Volume 1: Beyond the Horizon: Canada's Interests and Future in Aerospace – November 2012
Analysis and recommendations (continued)
Building the aerospace workforce
A competitive Canadian aerospace sector is founded in part on a well-educated workforce that includes highly skilled engineers, technicians, technologists, and production personnel. The need for such a workforce is not limited to the aerospace sector—it extends to the whole economy, which increasingly depends on a pool of young people committed to careers in science, technology, engineering, and mathematics (STEM). Because the aerospace sector is seen as exciting, and pays relatively well, its vitality and a growing STEM pool are, in a sense, mutually reinforcing.
"Skilled workers must become agile and take on business functions that they have never done, such as: lean manufacturing, design for Six Sigma, concurrent engineering practices, strategic planning, marketing and business development, program management, supply chain management, financial management, and human resources management. These capabilities, as well as 'soft skills', have become critical for managing large complex projects, forging international alliances, and conquering markets. Companies, particularly [small and medium-sized enterprises], are now faced with the challenge of learning how to manage new business activities, hiring and training people to carry them out, and performing with excellence on cost, quality and delivery while evolving to become the 'go-to' supplier for higher value-added products and services."
Currently, the Canadian aerospace industry enjoys a competitive edge thanks to a workforce known for its expertise and productivity, but this advantage is at risk. Given the demographics of the workforce, concerted efforts on the part of industry, academic institutions, unions, and governments are required to shore up the aerospace sector's skills base. Labour market forecasts indicate that specialized and experienced aerospace workers will be in short supply over the coming decades, particularly in engineering, technology, and supervisory occupations. Indeed, some aerospace firms report that they are already struggling with labour shortages.
[Translation] "Strategic talent is becoming increasingly mobile and contributing more and more to the economic prosperity of cities. The availability of these specialized workers is usually a key factor in aerospace firm investment decisions. In short, having available talent in large metropolitan centres is a first-rate asset in an economy that is based on knowledge and innovation.
"Competition for a skilled workforce has now become global, and includes countries which, like Canada, are facing demographic issues, as well as other countries like Brazil, Russia, India and China (BRIC), which are experiencing unbroken cycles of economic growth."
Montréal International, Keeping the Greater Montreal Aerospace Industry Attractive, submission to the Aerospace Review.
"The greatest recruitment and retention challenges identified by aerospace and space companies are in occupations and trades characterized as highly skilled, technically oriented and specialized."
Efforts to strengthen the aerospace skills base must focus not only on attracting young talent to the right fields of study, but also on continual up-skilling. Global realities that challenge the industry to constantly adjust to technological evolution, shifting market and regulatory demands, and new design and manufacturing methodologies mean that employees on the shop floor and in laboratories must always be learning and adapting. As noted in the Final Report of the People and Skills Working Group, "market success will be achieved by those firms who not only have access to a highly skilled and adaptable workforce, but who can also keep those skills relevant over the long term." Canada's international aerospace competitors are deploying public resources to ensure that their workforces have relevant skills and can respond quickly to change by, for example, funding customized training programs, providing training-related tax incentives, and offering grants for workforce up-skilling.
Finally, fostering and maintaining a skilled, adaptable aerospace workforce requires that up-to-date infrastructure be available at academic and research institutions.
Aerospace training and innovation hub in Germany
The new Bavarian International Campus Aerospace and Security (BICAS) was launched in 2012 at the European Aeronautic Defence and Space Company (EADS) site in Ottobrunn, Germany. At this unique facility—developed by EADS and six other founding partners with backing from the German state of Bavaria—universities and research institutions have merged to create an educational campus at an industrial site.
Ottobrunn is one of the main locations for EADS Innovation Works, the corporate research arm that reports to the EADS Corporate Technical Office. BICAS will be based on three "pillars": research projects; scientific equipment; and teaching and study programs. Initial project funding of €20 million (about $26 million) has been pledged by Bavaria, matched by private investors and industry, which will ensure sustained activity at the campus for the next five years.
Many of these issues are relevant not just to the aerospace industry, but also to space companies and other sectors that rely on innovation and engage in advanced manufacturing. The primary responsibility for responding to them rests with industry—given its fundamental business imperatives—and provincial governments—given their jurisdiction over education. But the federal government also has a role to play. Vibrant, innovative companies with well-educated, highly skilled workforces provide economic benefits to the country as a whole and are part of building a strong economic union. Through Human Resources and Skills Development Canada, NSERC, Citizenship and Immigration Canada, the Canada Foundation for Innovation, and the tax system, the federal government delivers programs and funding to support skills development, nurture Canadian talent, and address persistent skills shortages. While these programs do not typically target specific sectors, with more focus, they can be better leveraged to maintain and enhance the competitiveness of Canada's aerospace workforce.
"A talented and adaptable workforce is at the heart of innovative economies. Every part of the economy therefore has a stake in educating, training and effectively integrating highly qualified and skilled Canadians into the workforce, and in attracting and retaining talented individuals to Canada. While the development of talent is the responsibility of the provinces, the Government of Canada plays an important role through the granting councils and can have a particular focus on the deployment of talent in support of business innovation."
Innovation Canada: A Call to Action, October 17, 2011, p. 5-14.
Recommendation 15: Promotion of aerospace- and space-related studies and workplace experience
The aerospace and space sectors offer a world of possibilities to young Canadians. With creative and engaging outreach programs, students at the elementary and secondary levels can be awakened to career opportunities in aerospace and space, and given an appreciation of the training—including courses in science and math—that they must follow in order to realize their dreams. And when these students reach the post-secondary level and enrol in aerospace-related studies, their success can be facilitated through workplace experience and bridging programs.
The federal government cannot make these things happen on its own. But it can and should work with industry, academic institutions, and provincial governments to understand the human capital needs of the aerospace sector and to deal with potential labour force shortages that, if left unaddressed, will affect the sector's long-term competitiveness.
Taking the long-term view, collaborative initiatives should seek, in the first instance, to boost STEM program enrolment and completion rates and to inform youth about aerospace and space career options. Particular efforts should be made to encourage the participation in STEM and aerospace- and space-related studies of young women—who are under-represented in these areas—and Aboriginal youth—who are a growing proportion of the population and who sometimes face challenges with labour market integration.
Governments, industry, unions, and academia should also cooperate in efforts to help students in engineering and trade school programs acquire hands-on experience in the aerospace and space sectors through internships, applied research projects, co-ops, and flexible apprenticeships. Federal contributions to these efforts should include:
- more focused support for undergraduate-level internships in aerospace and space companies, which will accelerate the progress of engineering students and make them more work-ready upon graduation; and
- targeting programs toward strengthening the skilled trade base for aerospace and space by supporting relevant co-ops, flexible apprenticeships, and bridging from post-secondary studies into workplaces.
In the event the sorts of concerted, coordinated efforts described above do not result in a skilled labour force large enough to meet the aerospace and space industries' needs, the federal government should be responsive to companies' requests to use the immigration system—including recently announced changes to facilitate the immigration of skilled tradespersons and professionals—to deal with demonstrated shortages.
Recommendation 16: Support for up-skilling
Aerospace companies and their workforces must continually adapt to changing technologies, products, and regulatory requirements to remain competitive. Firms at the OEM and tier 1 levels already invest substantial sums in ongoing skills upgrading, sometimes assigning dedicated teams to develop in-house training programs. Tier 2 and 3 companies, particularly smaller ones, have less capacity to invest in learning and adapt to pressures, which is one impetus behind the supplier development programs discussed in recommendation 12.
Given that continual up-skilling is critical to the long-term vibrancy of the aerospace sector and, in turn, for the economy—and the reality that a capable, adaptable workforce is a key reason why aerospace firms choose to locate and remain in Canada—it is appropriate for public policies and programs to recognize and incent it, something they do not generally do at present. For a modern, innovation-based, globalized industry, a more inclusive approach is needed.
Such support could take a number of forms, including:
- Funding or tax credits for supplier development activities that transfer skills to workers across the supply chain, as risk is pushed down the tiers.
- Training grants to employers that partner with educational institutions to develop customized training programs that help employees work with new technologies and products.
- Targeted tax support in recognition of employers' investments in enrolling workers in accredited courses in fields such as manufacturing or transportation technology. This would go beyond the general deduction for business expenses and be aimed at strengthening the skilled trades base in Canada.
Measures such as these could be paid for from budgets for existing skills development programs and/or reallocation of savings resulting from the tightening of SR&ED eligibility criteria.
Recommendation 17: Co-funded infrastructure
Both initial skills training through post-secondary studies and ongoing up-skilling for the aerospace workforce require access to up-to-date training infrastructure, such as simulators and engines. This infrastructure costs a great deal to buy and maintain. But when aerospace research and training infrastructure is allowed to get outdated, the impacts on skills development and innovation can be serious.
Wherever possible, such infrastructure should be located in "hubs" that are accessible to a wide range of companies, researchers, and students. Given the level of aerospace activity in Montreal and Toronto, they would be among the most obvious places to create or nurture such hubs.
Some of the federal government's regional development agencies may be in a position to provide support for infrastructure-related partnerships between industry and academic and research institutions, where those partnerships stimulate economic growth and prosperity. Another source of funding may be the Canada Foundation for Innovation, which has a mandate to fund state-of-the-art equipment, laboratories, and other infrastructure in cooperation with universities, colleges, and research institutions. Finally, the NRC could be a participant in hub development, given its significant role in aerospace research.
Aerospace training and research hubs
An aerospace training and research "hub" brings together colleges, universities, firms, and government-supported research and technology transfer centres that are situated in proximity to one another, to work collaboratively to develop relevant skills and nurture innovation. For example, in Quebec, the École nationale d'aérotechnique and the Centre Technologique en Aérospatiale—which features state-of-the-art laboratories and equipment—are among those that collaborate closely with industry and universities within the Montreal aerospace cluster.
In keeping with the aerospace training and research hub model seen elsewhere in Canada and globally, a new aerospace campus is being proposed in Ontario. The campus would involve, among others, Centennial College, the University of Toronto's Institute for Aerospace Studies, and Bombardier. As noted in one submission to the Aerospace Review, the proposed campus would serve a number of purposes:
"One of the significant constraints to industry growth identified is an aging workforce and skilled labour shortage. One proposal to address this challenge, for which there [is] significant support, [is] to establish an aerospace campus at the Downsview Park site. This would leverage Ontario's very best educational institutions in a unique partnership designed to develop innovative new technologies, aid in workforce training and skills development, and participate in supply chain development activities. This campus would provide an anchor point to a proposed aerospace technology corridor between Toronto and Montréal and enhance the capabilities of both centres."