They hand it over to a local debt collector agency or whatever the local procedures are. Maybe they call the bank and take it out of the persons next pay check.

I disagree that it is a jobs issue. It is a legal issue and what procedures exist for these situations.

The debt gets sold to local companies that can attempt to enforce it in that province/town, probably for cents on the dollar. It probably gets sold to an aggregate and then collectors bid on it.

Not too different than what happens anywhere in the world.