A noncompetitive streak

Skills shortages, an overly complex tax system and other barriers are holding Canada back when it comes to competitiveness, says a recent report.

Canada is stagnating when it comes to competitiveness, according to a February report by the Canadian Chamber of Commerce.

Top 10 Barriers to Competitiveness 2014 points to a number of barriers that are holding Canada back. They include:

Skills shortages

A demographic shift is taking place, which is resulting in retirements and a growing gap between the skills needed and those available. Business, governments and academia must work together to address current and future needs of the workplace, focusing on four key areas: upskilling, education and employment connections, immigration, and Aboriginal workforce development.

Uncompetitive travel and tourism strategies

Canada "is too often a high-cost, high-hassle destination with aging attractions infrastructure and inadequate marketing," says the report. "[T]he government must invest in national marketing initiatives and address Canada's inefficient visa system, the very high cost of air travel in Canada and its layers of regulations, fees and taxes."

Inadequate plans for addressing deficiencies in public infrastructure

There has not been enough public investment in infrastructure to keep up with Canada's economic needs. Bringing infrastructure in Canada back to the level needed to support prosperity requires, among other things, an ongoing commitment by all levels of government.

Barriers to success in global markets

Canadian businesses are not globalizing as quickly as their OECD peers, largely because of policy and regulatory barriers and operating challenges in foreign markets. Among other initiatives, Canada must successfully negotiate trade agreements with key markets and renew its commitment to trade promotion.

Internal barriers to trade

The national economy is fractured by a host of nontariff barriers. The federal government must support jurisdictions that embrace free internal trade and promote sanctions against those that do not.

A complex and costly tax system

Canada overrelies on income and profit taxes rather than on taxes on consumption, which are relatively easy to collect and are least harmful to growth. A comprehensive review of Canada's tax system should be undertaken.

Lack of clear sustainability policies

Public concerns over Canada's ability to responsibly develop its natural resources has led to project delays, constrained investment and limited access to some foreign markets.

Shortage of economic development tools for businesses in Canada's territories

The federal government must decide whether to provide the territories with tools to become more financially independent in the belief that doing so will unleash their ability to help the entire country be more competitive.

Inconsistent regulatory policies between Canada and the US

Regulatory inconsistencies cost time and money. Greater alignment in regulatory approaches would energize supply chains and facilitate cross-border trade, among other benefits.

Insufficient support for innovation in Canadian manufacturing

Canadian manufacturing has not recovered from the 2008 recession. Companies must innovate to capitalize on new technology and processes that improve productivity in order to remain competitive.