Identifying Needs and Opportunities for Small- and Medium-Sized Enterprises


Executive Summary



Social Enterprise for Canada has undertaken research to investigate key barriers faced by small- and medium-sized enterprises (SMEs) in the hiring of internationally educated professionals (IEPs). SMEs comprise the majority of the Canadian and local economy, and data indicates that skilled immigrants are not being hired by many smaller organizations. Skilled immigrants often encounter additional barriers when trying to integrate into the Canadian labour market, and this is reflected in their higher rates of unemployment and under-employment than the Canadian-born/trained population.

The goal of this report is to draw attention to the needs of SMEs, as well as tools and strategies that can improve the understanding of foreign credential recognition and experience, thereby enhancing the labour market integration of new immigrants in York Region and Toronto. A range of SMEs in York Region and Toronto were consulted through focus groups, one-on-one interviews and surveys. Through this process, valuable insight about various barriers, needs, tools and strategies from the perspective of small- and medium-sized employers in York Region and Toronto was garnered.



The demographic profile of York Region and Toronto is changing significantly. Approximately one-third of the region’s population is part of the “baby boomer” generation and is expected to retire in the coming years. As these individuals retire, the demand for talent will be an increasingly significant issue for businesses. In addition, the increased mobility of the workforce, combined with the decline in Canadian birth rate, will lead to a supply-demand imbalance of labour. The Conference Board of Canada estimates that the under-utilization of immigrant skills is costing the Canadian economy $3.42 billion to $4.97 billion annually. The economic outcomes of immigrants and their children will continue to be a major policy concern in Canada. Immigrants are vital in replenishing the aging Canadian workforce and contribute significantly to a robust and growing economy. Skilled immigrants have many valuable skills to offer Canadian businesses; however, employers often find understanding foreign education and work experience challenging. Employers may have difficulty determining whether individuals trained abroad have the specific skills or competencies required to do particular jobs.

Immigrants are significantly more unemployed than the Canadian-born. In October 2010, the unemployment rate for the Canadian-born in the Toronto Census Metropolitan Area was 5.3%, compared to 10.7% for all immigrants. While new immigrants have had higher unemployment rates than the Canadian-born in the past, the gap has widened since the recession beginning in 2008. Equally important is the fact that new immigrants are significantly more under-employed than the Canadian-born. For example, recent immigrants who came to Canada with a university degree had a median income of $24,636 in 2005, compared to the median income of $51,656 for people who were born in Canada and who have a university degree. Immigrants who had been in Canada for more than five years came out in the middle – with a median income of $36,451 for those with a university degree.


Key findings – Views from Employers


  • Communication issues, particularly relating to language, were reported to be the most significant barrier with regard to the hiring of IEPs in SMEs. Furthermore, recognition of foreign credentials/uncertainty about foreign standards was commonly mentioned, as were cultural differences, prejudice and stereotyping. The time and resources needed to bridge/re-qualify newcomers was also mentioned as a significant issue.

  • SMEs often have trouble verifying education and work experiences gained abroad.

  • The vast majority of SMEs have not started to plan for demographic changes in the workforce and many lack awareness about how these changes will impact their business moving forward.

  • A significant proportion of SMEs perceive more risk in hiring IEPs.

  • Assistance with language training and competency assessment were seen by employers to be most valuable in the recruitment, training and retention of IEPs. Many SMEs lack knowledge about the availability of these services and how to access them. Awareness about the agencies and resources that can provide assistance was generally low.

  • Many SMEs expressed interest in resources to help them hire IEPs, such as a list of IEP portfolios including their foreign credential assessment and validation of education and experiences abroad, as well as an evaluation of IEP candidates – to match their skills with those that local businesses require and can tap into. Generally, free/low-cost job posting boards and a resume database were seen to be of value. Also valued were information about foreign credential recognition, help navigating existing resources and services, and assistance verifying education and work experience gained abroad.

  • Informal hiring methods are commonly used by SMEs.

  • Participants noted that there are services and resources to help immigrants integrate into the workforce (though it is not necessarily easy to navigate these services) but there are few resources to help employers in the hiring of new immigrants.


Recommendations for Social Enterprise for Canada

Our research indicates that many SMEs would find significant value in knowing about and being able to easily access tools online – in a one-stop repository – to help them hire and retain internationally trained/educated professionals. Due to technological advancement and time constraints for many SMEs, web-based toolkits are effective for businesses to access the resources they need for their hiring and talent management purposes. Social Enterprise for Canada will highlight and offer online tools to help employers with their hiring processes and retention strategies. This will be done through a website that will be available for public access beginning in December, 2011. Some of the key areas of focus are:

  • changing perceptions among SMEs –

    • by identifying the advantages of hiring IEPs and providing information about the importance of planning for the future to prepare for impending skills shortages

  • helping SMEs implement effective human resources practices –

    • by providing information about and access to tools for culturally sensitive human resources practices, providing competency-based tools for workforce management, and promoting the creation of standards/benchmarks for competency requirements for positions

  • assisting with foreign credential and experience issues –

    • by providing information regarding the assessment and recognition of foreign credentials and experience, highlighting what sector councils and professional bodies are offering, and promoting the internal setting of benchmarks based on competencies to support and enhance the understanding of foreign education and work experience

  • minimizing employment barriers related to language proficiency –

    • by providing information and access to resources regarding cross-cultural interviewing and occupation-specific language assessment and skills training

  • assisting with reference checks –

    • by providing online resources and information about external services for assistance

  • assisting with integration of cultural diversity –

    • by highlighting cultural diversity integration programs, and providing resources to help enhance leadership and high performance within a culturally diverse workforce

A featured strategy on the website will involve a competency-based approach to defining job and work requirements.

  • Competency-based assessment can:

    • help businesses to attract and foster the behaviours and skills needed to achieve success and sustainability

    • help businesses hire the most qualified individual for the job from their pool of candidates

    • help businesses more easily assess the skills of internationally educated/trained professionals, which can widen the pool of qualified candidates

    • decrease costs of employee turnover, by helping businesses to hire the right fit the first time

    • help businesses identify their workforce skills gaps, so that training can be targeted, efficient, and cost-effective

Competency-based assessment tools can assist businesses in understanding candidates’ foreign education and work experiences, including those gained abroad, and help identify whether specific credentials translate to particular technical skills necessary for the job. Competency-based assessment can also help businesses evaluate candidates’ interpersonal skills, such as communication and teaming skills, in a more objective manner.

Research report

Immigrant Labour Market Integration in York Region and Toronto

Identifying Needs and Opportunities for Small- and Medium-Sized Enterprises

Contact Info

Think Talent, Think Global

17705 Leslie Street, Unit 11, Newmarket, ON Canada