Ontario's manufacturing sector continues to grapple with a shortage of skilled trades despite a marked decline in reported job vacancies, according to a new industry report from the Canadian Manufacturers and Exporters (CME).
Mismatch between training and industry needs
The association's review, built from roundtable discussions with manufacturers and educators across the province, finds a weak alignment between how people are trained and the skills firms require. Small and medium-sized manufacturers, which make up much of Ontario's manufacturing fabric, appear particularly exposed because they lack the capacity to absorb the disruption.
“Manufacturers are still struggling to find people that they need with the kind of skills they need,” CME president and CEO Dennis Darby told reporters. “This really means that we've got to do better to match the demand with how we train and educate and prioritize skilled trades.”
"One of the things we're trying to help evolve is trying to get better linkages between educational institutions and manufacturers and ... doing more to really make that connection earlier."
Where shortages are most acute
Darby said the shortfall is broad-based across the trades, naming priorities that include welders, mechatronics and electrical technicians. The report describes apprenticeship and other training pathways as not keeping pace with the changing technical demands of modern manufacturing.
Industry representatives at the roundtables noted that while headline labour-market indicators have shifted, underlying structural problems remain. Participants argued for earlier and stronger connections between schools, colleges and industry so that students and apprentices gain experience that matches employer needs.
Vacancy numbers decline, but not the concern
On paper, Ontario's manufacturing job vacancy rate has fallen sharply in recent years — from 4.7 per cent in 2022 to 1.7 per cent at the end of last year, the lowest level in more than a decade. The report cautions, however, that the drop does not mean the labour problem has been solved.
| Year | Manufacturing vacancy rate |
|---|---|
| 2022 | 4.7% |
| End of last year | 1.7% |
Darby linked the decline in vacancies in part to temporary labour adjustments resulting from trade tensions between Canada and the United States. He pointed to an estimated 50,000 jobs that have been affected in areas such as steel, aluminium, automotive and fabrication — a figure that reflects layoffs and pauses in production that temporarily narrowed the job gap.
Impacts on smaller employers and communities
Smaller manufacturers said they are less able to weather skill shortages because they typically have limited human-resources capacity and smaller payroll buffers than large multinational firms. In many communities across Ontario, those smaller firms are major employers; persistent skills gaps therefore risk limiting local economic resilience and the ability to scale up when demand returns.
- Skills in short supply include welders, mechatronics technicians and electrical technicians.
- Apprenticeship pathways and educational linkages are considered out of step with modern manufacturing needs.
- Temporary layoffs tied to international trade frictions have reduced vacancy metrics but have not solved structural workforce problems.
What industry leaders are asking for
The CME and manufacturers at the roundtables urged government, educators and employers to pursue closer collaboration that starts earlier in students' education, increases experiential learning opportunities, and modernizes apprenticeship and training to reflect automation and advanced manufacturing technologies.
For policy-makers and training institutions, the report underscores a need to prioritise investments and programming that produce graduates whose skills align with current shop-floor realities. For employers, it reiterates the potential value of on-the-job training partnerships, co-op placements and stronger outreach to schools.
As Ontario balances trade uncertainty and the drive to modernize manufacturing, the challenge will be ensuring labour supply evolves in step with technological change — otherwise, firms could face renewed bottlenecks when production rebounds.
The CME's report does not offer a single solution, but it does make clear that without coordinated action among industry, education and government, the province's manufacturers will continue to find the skilled workers they need in short supply.
— Reporting from across Ontario.
