expenses, tuition, books, and transportation. In 2015/16, over 8,000 individuals used Second Career. Some of them are new immigrants, like Elise, others are highly educated and unemployed individuals, laid off workers, older workers, and youth.
The programs have not kept up with the changing labour market
The Institute’s review of the programs reveal that they are not keeping up with the changing labour market and are failing to meet the needs of Ontarians.
Ineffective evaluation and funding structure
The evaluation and funding structure placed on ES and SC encourage a short-term focus over a long-term perspective by only capturing job placement rates on exit. With the pace of technological change, it is necessary to have skills that are transferable across occupations and professions, and so the structure must incentivize these aspects. It is not clear whether Ontario’s training programs are equipping clients with these types of skills.
These training programs have a difficult time taking into account the needs of employers. They are ‘supply driven’, meaning, they focus on the skills and qualifications an individual has, instead of understanding what employers need, and locating the right candidate to meet those needs. If the skills that the clients have are not the ones that employers are looking for, it will be hard for them to find, keep, and advance in a job, or be offered a job at all. A ‘demand-driven’ program, in contrast, would focus on the skills local employers need and create informed training programs that would allow clients to gain in-demand skills and access long-term, sustainable employment.
Risk of automation
ES and SC are not taking into account the potential risks of automation when advising Ontarians on job options. Fifty-six percent of total ES clients assisted in 2015/16 were employed into occupations that have a high or medium probability of automation in the next 10-20 years (See exhibit below). If the programs want to best meet the needs of Ontarians, there must be a way to integrate this vital information into the program design. Case managers at service locations must be equipped to advise clients on the best career path for them. If not, they risk creating a revolving door of clients.
A new funding and evaluation model is needed
MAESD should move to a performance measurement system and funding model that tracks sustainable employment, long-term client outcomes, and data on skills and knowledge clients gain during programming. The new structure could take into account long-term job retention rates and important non-job-related benefits that contribute to sustainable employment (such as increased confidence and improved digital literacy skills) and reward delivery agencies accordingly.
There should be a concerted effort to equip Case Managers with local labour market information and the ability to advise clients on the short-term and longer-term impact of automation on their chosen industry. Of course, MAESD should consult with key stakeholders in this area to determine the best approach for the system moving forward.
It is essential that our employment service providers take a holistic approach to training and skill development. Doing so will ensure Ontarians can remain skilled and resilient as the labour market shifts.