The Canadian automotive industry continues to enjoy rapid evolutionary growth. As reported in a Government of Canada report entitled Canadian automotive industry, the sector remains crucial to Canada’s economy, delivering a $12.5 billion contribution to GDP in 2020. 

One of Canada’s largest manufacturing sectors, according to the most recent available data from FOCAL, the industry directly supports 188,000 jobs in automotive production, and an additional 22,000 jobs in automotive research and technology. But, as the Canadian automotive industry report goes on to state, there are “an additional 371,400 people in aftermarket services and dealership networks.” All this adds up to a truly massive industry presence.

The FOCAL Initiative

Helping drive this evolving automotive industry growth is the FOCAL initiative, a collaboration between the Canadian Skills Training and Employment Coalition (CSTEC), the Automotive Policy Research Centre (APRC) and Prism Economics and Analysis. FOCAL stakeholders (past and current) include Ford, Honda, General Motors, Toyota, Magna, Woodbridge Group, Martinrea, UNIFOR, Algoma Steel, Blue Solutions, CVMA,  APMA, CAMM, Automate Canada and Trillium Network for Advanced Manufacturing as well as representatives from all levels of government. The entire auto supply chain, led by the vehicle companies, automotive component suppliers and industry leading association groups, is a part of this initiative. FOCAL is funded by the Government of Canada.

Understanding Industry 4.0

As we all know, the Canadian automotive industry has been significantly impacted by the digitization of manufacturing, widely referred to as Industry 4.0. The term Industry 4.0 stands for the fourth stage of the industrial revolution.

• The first industrial revolution involved mechanisation through water and steam power.
• The second industrial revolution brought forth the use of electricity to enable mass production through the creation of assembly lines.
• The third industrial revolution was initiated by the advent of computers and automation.
• The fourth industrial revolution is driven by the introduction of smart and autonomous systems fueled by big data and machine learning.

Significant but manageable impacts

The FOCAL initiative has concluded that Industry 4.0 technologies will have significant but manageable impacts on Canada’s automotive sector, especially as that shift affects current employment levels and future hiring practices. Specifically, we project that:

• 80% of tasks performed by production occupations will be affected through the partial or full elimination of certain tasks.
• 50% of skilled trades tasks will be equally affected.
• The industry will also be affected by the creation of new jobs and titles reflecting the increased requirements for digital skills.

An industry in transition

It is important to recognize that being affected doesn’t mean being eliminated. The industry is going through a transition period that is temporary. Technology and technological innovation have for decades been fundamental to the development and production of motor vehicles by Canada’s automotive industry. Nothing’s changed.

If anything, the importance of automotive technology—particularly as it’s influenced by the consequences of digitization—has grown in recent years as investments in new areas of innovation, such as electric and autonomous vehicles and digitization, are impacting traditional aspects of transportation.  

An upbeat analysis

The Future Skills Centre, a Toronto-based pan-Canadian initiative with close connections with The Conference Board of Canada, recently published a briefing called Rising Skills: Digital Skills Needs for Smart and Connected Vehicles.

The briefing is upbeat. It recognizes that even though the automotive industry shift toward smart and connected vehicles is affecting automotive manufacturers and its component suppliers, the opportunities for training and upskilling have rarely been greater. Specifically, the briefing states: “Automotive tradespeople are grappling with future work challenges related to connected, autonomous, shared, and electric (CASE) vehicles. Automotive service technicians, auto body and collision technicians, heavy-duty equipment technicians, truck and transport mechanics, and other tradespeople need technical, problem-solving, communication, and other 21st-century digital skills to thrive in response to these trends.”

FOCAL and the future

And that’s where the FOCAL Initiative comes in. The specific objectives of the FOCAL Initiative are detailed in this post. An important note: evidence from studies of labour mobility suggests highly skilled workers, such as those sought after by automotive technology employers, are also highly mobile workers, with a willingness to move commanding strong wage premiums for their specialised abilities.

Follow us to stay informed

This all adds up to a positive overall story for the Canadian automotive industry. Although it remains true that some employment segments in our industry face barriers to upskilling—including financial constraints, tech challenges, and age-related tensions—we are working with employers to confront and manage them.

While not minimizing these challenges, the FOCAL team is fully resourced to support industry leaders as they confront and overcome them. There’s plenty of work to be done, but the future looks exciting and, crucially, full of opportunity for employment and continued growth in one of the most dynamic sectors of the Canadian economy. 

Follow FOCAL on LinkedIn, Facebook, Twitter and Instagram to stay informed and gain access to resources, special events and—perhaps most importantly—funding opportunities for employers. Share this blog with your professional networks to keep them up to date with these opportunities for automotive industry staff and employers. 

The FOCAL team welcomes your questions, concerns and feedback. The FOCAL Initiative is a collaborative enterprise, so please contact us at your convenience.