If Canada’s supply chain managers learned anything from the last five years, it’s that people are as critical to resilience as parts and pallets. From the pandemic-era bottlenecks to more recent trade conflicts and climate shocks, the weakest link in many supply chains has too often been the workforce behind them.
And the workforce puzzle is only getting harder to solve. In Ontario alone, 59% of transportation and warehousing businesses still report workforce shortages, a slight decrease from the record levels seen during the pandemic. Meanwhile, voluntary turnover in Canada stands at 11.9% across all industries, and is even higher in frontline roles that supply chains rely on daily.
Retirement trends are compounding the pressure. Canada’s labor force participation rate dropped to its lowest level in 20 years, reaching just 65% in 2023. Although immigration is easing the decline—with a record 468,817 newcomers arriving in a single year—workforce gaps remain deeply felt in transportation, warehousing, and the skilled trades.
Snapshot: Recent labor trends shaping Canada’s supply chains
● 59% of Ontario transportation and warehousing businesses face workforce shortages, and the same share cite logistics backlogs and higher costs as direct impacts.
● 11.9% average voluntary turnover rate across Canadian industries.
● 42% of Canadian businesses say it’s getting harder to hire or retain critical supply chain roles.
● 65% national labor force participation rate—lowest in two decades.
● 1.5% rise in industry GDP for transportation and warehousing, well below historic growth averages—signaling capacity strain.
● 468,817 immigrants were admitted between July 2022 and July 2023, helping to offset retirements but not closing all gaps.
Strategic adaptations to workforce gaps
Supply chain leaders know they can’t recruit their way out of this puzzle alone. That’s why more companies are redesigning how work itself gets done. In Ontario, for example, transportation firms are piloting flexible seasonal contracts and internal training hubs to attract younger workers and close the skilled trades gap.
Manufacturers and logistics providers are also revisiting old assumptions about where and how work happens. McKinsey’s 2024 survey shows 73% of global companies are expanding dual sourcing and 60% are actively regionalizing supply chains to limit risks from geopolitical shocks and labor shortfalls.
A practical example: Many Canadian firms that once relied heavily on single U.S. trade corridors are now diversifying to tap cross-border partnershipsv with Mexico or nearshore inputs from Asia-Pacific trade partners, balancing costs while guarding against workforce constraints.
How companies are closing labor gaps
● Upskilling and cross-training existing teams
● Piloting flexible, gig-style roles and seasonal models
● Expanding dual or multi-sourcing to limit single points of failure
● Regionalizing or nearshoring parts of the supply chain
● Using predictive analytics to plan capacity and staffing
● Strengthening governance and board-level oversight
Technology as a workforce multiplier
Automation alone isn’t a silver bullet, but when done right, it lets limited people power stretch further. Predictive analytics and AI are now mainstream tools for transportation and logistics planning, with 80% of third-party logistics (3PL) providers and 77% of shippers investing in predictive tools that help them maximize fleet capacity and pre-empt bottlenecks.
Modern transportation management systems, warehouse robotics, and real-time tracking mean that trucks, containers, and storage assets can be deployed more precisely, boosting output without overworking staff. Major logistics players are investing billions to digitize operations, betting big on cloud-based tools, AI, and automated workflows to keep goods moving.
However, tech adoption is changing the skills supply chains need. As Randstad notes, AI-driven logistics and predictive systems require new data fluency and upskilling across all levels of the workforce. Resilient companies aren’t just buying new tools; they’re growing new talent to run them.
Collaboration and governance at the core
Technology and diversification alone won’t close the people gap. Stronger governance and closer collaboration are quickly becoming the new front line in workforce resilience. Canada’s National Supply Chain Task Force has called for better national oversight, clearer data sharing, and more coordinated training to boost domestic capacity and ensure smoother networks.
This means, 63% of manufacturers with robust supply chain partnerships report on-time delivery rates above 95%, even when labor or logistics pinch points hit. Yet, as McKinsey’s 2024 survey shows, only 25% of companies discuss supply chain risks at the board level, leaving dangerous blind spots that could undermine good strategies when it matters most.
Industry-wide and cross-border collaboration, like shared training standards or talent pipelines, can help Canadian firms stay competitive when labor tightens again. For boards, strengthening oversight now is a must.
A new era for labor resilience
Labor volatility isn’t a short-term glitch; it’s an ongoing test of supply chain leadership. Companies that treat it as a catalyst for smart strategy, sharper tools, and stronger collaboration will be ready for the next disruption, not just reacting to the last one.
Canada’s supply chain leaders have a choice: keep chasing workers they can’t find, or build resilient networks that turn workforce gaps into opportunities for reinvention. The puzzle won’t solve itself, but the pieces are already on the table.
