![\"CANADA-HOLIDAY-HISTORY\"](\"https:\/\/www.europesays.com\/canada\/wp-content\/uploads\/2026\/06\/78761bc26ec654464b8977e690331769.jpeg\")
A Canadian flag flies during the Canada Day Celebrations in the Old Port in Montreal, Que. (Credit: ANDREJ IVANOV\/AFP via Getty Images files) <\/p>\n A Canadian flag flies during the Canada Day Celebrations in the Old Port in Montreal, Que. (Credit: ANDREJ IVANOV\/AFP via Getty Images files) <\/p>\n
Canada\u2019s Defence Industrial Strategy is the most ambitious industrial policy this country has produced in a generation. The numbers are striking: $180 billion in domestic defence procurement, a projected 240 per cent increase in industry revenues, 125,000 new jobs and more than half-a-trillion dollars in total economic activity by 2035. The government has been explicit that this is not simply a defence plan \u2014 it is an economic transformation, a deliberate effort to build a sovereign industrial base capable of sustaining Canadian security without chronic dependence on foreign suppliers. The strategic logic is sound. The sequencing, however, contains a risk that deserves more attention than it has received.<\/p>\n
Canada will spend the money. That much is not seriously in question. Defence<\/a> budgets have been committed, NATO<\/a> obligations are being met and the procurement pipeline is beginning to move. The real question \u2014 the one the DIS has not yet answered \u2014 is whether that spending builds the sovereign industrial capacity the strategy promises, or whether it quietly reverts to the path of least resistance: buying capability from allies, primarily the United States, with Canadian industrial participation as an afterthought.<\/p>\n That reversion is entirely possible. And the mechanism by which it happens is not procurement failure or political will. It is a workforce gap that the strategy has acknowledged but not yet solved.<\/p>\n The 125,000 jobs<\/a> figure is the DIS\u2019s most visible economic promise. It appears in budget documents, ministerial speeches and industry communications as a settled outcome. It is, in fact, a projection \u2014 and one that lacks the analytical scaffolding needed to make it credible.<\/p>\n The government\u2019s own State of Canada\u2019s Defence Industry report for 2026 puts the total defence sector economic impact at 81,800 jobs, blending direct employment of roughly 36,000 with indirect and induced effects.<\/p>\n It is not publicly clear whether the 125,000 represents net new positions above that blended baseline, direct jobs only, or a further aggregate. No public document breaks the target down by occupation, skill level, timeline, or region. There is no published gap analysis comparing today\u2019s workforce to what the DIS\u2019s ten sovereign capability areas will actually require.<\/p>\n This matters for a simple reason: Without a defined workforce requirement, the Canada Defence Skills Agenda \u2014 the $383 million program meant to build that workforce \u2014 is investing without a plan. Good intentions and real dollars are not a substitute for a rigorous labour market needs assessment that tells industry, provinces and training institutions what to build toward and when. That assessment should exist, should be independent and should be updated annually.<\/p>\n Story Continues <\/p>\n Ottawa\u2019s Spring Economic Update 2026 acknowledges a structural shortage of more than 20,000 skilled trades workers annually. The government\u2019s response, Team Canada Strong targeting 80,000 to 100,000 new Red Seal tradespeople by 2030-31, lists defence as one of four priorities alongside housing, infrastructure and resource development.<\/p>\n That is a crowded queue. All four sectors will compete for the same apprentices, the same instructors and the same provincial training capacity. And on current terms, defence is not well-positioned to win that competition. Housing and infrastructure offer simpler entry, faster clearances and more familiar career pathways. The apprenticeship system is already losing ground: fewer than 34,000 of 100,000 new registrants completed in 2024. Adding more entrants to a pipeline with a two-thirds attrition rate does not solve the problem.<\/p>\n If the defence industrial base cannot secure its share of the trades workforce, the most capital-intensive programs in the DIS \u2014 shipbuilding, ammunition production, armoured vehicle manufacturing \u2014 will face the same execution risk that has plagued Canadian defence programs for decades: not a lack of money or political commitment, but a shortage of people qualified and available to do the work. The result is schedule slippage, cost escalation and ultimately a return to foreign procurement to fill the gap.<\/p>\n A dedicated defence-sector stream within the trades pipeline \u2014 with ring-fenced capacity, curriculum aligned to sovereign capability requirements and structured employer commitments \u2014 is not a luxury. It is the mechanism by which the DIS\u2019s industrial ambition becomes executable.<\/p>\n The DIS leans heavily on small and medium-sized businesses<\/a> as the engine of industrial growth \u2014 and rightly so. SMBs represent more than 90 per cent of firms in the Canadian defence sector. They are also the most exposed to workforce gaps and the least equipped to absorb them.<\/p>\n A prime contractor can carry cleared staff between contracts, offer competitive salaries and maintain HR infrastructure capable of navigating complex training systems. An SMB typically cannot. When skilled workers are scarce, they flow toward larger, more stable employers \u2014 which means the supply chain depth the DIS requires may never fully develop, regardless of how much capital is directed at it. Workforce scarcity at the SMB level doesn\u2019t show up as a single visible failure; it shows up as chronic underperformance against industrial targets, program delays and a slow drift back toward foreign subcontracting. It is the quiet risk inside the quiet risk.<\/p>\n The most promising structural response lies in dual and multi-use technology firms \u2014 companies operating simultaneously in commercial and defence markets. This is where Canada has genuine and underexploited competitive advantage. Dual-use firms in areas like AI, quantum, autonomous systems, advanced sensors and cybersecurity are growing organically, attract engineering and technology talent without requiring workers to self-identify as defence industry and produce capabilities with applications across both civilian and military domains. Critically, their commercial revenue base provides the financial stability that pure-play defence SMBs rarely achieve.<\/p>\n A workforce incentive framework that explicitly prioritizes dual-use firms \u2014 through targeted R&D tax credits, preferential access to Skills Agenda funding, apprenticeship wage subsidies calibrated to technology roles, and streamlined access to defence procurement \u2014 would do two things at once: grow the industrial capacity the DIS needs and build it on a foundation commercially sustainable enough to survive the inevitable gaps between defence contracts. It would also accelerate the development of exactly the sovereign capability areas \u2014 digital systems, AI<\/a>, quantum, space \u2014 that the strategy identifies as priorities but has done the least to staff. Security clearance timelines, administrative portability between contractors, and pre-clearance pathways for students in designated programs are also part of the solution \u2014 but they are implementation details within a larger structural problem that starts with how the government defines and incentivizes the industrial base it is trying to build.<\/p>\n Canada has a long and expensive history of defence procurement that generated less domestic industrial benefit than promised. The NSS has made genuine progress; other programs less so. The DIS is a sincere attempt to break that pattern \u2014 to use the defence budget as a deliberate instrument of industrial development rather than simply a means of equipping the military.<\/p>\n But industrial development requires workers. Sovereign capability requires people with the right skills, the right clearances, and a reason to build their careers in this sector rather than another. Without the workforce foundation in place, the money will still get spent. The equipment will still get procured. The question is simply whether it gets built here, by Canadians, in facilities that will still be operating in 2045 \u2014 or whether the path of least resistance quietly wins again.<\/p>\n That is the risk. And it is one the government still has time to address, but the clock is ticking.<\/p>\n Mark Norman is a retired vice-admiral who commanded Canada\u2019s Navy and was vice-chief of defence. He advises several Canadian defence companies.<\/p>\n","protected":false},"excerpt":{"rendered":"A Canadian flag flies during the Canada Day Celebrations in the Old Port in Montreal, Que. 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