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Canada's Job Grant and What It Means for BC Employers

BC employers and the Canada Job GrantIn 2013, the federal government announced the creation of the Canada Job Grant, which would fund apprenticeships, skills training, continuing education and other supportive measures with the help of employers. The employer funds the training for up to $5,000, and the federal government then provides up to $10,000.
But what are the chances that employers in BC, Alberta, Saskatchewan and the rest of the country would be willing to make such an investment when businesses only invest $705 per year on average in training for their existing workforce?
To answer that, we can look at what we are currently doing with the money for the Canada Job Grant. It is essentially Employment Insurance money that goes into existing employment-related programs funded by the government. These programs include employability and skills coaching, such as those delivered through Royal Roads, entrepreneurship programs through Community Futures and wage subsidy programs for those coming off of unemployment.

How we all benefit

These government-funded programs cost millions of dollars to deliver across the country, and the results can be difficult to measure. I was fortunate to benefit from one of them in 2004: the Entrepreneurship program. It helped me build the business plan for Red Seal.
As a result of this government-funded program, Red Seal now directly employs a dozen people in Victoria and indirectly funds employment through its Victoria suppliers. But most importantly, it helps hundreds of people find employment across the country.
Red Seal’s tax contributions through payroll taxes, GST, PST, property and corporate taxes have paid off the government’s investment in the Entrepreneurship program hundreds if not thousands of times over. Through tough negotiations by the provinces, the Canada Job Grant will likely continue to support several of job creation programs, including entrepreneurship.

But, will businesses invest?

But back to our original question: will employers in Canada be willing invest $5000 into the training of an unemployed Canadian? As a business owner, the answer is: only if the investment is in wages paid to the employee while learning on the job.
Let’s look at an example. If the program delivers $5,000 in funding for training such as a pre-apprenticeships Industrial Electrician course at a college,

  • The employer pays $5,000, or half in the apprentices employees’ wages, for the first 4 months of employment. $14.71 per hour x 170 hours per month at $2,500 per month
  • The government pays other $5,000 in salary in the form of a grant.

Really, what this looks like is an enlargement of the Federal Apprenticeship Tax Credits and Apprenticeship grant that is already in place and has been very welcome by trades employers across the country. Can this model transfer to other professions and industries? Only time will tell.

More information

http://www.servicecanada.gc.ca/eng/goc/apprenticeship/incentivegrant/program.shtml
http://www.conferenceboard.ca/topics/education/commentaries/14-03-20/developing_skills_where_are_canada_s_employers.aspx
http://www.newsroom.gov.bc.ca/2014/03/governments-of-canada-and-british-columbia-take-action-to-create-jobs.html

Current Grants

http://www.workbc.ca/Employers/Start-your-business/Funding/Explore-Loans,-Grants-and-Funding.aspx
http://www.communityfutures.ca/business-programs

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