A Just Transition for Workers Due to Canada’s Energy Sector Transition
According to a recent report from TD Bank, between 312,000 and 450,000 workers directly or indirectly employed by Canada’s oil & gas sector are at risk of job loss due to Canada’s climate change policy from now to the year 2050. This is expected to occur due to reduced fossil fuel demand making it possible to achieve net zero emissions by 2050 in Canada, the US other countries. This will make it possible to achieve our climate emissions commitments and keep warming below dangerous levels. However, we cannot forget oil & gas sector workers as we make this transition to clean, non-emitting energy sources. Forgetting these workers and their future career prospects will result in the need to pay out a significant amount of government supports to workers who cannot find suitable work, the collapse of the tax and revenue base for entire communities, and ghost towns. Research has indicated that Canadian fossil fuel workers who have lost their jobs have had to accept significant declines in income. The bottom 50% of oil & gas workers aged 25 to 49 displaced between 2009 and 2011 had to experience a 17.3% decline in income a year after the job loss. This figure was 65.1% for the bottom 25% of workers in this category. We need to make sure we get the transition away from the fossil fuel sector correct to avoid these losses in income and also make sure there are jobs available for displaced workers all while fighting climate change at the same time.
Canada’s Current Transition Plan For Fossil Fuel Sector Workers
The Canadian government recently released a discussion paper, entitled “People-Centred Just Transition”, outlining a proposed strategy to transition fossil fuel workers away from the fossil fuel sector. The strategy emphasized transitioning these workers to “decent, fair and high-value work designed in line with regional circumstances and recognizing differing needs”. The just transition outline also states the need for an inclusive transition and international cooperation to ensure a net-zero emissions future for all people. The discussion paper states the existing approach taken by the federal government to help train current fossil fuel workers so that they have the skills to be employed in a green economy. This includes 500,000 new training and work opportunities for Canadians to access training in sectors where there is a high demand for workers. The approach also includes support for local communities to develop plans to identify “high growth-areas and connect employers with training providers to upskill and reskill jobseekers to fill current and emerging jobs in demand”. The federal government also has the Canada Training Benefit for workers which can help cover some of the expenses of training fees up to a lifetime maximum of $5000.
Problems with Canada’s Current Approach to Transition Fossil Fuel Workers
Unfortunately, the TD report states that the existing approach to transitioning these workers leave much to be desired. Financial supports are insufficient and more supports aimed at those who have lost jobs are needed. The Canada Training Benefit is insufficient if workers require extensive retraining such as for multi-year degree post-secondary education programs. A government of Canada website states that the average undergraduate tuition for just 1 year (the 2021/2022 academic year) was just under $5000 CAD to about $22,000 CAD depending on the field of study. The approach taken thus far is also not standardized across the country. According to the TD report, retraining programs in Canada are currently provided by a “loose network of post-secondary institutions, for-profit institutions, non-profit organizations, and labour groups” without any centralized authority or approach. The Canada West Foundation has argued that the federal approach does not commit to focusing supports in the same geographic locations that are expected to lose significant numbers of fossil fuel sector jobs – such as Alberta, Saskatchewan, and Newfoundland and Labrador. A second fault the Foundation finds in Canada’s current transition plan is a lack of support for local companies in areas where significant job losses are expected. They argue that “It is more efficient to transition existing companies to providing a new product or service than to create new companies or attract different ones to a specific location”. A final suggestion made by the Foundation is the collection of Labour Market Information (LMI) that identifies, in the different communities affected by significant job losses, the number of individuals with specific competencies that would be required by specific types of employers.
Singapore’s Solution
Singapore’s SkillsFuture program is cited as a global leader in retraining and should be adopted in Canada with adjustments to account for our local situation. According to its website “Skillsfuture is a national movement to provide Singaporeans with the opportunities to develop their fullest potential throughout life, regardless of their starting points. Through this movement, the skills, passion and contributions of every individual will drive Singapore’s next phase of development towards an advanced economy and inclusive society.” The website also says that with the SkillsFuture program “No matter where you are in life – schooling years, early career, mid-career or silver years – you will find a variety of resources to help you attain mastery of skills”. Significant course fee subsidies are provided to encourage retraining. The SkillsFuture program has identified Continuing Education and Training (CET) centres that provide a curriculum meeting the requirements of this program. The SkillsFuture program provides course fee subsidies for up to 90% of course fees for citizens aged 40 years or above with their Mid Career Enhanced Subsidy program at CET centres. Singapore citizens and Permanent Residents who do not qualify for the Mid Career Enhanced Subsidy can receive subsidies of up to 70% of course fees if studying at a CET centre. The SkillsFuture program also allows individual and company-sponsored training and provides extra support for small and medium enterprises.
The TD report argues that the most important aspect of the program is the level of granularity with which it targets skills. The SkillsFuture program has targeted 32 sectors and all possible pathways to employment for each of these sectors including possible occupations for each pathway. The program then makes training available to ensure that skills to pass through the pathway are gained such that those taking part can meet the needs of employers. This focused approach has identified 1700 occupations across hundreds of pathways and allows for the standardization of training for each pathway by working with employers.
The SkillsFuture program has had significant use. About 660,000 people and about 24,000 enterprises took part in this program in 2021 which is significant given that Singapore’s population in 2021 was about 5.5 million people. This figure grew from 540,000 people in 2020.
According to a Singapore government website “In 2019, 86 percent of over 43,000 trainees surveyed by SkillsFuture Singapore (SSG) using the Training Quality and Outcomes Measurement system, indicated that they were able to perform their work better after training.”
Next Steps for Canada
We need just transition legislation that supports workers transitioning away from the fossil fuel industry. The approach should include a proper mapping of pathways to employment – like the SkillsFuture Singapore program – for workers and communities that will be affected by losses of fossil fuel jobs. This requires working with existing and potential new employers in these communities. We also need to work with each individual worker who losses a fossil fuel related job by providing information on different pathways to suitable new occupations. These pathways will outline the education and new skills needed to make high paying employment possible. A proper determination of pathways will also identify transferable skills that the jobseeker already possesses required for new roles in their local community. Once an appropriate pathway has been established for a jobseeker a training program needs to be designed to achieve employment. Training institutions should follow Canada-wide standards to ensure high quality education. Costs for this training should be provided by potential new employers and the government. The job seeker can pay some of the costs of the training after getting suitable employment. Funds for this transition can be collected from the existing federal carbon tax. The ultimate objective of our just transition approach should be to move our approach to one where we support lifelong learning so that workers will always have the skills to meet the evolving demands of the 21st century workplace. Working with both job seekers and employers in targeted communities will help reduce the burden of job losses in communities that rely on the fossil fuel sector for jobs. This approach will also grow the number of Canadian workers who have the skills to work in a green economy. We need to start acting on a just transition plan now to ensure that workers and communities make this much needed transition. This will help make our fight against climate change work a success.
