Supporting adaptability for small and medium-sized enterprises

Small and medium-sized enterprises (SMEs) power the majority of Canada’s workforce and are vital to local economies. Yet they face growing challenges in adapting to rapid technological, demographic and environmental change. Limited human resource capacity, financial constraints, and competing operational priorities often make it difficult for SMEs to invest in workforce training, or plan for long-term transformation. 

When employers struggle, workers feel it too

These constraints also impact workers too. Without access to ongoing training and development, many SME employees risk falling behind as new tools and technologies reshape jobs. Smaller firms’ limited HR capacity can also create barriers to more inclusive workplaces, particularly for equity-seeking groups such as women, newcomers, Indigenous and racialized workers, LGBTQ2S+ workers, and workers with disabilities.

A deepening skills gap

As Canada confronts economic uncertainty, automation, and a wave of retirements, skills shortages are widening across sectors. Despite the central role of skills in driving productivity, SME-focused training and workforce development remain underfunded and fragmented compared to other priorities such as financing, innovation, and export development. Better coordination between skills development and broader economic objectives is needed to improve the effectiveness of government programs supporting SMEs.