OGGO Committee Meeting

     Committee members, this is meeting number 40 and it is televised. We are still studying the stimulus package and its impact on stakeholders.

    We have before us, from the Building and Construction Trades Department, Mr. Christopher Smillie, accompanied by Larry Cann and Stephen Schumann.

    I understand you have a presentation, Mr. Smillie. Is it a ten-minute one? Because the first hour we will devote to a discussion and in the second hour we are going through estimates.

    Yes, ma'am.

    So the first hour is yours. For ten minutes, Mr. Smillie, the floor is yours. Thank you.

    Thank you, Chair.

    Good afternoon, Chair and members of the committee. Thank you for inviting me and my colleagues to share my thoughts on the economic stimulus package and the impacts on our organization and the construction industry as a whole.

    I've noticed that there are not many other witnesses with me today. I've got these two, but it's going to be hard to hide at the back of the class today.

    I have tried to put together a balanced view of what's going on in our industry for the committee. I did my best to bring you some relevant facts and figures that should assist the committee. I want to preface my comments today with a statement of support for the stimulus package and the value of the commitments to spend the government made to our industry.

    The organization I represent is called the Canadian Building Trades. We represent about 550,000 organized construction workers from coast to coast to coast. Our members work in 15 different crafts across the country in over 50 specific trades, ranging from heavy equipment operators, to carpenters, to welders, to bricklayers, and everything in between. We build infrastructure, heavy industrial plants like oil refineries, nuclear plants, schools, hospitals, and homes.

     In preparation for my remarks today, I found some important formal information and also first-hand research from our member organizations.

    According to the labour force survey produced by Stats Can November 6, 2009, employment in our industry edged up slightly from record lows in October; however, it is still down 5.8% year over year. This equates to about 73,000 fewer jobs in our industry than this time last year. All of the regions in our country have been hit substantially, but particularly hard hit have been the regional economies of Alberta, Ontario, and British Columbia. Our trades have not been spared from the job losses and slowdowns. This is why the economic stimulus package is so essential. This package provides assurance to the private sector that it is okay to invest, it is okay to proceed with private construction projects in this uncertain time. If the various levels of governments are spending, theoretically it's okay for other projects to proceed.

    Historically our industry is generally a late responder to economic events. We're usually the last into and the last out of recessions, but this time seems to be different for a good portion of our trades. I surveyed a number of our trades across the country to give this committee a first-hand account of business volumes for our civil trades. They are usually the first trades on the job site and would be the first to benefit from increased volumes of work.

    As a short background, we measure business volumes in hours of work. So here is a bit of an overview of how some of the trades are doing. The information is real time in nature and will hopefully provide you with general trends when examining the stimulus package in greater detail. If the committee would like any of these numbers tabled officially in a more user-friendly manner, please let me know afterwards and I can arrange for that.

    The International Union of Operating Engineers is the trade involved in clearing sites with heavy equipment. They operate the cranes you see in downtowns across the country and they do all the sewer and plant waterworks across Canada. As of October 2009, the operators are experiencing 13% unemployment among their 30,000 membership in construction. This is more than twice the unemployment rate in 2007 and 2008. Those who are working in 2009 are working fewer hours.

    The carpenters--I have a fellow carpenter on the committee today--are one of the first responders in construction. They're on the work site first. They build the forms into which concrete is poured and in which the reinforcing steel placed by the iron workers is held in place. The carpenters build all the scaffolding that support all the other trades along the construction continuum. The business performance of the carpenters therefore is a good leading indicator or proxy as to how the other trades will perform in the future. Nationally, the carpenters are forecasting work volumes to increase slightly in 2009, hold steady in 2010-2011, and then fall off a cliff in 2012. There is little private construction work in the pipeline for them. What they are counting on for 2010-2011 is the stimulus money.

    The carpenters' office in Toronto, for example, provided some numbers for the committee for trending purposes. They are as follows. In 2007, 15 million work-hours. This equates to full-time employment for about 7,500 members. In 2008, 16 million work-hours. This equates to full-time employment for about 8,000 members. In 2009, year to date, 9.3 million work-hours. This equates to full-time employment for 4,500 members.

    The labourers in Laborers' International are first responders in our industry. They do much of the road work you see on your way home at night. They do most of the concrete finishing work for sidewalks and curbs, and they do much of the work for municipalities on sewers, water mains, and general labour on all construction sites.

     At year end, LIUNA in Ontario is forecasting an approximate 35% reduction in work-hour totals. In 2007, LIUNA Ontario enjoyed 32 million work-hours and in 2008 about the same. Year to date, 2009, they're reporting approximately 19 million. With the end of the construction season closing in on us, there's a long way to go to get back to normal levels.

    Now, if I may, I'd like to share with you some of the numbers I've found in two of the industrial trades. Those trades are involved mainly in the delivery of services in the institutional, commercial, and industrial applications. The IBEW, or the electrical workers, is headquartered in Toronto and represents electricians in Ontario. They're involved in high-rise electrical work, industrial electrical, power line, and some residential electrical work.

    The electrical workers are experiencing a year over year decline in work-hours. From the numbers they provided to me for this committee, it appears there's a 19% decline in volume. Specifically, in 2008 this office witnessed about 14 million work-hours and are on pace to finish 2009 with approximately 11 million.

    The final example I'd like to share with you from our trades is the experience from the UA, or the plumbers and pipefitters. The UA is involved in plumbing, pipefitting, steamfitting, and welding in commercial and heavy industrial applications. A small portion of their work is in the residential sector, namely in the GTA. The UA office in Toronto is on track to deliver approximately 28% fewer work-hours for 2009. Last year their members worked approximately eight million work-hours and this year they will do about six million.

    So what does this all mean? It's a lot of numbers, and the compilation is important. From this raw data evidence, the importance of the stimulus spending trumps a number of other industry priorities in the short term. The construction season for the outdoor skilled trades is coming to an end shortly, so essentially the spring of 2010 will be the make-or-break period for them. If there are stimulus projects to replace private industry projects, there will be a softer landing for Canadian construction. If there are no stimulus projects to work on, it will be a different story and we will witness further significant declines in employment.

    The Construction Sector Council, which is part of the sector council program with HRSDC, did some recent forecasts where they assumed 30% of the infrastructure money has actually flowed and hit the street. This has led to the creation of approximately 34,000 jobs. This also assumes that approximately $4 billion has been spent by consumers on items eligible for the home renovation tax credit, and the 2010 contribution has been made for the not-for-profit housing sector by the government.

    So if we assume all these things, the Construction Sector Council says, 34,000 jobs have been created. As we learn from StatsCan in a labour force survey, we've lost 73,000. So even if this 30% of the money has hit the street, we're still in the hole about 39,000 trade jobs due to the recession. Without the stimulus package, who knows where the job numbers would be. The hours for my trade as I reported to you would certainly be lower and the work picture more dire.

     I spoke with a number of my employer partners, and they indicated to me their design and engineering departments are starting to build momentum. However, they are not at or near capacity. The lag time to translate these engineering volumes into actual shovels in the ground is at least six to ten months for non-complex projects. When contractors bid on a job, they have to be able to prove capacity to do the work, and the scope of what else is in the pipeline matters.

     Recent information and analysis released by reconstruction data proposes our industry will be passing through what economists frequently call a U-recovery. The scenario depicts gradual and slow pickup, not the V-shape, rapid, robust, and solid recovery we all want. New construction starts in residential are forecast to be down, new starts in commercial are about 50% of where we were, and industrial projects are waiting to see where the Canadian and U.S. dollars are going to land.

    I want to quickly provide you with some ancillary information from the United States. Recovery.gov is an excellent resource for the construction industry and citizens alike. This website was initiated by the Obama administration to show transparency and progress in reporting to the general public. All stimulus projects are coded, labelled, and tracked for all to see. For example, if someone wants to get information on stimulus money in Cincinnati or Phoenix, you're able to see what contracts are stimulus contracts, who's the responsible state authority, who bid on the job, who won the job, who the subcontractors are who are working on the jobs, where the job sites are, and so on. Most importantly, this site outlines the amount of direct employment created by the project.

     This is a tangible deliverable that the government can deliver to its citizens. This assists us in planning for the actual execution of the work.

     In preparation for my remarks today, I read through the testimony of the Parliamentary Budget Officer and his officials, which was delivered to the committee on October 27. It seems that he and his staff are having difficulty tracking the progress of the money coming from the government. The Recovery.gov experience is a valuable example of how transparency could be an effective tool to promote the good work that's going on in the Government of Canada and at municipal and provincial levels.

     In addition, I echo the concern of Brock Carlton, from the Federation of Canadian Municipalities, when he says his membership is concerned that the ISF fund has very restrictive and time-sensitive requirements. In construction, if a job has a number of variants, change partway through the planning stage--like another lane added to a highway or difficulty with soil conditions and bridgework, for example--could delay the completion of a project.

    The economic stimulus package is probably the single most important piece of government involvement in our industry in 20 years. Our industry has a lot at stake and so does Canada. We have 1.6 million Canadians in our industry and, according to the Construction Sector Council, we represent 12% of GDP. Ten years ago, we had less than one million people engaged. This means that if there isn't the volume of work that will carry around the current capacity of people, the system will adjust.

    Excuse me, Mr. Smillie. You've gone past our ten minutes.

    Thank you.

    It makes sense to bridge construction through the next period of normal activity in 2013. We respectfully submit that our industry matters and we ask this committee to take the spending commitments in the stimulus package seriously. We're supporters of the plan and we want to be part of the action.

    I look forward to your questions today. In case I can't answer them all, I brought some colleagues of mine from the various organizations to assist.

    Thanks very much.

    Thank you.

    We'll go to the first round of questions.

    For eight minutes, Ms. Hall Findlay.

    Thank you very much, Madam Chair.

    Thank you very much, all three of you, for being here with us today. As somebody who has actually worked in construction and has been somewhat involved with the building trades in the past, I offer you a particularly warm welcome. It's great to have you here to talk about your version of events, given the stimulus package.

    I want to ask a couple of questions. I'm looking at page 6 of your presentation, where you talk about the job numbers, the employment numbers. You say, “According to the Construction Sector Council recent forecasts, where they assumed 30% of infrastructure money announced has actually hit the street...”. My first comment is that even that's speculative, and your numbers are speculative, and you acknowledge that we're still very much in the hole even if those numbers are right and even if the Construction Sector Council's assumption is correct.

    That's correct.

    One of the challenges we have had in opposition is that we have been asking for information on what has actually been spent. Here, the assumption is that 30% of infrastructure money has actually hit the street. We've been asking repeatedly for job creation numbers, and to no avail.

     One of my concerns is that the most recent information from the representatives of municipal organizations across the country has been that of approximately 3,000 projects that have been announced, barely a third have in fact been started. So if only a third of the projects announced have actually been started, they certainly haven't been finished.

     If that's the case, if only 30% of the projects have only been started, there's no possible way that a full 30% of the amount of money can have actually hit the street. I would question the assumption of the Construction Sector Council--it's nothing against them--just because, admittedly, we're having trouble getting that information.

     Based on that alone, do you have any comment, given your employment numbers and that speculation and if I'm telling you based on our information that there's no way 30% could have hit the street? Could you just comment on that?

    It's difficult to comment because there's no way to tell, when a project is in the development stage, if it's a stimulus project or not. There currently isn't a way to check and see, albeit you can call the various construction companies involved in the bid process to ask them if this is a stimulus project or not.

     I can't really say much more than that, other than perhaps it behooves this committee to come up with some sort of a way to report that to Canadians. I really can't comment more than that. It's difficult when there is no tracking mechanism out there similar to the one in the U.S. It's tough for regular people to go in and check and see what's happening.

     I'm smiling only because you perhaps unwittingly have reinforced something we have been saying for months and months and months, and it is reassuring for us. It's frustrating, but it's reassuring for us to hear from people who are actively involved in what should be the results of job creation from a stimulus effort and who are having exactly the same concerns.

    I must say that your references to recovery.gov, in the United States, say the same thing. We've been saying this for months. The example from the United States is extraordinary, and if I can just quote you: “...this recovery.gov experience would be a valuable example of how transparency could be an effective tool” and this would be a good example for the Canadian government to use. I hope my colleagues on the government side of this committee room are listening.

    I'm turning to what is page 8 of your presentation. It's a little bit along the same lines, but you talk very helpfully about the time of projects. You are speaking here about the lag time translating engineering volumes into actual shovels in the ground being at least six to ten months for non-complex projects, sometimes more depending on the job. That is another concern we have raised in the context of the 2011 deadline for projects—and it is a concern we've also heard from municipalities. We've lost a construction season. With those two-thirds projects that have not yet been started, there is a concern that the municipality—as they have been told so far—is going to be on the hook for the entire cost if a project is not completed by 2011, given exactly this problem of lag times and the time for any kind of project to be completed. Can you comment also on that? If you put yourself in the position of a municipality that has a project not yet started, knowing that you will be on the full hook for the cost if it's not finished by 2011, would you be inclined to question now whether you should even start this project come next spring?

    I know it's unfair to put you in their position, but you know something of the construction business, of course, so....

    I appreciate the question, but I think members around the committee already sort of know the answer. The likelihood of a project proceeding if one of the partners says “Well, we're not proceeding any more” is pretty unlikely. I don't want to be overly critical in my comments, so really that's all I could add to that.

    Really, if you have three business partners involved in a project and one says “Sorry, we're not proceeding any more”, it's tough to move forward. I'm not blaming anyone. The rules of the game are the rules of the game, but that's sort of my take on it.

    To be clear, I don't think anybody is saying at this point that any one of the three partners is saying they're not going to play, but we are here, as opposition, absolutely expressing concern that that might be the effect of the requirement that a project be completed by 2011: municipalities may choose not to start projects.

    Maybe I can open it up with the similar concerns I have, the comments on recovery.gov, the example we've seen in the States, and recommendations for this government if you would like to do that. Do you have any comments on my questions about lag times for projects and the ability of municipalities to start? Mr. Cann, Mr. Schumann, I'd love to hear your comments too, if you care to provide some.

    You have 30 seconds, please, and then your wrap-up.

    Okay. Thank you.

    My main comment, again, is that I lived through the 1990s, with the huge recession we had then. What came out of that was the problem we've got today with the shortage of manpower.

    When there's a shortage, the problem is that the people you have already have to go to work and you don't bring new apprentices in and new young people into the markets. That's one of my real concerns. The concept of the moneys and the recovery is good, but everybody needs to understand the importance of the long term. The demographics of people my age being about to retire and young people not getting into the markets, and your lag times, and all the things you have to deal with, they all have an effect on the opportunities for our young people to get into things and in turn make skilled tradespeople for the future. So that's very important.

    Thank you for that addition.

     Thank you.

    Madame Bourgeois, eight minutes.

    Thank you, Madam Chair.

    Good afternoon gentlemen. From the outset I would like to say that I have enormous respect for people in the construction sector because they depend on supply and demand and they also depend on temperature, events, and the economic climate. I am therefore very sensitive to what people in your sector are going through.

    I'd like you to answer this question by yes or no: do you represent those who are working in Quebec. Yes? Fine.

    Furthermore, you have placed a considerable amount of hope in the stimulus plan. Mr. Smillie, from what I understood of your comments, you are hoping that the government will continue with its stimulus package and that this will lead to results in 2010. Am I correct?

    Really, with some of the pull-back we had in private construction over the last 15 months, the stimulus package is the major business piece for our trades over the next 18 to 24 months. Because of the economic crisis, with the credit crunch, a lot of the construction companies were unable to secure financing for large projects. For example, in the oil sands in Alberta many oil companies had to pull back on projects due to lack of financing. What you'll see is a shift from employees working on large industrial projects to working on civil projects, such as sewers, water mains, roads, and institutions. So it's this shift that we're hoping for.

    The last thing you want to have is a large supply of manpower or people power, so to speak, and no work for them to do. So right now we're going through a process where we're shifting focus away from large industrial projects that won't happen, back towards infrastructure and civil jobs.

    The stimulus plan does not just deal with infrastructure projects: funds are also being allocated to research and development. The Economic Development Agency of Canada is investing among other things in support for businesses.

    You seem to be saying that the number of jobs created in infrastructure has not been very high. Do you think that the money invested in your sector by the Economic Development Agency has nonetheless led to results in research and development? Have your businesses been assisted? Was the level of that assistance sufficient? Has it led to job creation?

    I think, rather than research and development—I can't quite comment on that—our trades have been supported by an extension in employment insurance benefits. Indirectly, our folks would benefit from training provided through these EI funds. If we want to call that research and development and add training, our folks have benefited and will benefit from that.

    On the research and development portion, the only piece I could comment on would be carbon capture, storage, and sequestration. There is money that has gone to large companies to do research on CCS technology, and eventually, when it gets to implementing these large industrial apparatuses, our members will benefit.

    On the issue of approving municipal infrastructure projects, the government launched its recovery plan quite quickly, and municipalities, especially the smaller ones, are having difficulty submitting their projects in time. Bigger municipalities have more engineering services at their disposal and often plan many projects in advance, which smaller municipalities can't do.

    You state in your brief that six to nine months can go by before a project finds itself on paper. Have municipalities had to hurry in order to be able to submit their projects? If that's the case, could one say that the security of construction workers is at stake?

     I am aware that the municipalities went through a process where they identified projects that they could grab from the hopper and use for infrastructure moneys.

    In terms of the process, I can't really comment too much on the process because our folks were further down the line. We don't get the work until the job is fully bid.

    I can't really comment on the security of these job sites. At the end of the day our folks are the skilled-trade folks who go to work and build these things. We're not involved in the decision-making process for which projects will proceed or not.

    The municipalities are in a hard spot.

    Mr. Smillie, were the jobs created quality jobs or were they temporary jobs? I'd like you to talk to me about those jobs.

    Merci pour la question.

    The jobs that are being created are first-class, skilled-trades jobs. There is a range of jobs that is created through these stimulus projects--all the engineering, all the draft work, and then our jobs when they get out to the field. There are something like 1.6 million Canadians involved in construction, and I'd be hesitant to say any of them were not quality jobs. Our members are the highest trained and some of the best skilled in the business.

    The construction industry is a great place to have a career. I think these jobs are high quality. It's not what someone would deem a lower-quality job.

    Thank you very much.

    Merci, Madame.

    We now go to Mr. Warkentin, for eight minutes.

    Thank you, Madam Chair.

    Mr. Smillie and gentlemen, we appreciate your attendance this afternoon.

    I come from the construction industry, as you know, and when you talk about the high quality and good people who work in that industry, I couldn't agree more. It's truly a group of professions that are often the unsung heroes of Canadian life and are the underpinning of many communities. So we appreciate you gentlemen, and also the folks you represent.

    Today I want to talk about a number of things. I actually want to follow up on one of my colleague's questions as it relates to websites and different things. I'm wondering, Mr. Smillie, if you're familiar with the website called creatingjobs.gc.ca and the outlay of all the stimulus projects and construction projects on that website.

    I have to admit I haven't seen it. What kinds of things does it have on it? Sorry, I'm asking you questions now.

    I appreciate that, and I think it's helpful not only for you but for anybody who is interested. It outlines all the infrastructure projects that are being brought forward through the stimulus dollars. It's the Canadian version of some of the American websites.

    What I would recommend both to your association and others is to take a look at it, and if you have suggestions as to how that website might be improved to give information that's relevant and helpful to you, we'd be happy to take that feedback back to our minister and the department so that you have the information that's helpful as it relates to the jobs that are being created with the thousands of projects that are under way.

    As you know, and as you've outlined.... The concern of everyone in this committee is that the stimulus money get out there to help those folks it was intended to help. Clearly, tradespeople are on the top of that list.

    Of course many of these projects were determined at the municipal level, and there are many municipalities that chose projects that were pre-engineered and ready to go within the next couple of years, if not this coming year. They actually allocated the funds at the municipal level to other projects.

    I'm wondering if you're familiar with situations where tradespeople are already undertaking complex construction jobs. I just don't want to leave folks with the illusion that no complex construction job is actually hiring tradespeople right now.

    Yes, sir, I believe there are a few bridges in the Ottawa area, and there are a few of the bridges heading to West Island in Montreal that have already begun some of the repair work under some of the money that's included in this package. I don't have exact numbers on how many people would be involved on those specific projects, but those are the ones I'm aware of that are happening in real time.

     Just another thing, and maybe just as a piece of information that's helpful for all committee members to recognize: I know that there was a suggestion a little bit earlier, and I just don't want to leave people with the impression that if a municipality undertakes a construction project and it's not 100% complete, they're not able to receive any of the government funds. What the government has made clear is that the municipality and the construction companies are able to bill as the project is completed, but that billing will cease and payment will cease after that point in time, after the deadline of March 31, 2011. I just do that for clarification because I know that most members of the committee are familiar with that, and you gentlemen will be familiar with that, but there are other people looking for information from this committee. I just put that on the record so people are not under the illusion that such a thing is taking place.

    I appreciate the documentation you brought forward. I think it's very helpful. It indicates that clearly there's a necessity to continue to work to stimulate the economy for tradespeople, but it also indicates that you see an anticipated increase in the employment of tradespeople.

    You talk about the drop-off of 2012, and that concerns me and committee members as well. I'm wondering if you might be able to just identify what your association and your groups are doing in considering some of the projects that are currently being announced. I come from Alberta and I look at the Alberta context. I know that some of these large industrial projects that were put on hold or cancelled are now coming back on stream. I think of the Firebag project that was just recently announced, which is billions of dollars in investment and clearly will hire thousands, if not tens of thousands, of tradespeople.

    Have those numbers started to come into your calculations, or are those announcements too early or too recent?

    Insofar as they were recent, we always had a view to workforce planning for what's coming. There are two facets to this question. There's the new construction, the new build, and then there is also maintenance of current facilities. When we're looking at either stream, new construction is viewed upon as having fixed time periods where you require people. So the electricians go in from April 1 until June 1, the ironworkers go in previous to that. The new construction is viewed in blocks. However, the maintenance of the facilities close to Firebag and around Firebag is part of the industry that is very labour-intensive. So what we do is look at manpower: who's currently not working? There are people in New Brunswick currently not working. We try to get them to Alberta to man those shutdowns, so to speak.

    There are really two facets: there are the new builds, and then there's maintaining current facilities.

    I know that you've identified Alberta as one of those areas where there has been a reduction in tradespeople being hired by industrial components. I'm hopeful, and maybe it's too early, but I'd be interested in the analysis of these projects that are being announced and how they will decrease unemployment, gentlemen.

    I just have a comment that when you talk about shutdowns—and I think Larry touched on this too—we have a concern. The way everything's happening right now in the turn is actually providing a skilled workforce. The upcoming shutdowns are going to require a huge workforce and a skilled workforce that right now, because of the current downturn, we've lost. They've gone to look for jobs in other sectors or other provinces. So to fill those needs is going to also be a challenge.

    We'll bring people in from other provinces, but as well we're looking to bring in some workers, if possible, from the U.S., and to try to deal with foreign credentials that way. It's great that we're talking about the here and now with infrastructure, but we also have to look at the long term, and that is a skills issue. It is loss of apprentices, it's the loss of the workforce. That skilled workforce may not come back because they'll find other employment elsewhere or in another sector. It is hard, in many ways. You can plan, but you also need to plan the workforce issue, and that is a bit harder to calculate because you don't know if you're going to get them to return.

     Thank you.

    I'm running out of time, but I want to take up that issue. Maybe you can provide for our committee suggestions as to how we might be able to ensure that in the long term we don't lose tradespeople. I'm most concerned about young people right now. There's a reluctance to go into the trades because there don't seem to be the immediate openings.

    I spoke to some of our college presidents who represent trade schools. What they're finding is that, number one, there are limited opportunities for apprentices or future apprentices to be hired on right now, so they're finding their enrolment is down at their colleges. I think we would be interested in what you could provide in terms of feedback.

     Mr. Warkentin, your time is up. We can ask them to respond when they're making their closing remarks.

    Mr. Martin, for eight minutes.

    Thank you, Madam Chair.

    Thank you, guests. Steve, Christopher, and Larry, it's great to see you here. It makes me very proud, actually, that the building trades are making a presentation to this committee. Having spent my entire working life as a journeyman carpenter, I thank you for pointing out not only the value that your industry brings as an economic driver, but also how it's a good measurement too. It's a barometer for how the economy is doing as we watch the building trades industry.

    Not to be repetitious, but I think there's a bit of a motif developing here. Many of the answers come back to the human resources question. So my first question to you is a simple one. Will you be able to meet the human resources demands to staff the other 60% or 70% of these projects as they go forward? You answered it partly, I believe, but I'd like to hear more about the option.

    Maybe I'm not phrasing this well, but one of your strengths and our strengths, with my union, is that we're international unions. We belong to one North American collective, a pool of skilled labour. Rather than bringing in temporary foreign workers from all over the world, would it not make sense to just relax the border somewhat, so that if we can't fill that job with a qualified Canadian, we could at least bring that person from our affiliated local unions south of the border? I think it's worthy to expand on that if any or all of you would like to.

    I'll go first, guys.

    It really is an opportunity that we have before us to do something differently. The current situation with U.S. workers coming in to do trade work in Canada is that U.S. workers are treated exactly the same as any other person would be from a foreign country. So it's the same process. They're still considered to be temporary foreign workers. In fact, the largest percentage of temporary foreign workers in Canada is from the United States, the second being that from Britain.

    It really highlights an opportunity for us, going forward, if U.S. workers were treated not differently but in a front-of-the-line way, in that we do have similar organizations across the borders where we could have a North American workforce. I would definitely be supportive of that kind of system, whereas right now it's up to the contractors to go through the temporary foreign worker process. And therefore it's similar to that of bringing in someone from--let's use a country that's farther away--let's say, South Korea, so it's the same process for bringing in Americans and South Koreans.

    There is definitely an opportunity for us to leverage weaknesses in the U.S. market right now and bring those members to Canada when the work is available. So I would argue that the stimulus is a good opportunity for that.

    I think it's an absolute natural, I really do. We have NAFTA and we were supposed to have the free movement of goods and services across our border. Why not the free movement of labour, as long as--

    Yes, sir. NAFTA excludes trades workers, so it doesn't include them.

    We just had this airport built in Winnipeg. It was teams of Lebanese workers who had just come from Latvia. Some labour broker moves this group of carpenters around the country, so our unemployed carpenters were standing outside the fence looking in while a bunch of Lebanese guys--and I have nothing against Lebanese people, but they weren't Canadians--were doing our work and taking that money out of the country in terms of wages. I would much rather have a fellow member of my own union, who is trained at the same skill level as I am, come up from Minneapolis than have some guy getting flown in from Latvia to eat our lunch.

    Would anybody else like to comment on that?

     We've already started a program. We've already been to Detroit to start with the states that are close to the border. Most of the requirements for our trades are Red Seal requirements. So we've gone down there to have a “train the trainer.” We have thousands of individuals who are pipefitters, welders—basically the same skills that we have here in Canada—but they can't get across the border.

    With the outages coming up in the spring in Alberta, they're talking about needed 10,000 or 12,000 tradespeople. They have the perfect storm coming where all the refineries want to do their shutdowns. So there's going to be a problem if we can't man it up.

    The apprentice situation is one problem. But that's something we'd like work on with our partners, both federal and provincial. We want to put in place a more streamlined process to help get them across the border so they can come here and work. They have a lot of the same qualifications, but they may not have the piece of paper. It's quite easy to get them here and to transport them back home again. I think it would be a good solution to a lot of our short-term needs. For the long term, we need the stimulus to get young people into the trades. It's hard to get young people in today because there's a shortage of job opportunities. But in my trade, we turn away many highly qualified people because there aren't enough job opportunities.

    There may be a few trades where there is a shortage, but our organization is 20% to 25% apprentices. Over the last five years, we've tried to up the numbers. I can only speak for my trade, but we see the shortage, and we're trying to work with everybody to make sure we get there.

    Mr. Martin, I spoke with one of my contractor partners in Alberta who brings in temporary foreign workers from country Y. The average cost to bring that worker to Canada, lodge him, and then send him back is about $15,000.

    The cost of using an American worker would be much less, around $5,000 per worker. If we could bring in American workers, it would definitely appeal to my contractor's bottom-line mentality.

    They'd also be able to count on the level of training. In all likelihood, the UA member from the United States would have gone through a very similar, if not the exactly same, apprenticeship system. Wouldn't it be a two-way street? There may come a time when the U.S. needs people, and our unemployed tradespeople could more easily go down there.

    Mr. Martin, it's time to wrap up.

    Anyway, thank you.

    Ms. Foote.

    Thank you.

    Thank you for being with us this afternoon. I especially appreciate it because my husband is a journeyman electrician. I've known the industry since—

    Is he home at all?

    He's no longer working as a journeyman electrician, not that there aren't opportunities there.

    I agree with you that in my province, Newfoundland and Labrador, there has been a focus on getting young people into the trades. For the longest time, we didn't encourage young people to look at the trades as a future career. There is an opportunity there, and I think we need to encourage young people to take advantage of it.

    I was interested in your remarks about the importance of the stimulus spending. We all know that this deadline of March 31, 2011, is coming up on us. In effect, we've gone through one construction season now, so we're looking at the spring of 2010 as the next opportunity. You talk about the need to continue with stimulus spending, and I know that when the Federation of Canadian Municipalities appeared before us, they too talked about the importance of the stimulus spending and their concerns with respect to that deadline of March 31, 2011.

    I don't know if you have seen Minister Flaherty's comments, but apparently his plan is to use a Friday speech to dampen expectations for the 2010 budget. He will try to impress upon Canadians that they shouldn't anticipate another extravaganza of stimulus spending. People shouldn't expect huge amounts on top of the money that's out there, one government official said. I'm quoting from an article that appeared in one of the newspapers. With that information and with the news the Federation of Canadian Municipalities received when they went looking to have the deadline extended, that this is a firm deadline, explain to us the impact this is going to have on the construction industry.

     I think as long as the commitment to spend and the commitments that have been made in the stimulus package are actually followed through with, we will have a softer landing in the construction industry than if someone were to flip a switch tomorrow and say we're not going to spend in the future.

     I haven't seen Mr. Flaherty's proposed comments, but I guess we're in a situation now where we have $56 billion in deficit and maybe it sounds like he's going to try to rein things in. I can't really comment, as I haven't seen them yet. But in terms of what it would do to our industry if someone flipped the switch tomorrow, it would be devastating to our members, who are counting on the public spend. I can't really speculate going forward what we would look like. We sort of have to play within the field that we have.

    Guys, did I miss anything? No?

    At the end of the day, if we didn't have the stimulus package we have today, the employment numbers that I provided to you probably would be much worse, because private industry would not plan to move ahead with their projects if the people of Canada or the Government of Canada said, “Well, we're not going to spend either.” There is definite value in the intent to spend, because private industry sees that and they say everything is going to be okay--or better than it could be without it.

    So if in fact what Mr. Flaherty is reported to have said is real, then falling off the cliff in 2012 is something you're obviously not looking forward to.

    Well, the falling off a cliff in 2012 is if the stimulus money doesn't move forward. I guess it's hard to explain, but in construction, the work that has been planned in 2010 and 2011 won't roll out until the end of 2012. So we're about a year and a half behind everything else. So 2012 could be scary if private industry doesn't move forward during 2010 and 2011 with a number of the projects that government is looking for them to do.

    Is that fair?

    We'll go to Mr. Nadeau, pour cinq minutes, s'il vous plait.

    Thank you, Madam Chair.

    Good afternoon gentlemen.

    The government's recovery plan was launched in the context of an economic crisis for obvious reasons. I would like to hear what you have to say on employment insurance and programs for workers who have been let go and who have other trades and live in areas where jobs are necessary as a part of the recovery.

    Are you working with employment insurance officials on providing courses to various trade sectors or non- specialized workers that you may need? Are you also looking at programs for older workers who are at the end of their career and who may still have three, four or five years of work before retiring?

     Sir, I'll deal with the last question first.

    On the older worker program, I'd like to say that a number of our trades have been getting involved with displaced auto workers--for example, members of CAW, etc., who have been displaced in southern Ontario. They're working with those organizations to help them retrain.

    In Canada it takes three or four years to cook a construction worker. Some of the trades are licensed, so it takes time to get that licence. However, we are working with other parts of the economy to find people who are willing to join our industry and also to get them up to speed.

    Is there a particular older worker program? None that I'm aware of, although we are looking at assisting displaced people to come to our industry.

    Your first question was around programs, specifically with EI. A lot of our training centres do deliver provincial curriculum. They're sanctioned to deliver the curriculum of Ontario, the curriculum of Quebec, or the curriculum of British Columbia. Those are EI-eligible curriculums.

    Is there retraining going on within our ranks? Yes. The Employment Insurance Act is very complicated, but the part II money is generally the money that is used for delivering curriculum, providing assistance to displaced workers, and so on.

    Really, our workers benefit in two ways from EI under both parts of the act. Under part I of the act, we benefit when members are out of work and they actually claim EI and get an EI cheque. Under part II, the operating engineers, for example, in Oakville--I don't want to speak for Mr. Schumann--deliver Ontario curriculum for crane operators, so there is also a connection that way.

    That would be the best I could provide in terms of an answer.

    What about labour mobility? I come from the area, from Gatineau. We know that there are agreements between Ontario and Quebec on the mobility of workers given the various qualifications required by unions. Are there any obstacles? Is the situation improving?

    Yes, sir, the communication piece around adjudicating different licences, etc., is improving between jurisdictions. We still have an issue with mobility--i.e., can we actually get the member from work site A to work site B? A lot of the time, it's money out of their own pocket. Members have to pay the $3,000 to fly from Saint John to Fort McMurray, or they have to drive six hours from Hamilton to, say, Goderich, to where the work is.

    So there are financial barriers that construction workers come up against in terms of mobility, but the red seal--I would say, guys?--is still the best way for interchangeability between provinces and jurisdictions.

    I know from our locals in Quebec that there are several who've now gone to Manitoba to work on some of the hydro facility projects out there. So there is mobility.

    There is a bigger question in there that we won't discuss here, and that's the question of standards. Every province also has different work standards and skill standards. If you're red-sealed, you can work anywhere in Canada. However, if you're not from the red seal program, depending on what province you're from, the standards of training that you've received may not qualify you to work in another province.

    I know that Ontario and Quebec have very high standards, whereas British Colombia actually would have fairly low standards. A worker from B.C. to come to Ontario would likely not meet the qualifications to work in many of our trades.

    Members, I think there's been interest in questioning. The analyst has told me that she can do her presentation in half an hour. I'll give you another 15 minutes so that we can proceed with questions from everyone.

    Mr. Anders.

    Thank you, Madam Chair.

    I just want to express that I too have an interest with regard to these issues of foreign workers. I think Mr. Martin raises a very practical and wise point in the idea that Americans probably have training that is more compatible with regard to Canadian standards than people brought in from Lebanon have. I think that's an interesting point.

    That being said, I have a colleague who'd like to raise some questions. I'm going to cede my time to him; if any is left, I'll follow up on that point.

    Mr. Holder.

     Thank you very much, Madam Chair.

    First I'd like to thank our guests. I think it's important that you're here. I think the dialogue we're having with you is very helpful to the whole committee. I have great respect for the building and construction trades. I want to acknowledge what you do, because without you, infrastructure funding doesn't matter, frankly. We need you to make it work. Again, thank you.

    I do want to assure you of one thing, just to clarify something. Minister Flaherty has clearly committed that all of the moneys that have been directed to infrastructure funding, subject to the rules that have been put in place, are commitments, and commitments are commitments. There's no sense of reneging on that. I just want to assure you and ask you to assure your colleagues that there's no sense that there's an intention to renege on our commitments.

    I really need to say this. I'd like to offer some empathy, and I mean that from my heart. In my family, people have lost their jobs, in particular my father did one time. People in the trades have lost their jobs, and that's difficult. I think all of us around this table feel a huge empathy for those to whom that has occurred.

    I'm somewhat buoyed, however, by your comments, Mr. Smillie, that you estimate some 34,000 jobs have been created.

    One thing I do want to address--and I think it's something we've talked about--is this timeframe issue, that we have a certain amount of time. I'm always mindful of politicians. I say this having been in the job only fourteen months and three days.

    When I look at this whole thing about timeframes, the thing is if you give us time, we'll take all the time in the world. I guess if there were no priorities established.... Again, this was intended to be stimulus. In other words, it should create an environment in which jobs would be created. If we offered no timelines and if we had said to the municipalities, “Here, take it. Away you go. Do what you do, and let us know how it's going. Come back to us when you can”, do you think there would have been the same sense of stimulus in terms of getting jobs going and projects started if it had been much more casual? I'd be interested in your thoughts on that.

    I know that when my wife gives me a deadline and I don't meet it, there is definite pressure. I know she's watching, so I have to be careful what I say.

    I get your point. My response, with all due respect, would be that if we are going to respect timelines, that's fine, but it's not worth pulling the carpet out from underneath someone standing at the door. I'm not saying that's the intention with the stimulus money or your intention.

    At the same time, with the commitment by the three business partners--the municipality, the province, and the government--it's really important that if something happens along the way, if we're building one of these projects and there's a problem or a redesign by the municipality, or an engineer tells us that a bridge is not going to stand properly, and some of that falls under the time restrictions, we're going to have to take a look at that.

    I think we need to be realistic when we're looking at these major upgrades to sewers or water mains or at things like renovations to universities or to large institutions, and realize that there are going to be delays. As long as we're all respectful of the time commitment and we don't sort of pull the carpet out from under the job, I think that makes some good sense.

    This will be brief, Madam Chair.

    I want to compliment you for saying that the jobs created are skilled first-class jobs. I compliment you on that.

    There was a comment made earlier that perhaps the whole infrastructure funding program was done hastily. Could we afford to wait?

    In my view, without being partisan, action needed to be taken.

    Thank you very much.

    We'll now go to Madam Hall Findlay for five minutes.

     Thank you, Madam Chair.

    I would just say to my colleague that this is the reason that we in opposition did support the budget. Although we had many other reservations, we all—or at least most of us in terms of the opposition—understood the need to move quickly. I appreciate the candour.

    Earlier, one of our colleagues had asked you if you had seen the “Creating Jobs” website, and asked if you could provide your feedback once you've had a chance to take a look. We would love to have your feedback as an entire committee, if that's possible. I will just give you advance warning that the “Creating Jobs” website in fact lists Building Canada fund projects, which are historical and don't relate to the stimulus projects in particular. Those stimulus projects that are listed are once again those that have been announced, not necessarily the ones that have been started. Already we've heard that barely a third of those announced have actually been started, and we don't know how much of that progress has actually been made.

    I would also point out to my colleague who said you had suggested 34,000 jobs were created that this was in fact coming from the Construction Sector Council, not you, and it was, as I made the point earlier, based on numbers that I think are really quite erroneous. We continue to ask the government for actual jobs created. We have not been able to get that information. I would ask you again for your thoughts on that particular website. That would be very helpful.

    My question is this. My colleague says that the minister has promised to make the payments according to the rules. There is no disagreement with that; the problem is with the rules. The problem we continue to point out is with the 2011 timeframe. Under those very rules, of the two-thirds of the projects that have not been started yet, many of them may not actually get started because of the concern of the municipalities ultimately being on the hook. If that were the case, just hypothetically, if one-half of the jobs that have not been started end up not being started, that would be a full third of the projects that have been announced. What would that do to your industries?

    As I mentioned earlier, if the stimulus money doesn't move forward, if I come back in a year, say, to this committee, and I report on work hours again, my forecast would be that work hours would be down significantly, sharp and relentless.

    Perhaps I may make a suggestion. If we feel like the rules are too stringent, maybe Parliament should be working to have the rules amended or worked on. I can't really comment on that. You need to work on it as the government opposition as well as other opposition parties to ensure that it's not at the expense of Canadian workers. At the end of the day, if I come back in nine months and report work hours again without some of these jobs, without the stability that the plan will provide to private industry, the numbers will be down.

    Mr. Cann, I appreciated your earlier intervention about the effect on some of these issues on the long-term workforce and bringing in younger tradespeople and apprentices. Just pulling a number out of the air for the moment, if a half of those, so one-third of the announced projects, actually don't get started, what would that do, from your perspective, to the long-term issue of your concern for bringing in younger people and apprentices for the longer-term future of your industry?

    Again, because I was a training coordinator during the nineties, what happened was we lost a generation, if I can put it that way. We don't have the supervision today. Most of the trades are looking for their leadership again, going back, trying to get more younger people involved. That left a real gap in our demographics.

    What the gentleman here said about the environment.... Our contractors and our clients do a lot of building and moving forward on good faith and on how they perceive things are going to be because it's so long term. That's why it's extremely important that the attitude or feeling that's out there that's put forth by you as the committee and the government is so important to their mindset and how they're going to go about bidding work and creating work and creating jobs, because it takes a long time.

    We will lose apprentices. We'll lose another year or two years where we don't bring young people in. That just creates a whole other cycle. We're trying to plan five to ten years ahead of where we're going to be.

     Monsieur Gourde, five minutes.

    Thank you very much, Madam Chair.

    As you know, under Canada's economic action plan several billions of dollars are being invested. We often hear about the labour shortage. Are certain trade sectors more at risk than others? Could that hinder the implementation of Canada's economic action plan?

    Too often building trades come and go, but if a part of the work cannot be carried out, let's say, for example, that there is a lack of heavy machinery operators or any other specific trade for road infrastructure—will there be major problems in three years? Are you considering taking measures to attract a new generation? Would it be possible to work with industry in order to find a solution? I think that the problem is quite pressing.

    Can we work together to encourage more young people to get into the trades? Absolutely. I'd say we have between 50 and 60 training centres across Canada. We'd be absolutely willing to do outreach to communities and to regular people in those communities who might be interested in coming into the trades. Potentially we could work on some of the things that the red seal department does in HRSDC. We could work on Skills Canada. There are definite ways we could interact with each other.

    Is there a specific trade at risk? I got the note from Mr. Cann, and he said no. At the end of the day, I think it's the trades with a longer training cycle that have a harder time bringing people in. If you have a four- or five-year training period, when you're trying to bring someone up to journeyperson status it's more difficult than a two- or a three-year training period.

    Right now our average age for operating engineers, who range from crane operators to concrete pumps, is around 45 years old. That's our average age. You look at some of our training schools, and I'll take Holyrood, in Newfoundland, we have young men and women there who are willing to get trained on the various equipment, but they need the jobs. If you look at tower crane operators, to get a red seal, I believe Ontario requires 6,000 hours for an apprentice to get to a journeyperson.

    Who's usually the first to go on a job? It's the apprentice. So to get your 6,000 hours takes a very long time. It's a great job if you get to it, but getting to it is the problem in some places. If we lose an apprentice, who may be laid off for four or five months, they need the work and they'll go somewhere else. We will lose them; they won't come back.

    In our sector we have an aging demographic, and we have an issue trying to get some of these apprentices and young people in.

    We could work together on promoting the hiring of apprentices with our contractors. At the end of the day, these folks need a job to get into an apprentice program. If there's one thing we can do to work together, it would be to promote to the contractors and employers in Canada the value of hiring an apprentice. When I pitch the value of an apprentice to a particular contractor, or say I'm meeting with an owner, I always talk about it like this: “An apprentice costs you $20 an hour and you can charge that apprentice out at $55 an hour. A journeyperson costs $50 to $60, and you can only charge them out at $70 an hour.”

    If there's something we could work on, it would be the value of an apprentice program with contractors across Canada. I say hire an apprentice and develop some sort of program that rewards and recognizes contractors who do.

    Merci.

    We're running out of time. Did you have one very quick question? Would the committee indulge Mr. Martin to ask a question?

    Some hon. members: Yes.

    The Chair: Mr. Martin.

    I have one specific question that I should have asked in my first round. Thank you for the chance to get it on the record.

    One of the problems with the apprenticeship system is keeping apprentices, for the reason you mentioned. With my own apprenticeship, it took me seven years to get my carpenter's ticket. Those years of 1980 to 1987 were rough years.

     One of the problems with our EI system is that when you go to school and you're released from your job to do your six weeks at community college, you get the two-week waiting period on EI. I had a family and kids by then. A lot of them say they can't interrupt their income for two weeks, so they pass on their school component. It might be another year before it comes up, or they might be frozen in second year, or they might drop out altogether.

    Is it the position of the building and construction trades department of the AFL-CIO that there should be no waiting period in the community college component when you go on EI as an apprentice?

     If that were proposed, if that were in the bucket, so to speak, we would definitely be supportive of such an initiative. I'd say that right now there are roughly 200,000 apprentices who are sort of in the system. Anything we can do to make sure that the transition between the workplace and school is as seamless as possible would be of assistance.

    I appeared at another committee discussing Bill C-50, regarding the extension of employment insurance benefits, and at a broader level, we made sure that apprentices were not excluded when they do go to school. We didn't get the full monty, so to speak, on the waiting period, but we did make sure that under Bill C-50 apprentices aren't penalized for going to trade school.

     Would we support it? Yes. Is it something that we can definitely work towards? Absolutely. I'd be willing to bring you industry information on that.

    Thank you very much.

    Thank you very much, witnesses, Mr. Smillie, Mr. Cann, and Mr. Schumann, for being here.

    This is the stimulus package study, and we wanted to listen to stakeholders because we wanted to know what was going on, on the ground, and you have given the committee sufficient information. I think the information has been very useful.

     Nobody denies that stimulus funding is important, but this is about the rapidity with which the funding has to go out, so that the problems the construction industry or other stimulus areas are facing should not have to be faced, because it's a two-year deadline. We are looking at what the Parliamentary Budget Officer and the Federation of Canadian Municipalities have said and we will be looking at your recommendations as well, as we go forward with our report.

    We are concerned that the $3 billion that “went out” probably has not gone out--the budget officer hasn't said so--so we will try our best to see what we can do on this side of the House and, together, how we can work.

    Do you have any closing remarks to make before I suspend the committee?

    The only remark I would make is that we are a willing partner, and anything we can do to assist anyone on the committee, we're willing to do. We can go to training centres. We can meet people who are actually doing stimulus jobs down the road. We can see people who may not have access to stimulus funds, to be fair to everyone on the committee, but at the end of the day, I pledge on behalf of the organizations I represent that we're an open book and we'll work with anyone.

    Thank you very much.

    The committee is suspended for one minute.

    [Proceedings continue in camera]