According to a new national survey conducted by Canadian Manufacturers & Exporters (CME), a lack of skilled workers is preventing Canadian manufacturers from adopting the necessary technologies to scale and compete globally.
Manufacturers are looking to technology to boost profits as the business landscape becomes more complex and competitive, but they are hindered by ongoing skill shortages, high purchase costs, and the ability to finance these new innovations.
One-third of manufacturers said that one of the biggest obstacles to using technology was a lack of skilled workers because they couldn’t find enough of them to use the technologies.
The survey, which was conducted between March 15 and April 17, 2023, also reveals that two out of every five businesses have either not started digital transformation yet or are in the early stages of it. More manufacturers will need to adopt digital transformation more quickly if Canada’s manufacturing sector is to remain globally competitive.
In addition, the survey reveals that 10% of businesses have yet to adopt any of the nine advanced manufacturing technologies frequently associated with Industry 4.0, such as cloud computing, robotics, and cybersecurity, and that one in four businesses are not currently utilizing any of the nine digital transformation software solutions that are available on the market, such as enterprise resource planning (ERP) systems.
It also discovered that, in comparison to their larger counterparts, smaller manufacturers face greater obstacles to technology adoption. Companies with fewer than 100 employees reported having greater difficulty obtaining digital transformation financing and having less confidence in their knowledge of advanced technologies.
According to Dennis Darby, President and CEO of CME, “More than 90% of Canadian manufacturers are small businesses and play a crucial role in the supply chain of larger companies.” To help accelerate technology adoption in our manufacturing sector, we require more targeted government support for these businesses or risk losing our economic competitiveness and standard of living.
In order to accelerate technology adoption, CME is urging governments to take three specific actions:
- Introduce a national 10 per cent investment tax credit that is matched by all provinces to help reduce costs and de-risk investments.
- Support employer-led training through a 50 per cent tax credit to offset half of the costs of employee training.
- Fund technology demonstration tours and site visits to help companies understand the opportunities with the new technologies.
Darby went on to say, “There is no doubt that technology adoption is crucial to meeting the challenges of intensifying global competition and an aging population, but Canadian manufacturers face many barriers that prevent them from taking full advantage of these solutions.” Canada runs the risk of falling further behind on the global stage if this does not change.
