The value of a highly skilled workforce cannot be overstated by Canadian businesses. In a recent survey of 803 managers across Canada, respondents said the most pressing challenge that their company faces is attracting or retaining skilled labour, with nearly 60 per cent of survey participants agreeing on this issue. When asked what incentives would motivate their firm to provide more training, 72 per cent of respondents requested direct funds to support training, as opposed to lower payroll taxes or training programs provided by the government.
The Canadian federal government and provincial governments are helping this issue and spurring workforce development by creating government incentive programs to promote and subsidize training for employees. Programs vary in focus, from formal third party training, to internal training and apprenticeship training. Training improves more than just an individual's skill set. Businesses that invest in it will observe improved morale, employee retention, and employee engagement. By promoting and offering training opportunities to its employees, a business can set itself up to stay competitive, minimize turnover, and encourage strategic thinking. A business's most valuable resource is not its software or machines; human resources should be maintained and developed if the business is to do the same.
The following training incentives are currently available to Canadian businesses.
Canada Job Grant
The Canada Job Grant (CJG) is a six-year training grant available across Canada. From 2014 to 2020, businesses can apply for their provincial variant of the program (ie. Canada-Ontario Job Grant) to cover up to 66 per cent of third-party training costs to advance the skillset and employability of their workforce. There is a maximum of $10,000 in grant funding per trainee, but no overall cap on the number of trainees that can receive CJG grants. Trainees involved in a CJG funded training initiative should receive a wage increase, a new job title, an avoidance of job loss, or be a newly hired employee. This program is open to incorporated Canadian businesses of all sizes, and most provinces have an active variant that you can apply under right now, excluding Québec (which has its own programs).
FedDev Ontario Productivity Training Incentive (Ontario)
FedDev Ontario has dedicated funding to established Ontario manufacturers looking to carry out in-house or third-party training projects that will lead to improved productivity and export sales performance. Up to $50,000 in non-repayable funding, with conditions, is available based on the business's training topics, timelines, and budget. When the program is open, intake is typically continuous. When there are no funds available, applications will be placed on a waiting list.
Apprenticeship Job Creation Tax Credit
The Apprenticeship Job Creation Tax Credit is specific to Red Seal Trades and provides a non-refundable tax credit of up to 10 per cent of the eligible wages to a maximum of $2,000 per year for each apprentice for the first two years of their apprenticeship. Businesses across Canada can claim any unused credit back three years and forward 20 years.
Apprenticeship Training Tax Credit (Ontario)
Ontario businesses can also receive a tax credit through the Apprenticeship Training Tax Credit, which covers up to 25 per cent of eligible expenses (or 30 per cent for small businesses) to a maximum of $5,000 per year for each apprenticeship and $15,000 over a 36-month period. The Ontario government offers a list of eligible skilled trades that are eligible for this program, so make sure to check these before applying.
British Columbia Training Tax Credit
The British Columbia provincial government has launched the Training Tax Credit to subsidize eligible apprenticeship programs administered through the Industry Training Authority (ITA). The program launched on January 1, 2007 and is effective through to December 31, 2017 and covers basic credit and completion credit for non-Red Seal training programs, as well as enhanced credit for First Nations individuals and persons with disabilities. Tax credit amounts vary based on the type of apprenticeship and costs, so make sure to check the Training Tax Credit for Employer Webpage for more information.
Chris Casemore is the director of client management and development at Mentor Works Ltd., specializing in strategic planning through customized funding approaches. Mentor Works has helped hundreds of businesses across Canada discover and leverage Canadian business funding to optimize their growth plans.