Jim McGuigan, CPA, CA from PwC Canada joined Coffee Chats with CPABC to discuss the 24th PwC CEO Survey of 337 chief executives across Canada conducted in early 2021.
Amongst the many survey findings of the 2021 PwC CEO Survey, Canadian chief executives expect the global economy to see a robust recovery over the next year and a majority expect to grow their workforce. But for businesses to make the most of this opportunity, they need to rethink the workplace and invest in their employees.
Economic outlook in 2021 up sharply from all-time low in 2020
Leading up to the COVID-19 pandemic, CEO optimism had been on the downtrend. In 2018, 72% of Canadian CEOs believed economic growth would improve over the next year. That number fell to 38% in 2019 and hit an all-time low in 2020, with just 14% of Canadian CEOs expecting global economic growth to improve (the 2020 survey was conducted prior to the COVID-19 pandemic).
That perspective has changed as the global economy continues to rebound from the deep recession of 2020, and has translated into renewed optimism. In the 2021 survey, 72% of Canadian and 78% of BC chief executives believe global economic growth will improve over the next year.
As businesses pivot from navigating the challenges of the pandemic into maximizing opportunities in a growing economy, the survey finds most CEOs plan to expand their workforce but anticipate challenges in doing so.
Finding the right skilled employees a top business challenge in 2021
As we shift from uncertainty to opportunity, six of 10 CEOs expect to increase their headcount in 2021 to support anticipated growth. That number is even higher over the medium-term, with eight out of 10 CEOs expecting an increase in their workforce over the next three years. However, they are finding that there is once again a shortage of labour.
In total, 78% of BC CEOs and 71% of Canadian CEOs are concerned about the availability of key skills in the labour force. Given the limited pool of talent available externally, businesses are increasingly recognizing that they can’t hire their way out of the challenge, and instead need to develop from within. To that end, 75% of Canadian CEOs are planning to spend at least moderately in leadership and talent development over the next three years, their top priority long-term investment.
Creating the workforce of the future
Given the limited supply of labour and changing workplace dynamics, there are three areas where businesses should start (or double down) investing in order to modernize their workplace.
- Develop a workforce strategy. With the shift to remote work, it is important to create a comprehensive strategy that still puts employees at the core of the organization. To both develop and retain employees, the plan should focus on keeping employees motivated and engaged in the new world of work.
- Build a culture that encourages life-long learning. Now more than ever employees are the bedrock of successful businesses, and it is critical for businesses to invest in their talent. Create a workplace culture that encourages staff to continue to find ways to develop new skills and recognizes their achievements to help build an agile and resilient workforce.
- Invest in the employee experience and measure the results. Minimize cumbersome processes or redundant systems that only serve to frustrate employees to ensure a frictionless workplace. By reducing these friction points, businesses can see improved productivity, culture, and greater well-being of employees. By setting targets and measuring outcomes, businesses can see how these investments are performing.
Canadian business leaders have recognized that it is critical to focus on the new world of work and invest in their employees. Given the expectation that the labour market will only continue to tighten as the economy grows, businesses need to look inward and ensure they are creating a workplace that provides them a competitive edge and lets employees grow with the business.
Jim McGuigan, CPA, CA, CBV is the PwC BC Region Managing Partner. He is the leader of the Vancouver Corporate Finance group.