December 17th, 2015
After a long reign as one of Canada’s economic powerhouses, Alberta’s economy has suffered in recent years. The new NDP government, headed up by Premier Rachel Notley, has announced a job creation tax initiative to help employers expand their workforce, even while they weather the current financial downturn.
Known as the Job Creation Incentive Program, the $178 million enterprise commences on January 1, 2016. The hope is to add many new permanent positions and further diversify an economy that has long relied on the energy industry to provide the majority of its revenue. Employment statics underline the need for a change in course: Alberta shed 14,000 jobs in February 2015 alone, and current projections show the province’s unemployment rate increasing throughout 2016.
Goals of the Program
When the economy is in decline, employers naturally cut back on hiring and may even trim their workforce. Neither of these actions benefit the province and simply help to perpetuate the economic gloom. The Notley government hopes to buck that trend with this government funding for business incentive, which aims to help generate up to 27,000 new jobs over a two-year period. Positions created before January 1, 2016 are not eligible and neither are organizations the Alberta government oversees, such as schools or hospitals.
The oil industry has been the mainstay of Alberta’s economy, providing as much as 24% of the government’s yearly budget. The recent decline in crude prices has sparked an urgent need for greater expansion of industry in order to make up the shortfall. The program’s overall goal of supporting job creation and stimulating the economy expects to elicit a stronger performance from promising non-energy sectors, such as healthcare technologies, transportation, and analytics. Renewable energy is also an area where provincial expansion could prove transformative.
Outside investment is a further way to bolster an economy, and one that is encouraged by an active and confident business community. If industries respond well to the government’s financial enticement, the plan is to extend the initiative.
Creating new full-time positions is the goal, and organizations will receive $5,000 for each one created. Firms that apply first will receive priority, but the program is open to corporations of all sizes as well as charities and non-profits. Every employer has the opportunity to receive as many as 100 of these grants, totaling $500,000. Participating companies must supply the government with their insurable-earnings data as a way of confirming the new job roles.
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