Yesterday’s budget release a mixed bag for employers
The Federal Budget, released yesterday, held few surprises but was a mixed bag for employers. Steps to reduce the skills gap and improve employment prospects in certain industries will be welcomed, but many were hoping to see specific reductions in EI and tax costs.
Federal Jobs Grant
The grant, which was introduced in last year’s budget, has been criticized by provinces and some interest groups for reducing provincial budgets and overlooking vulnerable groups. The 2014 budget confirms the program will go ahead, with Employment Minister Jason Kenney trying to stem provincial concerns by confirming the federal government would cover two-thirds of the training costs. The remaining third is to be covered by the employer.
The 2014 budget says the grant “will encourage greater employment participation in skills training decisions and ensure that training is better aligned with job opportunities, particularly in sectors facing skills mismatches and labour shortages.”
Training underemployed groups
The budget allows for more than $25 million to support the employment of people with intellectual disabilities. This includes $15 million over three years for the Canadian Association for Community Living’s Ready, Willing and Able initiative, which encourages employers to hire youth and working-age people with developmental disabilities.
“The assumption is you graduate high school and you go on welfare. That’s the trajectory for people with intellectual disabilities in this country,” said Michael Bach, the executive vice-president of CACL, adding that the federal funding will help connect another 1,200 people with jobs over the next three years.
On page two: more money to reduce the skills gap
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It will also provide $11.4 million over four years to support vocational training for Canadians with Autism Spectrum Disorder, in a joint initiative with the Sinneave Family Foundation and Autism Speaks Canada to help approximately 1,200 youth a year at vocational training centres across Canada.
Matching staff to skills
The government is hoping funding will help solve the skills gap and high unemployment rate with a range of other funding committed to job training including:
$100 million in interest-free loans for apprentice programs
$75 million over three years to expand the Targeted Initiative for Older Workers program, to help unemployed older Canadians in smaller communities find jobs.
$40 million for the Canada Accelerator and Incubator Program for entrepreneurs creating new businesses.
$40 million over two years for up to 3,000 internship positions in “high-demand fields.”
Driving growth in key industries
The budget proposed to provide an additional $500 million over two years to the Automotive Innovation Fund to support new strategic research and development projects. It also plans to move forward with planning and construction on a new Windsor-Detroit International Crossing.
These and other initiatives were aimed at boosting growth in some of Canada’s key industries, some of which have been slow or stagnant since the 2008 recession.
On page three: welcome changes for small businesses
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Increased payroll remittances thresholds:
Currently, every employer with an average monthly withholding amount (AMWA) of $15,000 is classified as an accelerated remitter. As well, employers with a $50,000 AMWA are required to remit bi-weekly. Budget 2014 proposes the introduction of increased thresholds for accelerated remitters to $25,000 (from $15,000) and to $100,000 (from $50,000). The Department of Finance has estimated that 50,000 employers will see their required number of remittances cut in half.
“Increased thresholds for accelerated remitters will lower administration costs for some employers that were previously required to remit on a more frequent basis,” said Patrick Culhane, President and CEO of the Canadian Payroll Association. “The world has changed dramatically since 1990 and a payroll of $50,000 per month is no longer a large business.”
EI premium freeze
The budget would freeze the EI premium rate at the 2013 level of $1.88 per $100 of insurable earnings. This was a good start, according to the Canadian Federation of Independent Business, but the group had hoped the government would go further and start reducing EI premiums for small businesses.
CFIB president Dan Kelly said he was disappointed by the elimination of the EI hiring credit for small business.
“We urge government to move quickly to reduce EI premiums as soon as the account is back in balance,” Kelly said.
Federal Jobs Grant
The grant, which was introduced in last year’s budget, has been criticized by provinces and some interest groups for reducing provincial budgets and overlooking vulnerable groups. The 2014 budget confirms the program will go ahead, with Employment Minister Jason Kenney trying to stem provincial concerns by confirming the federal government would cover two-thirds of the training costs. The remaining third is to be covered by the employer.
The 2014 budget says the grant “will encourage greater employment participation in skills training decisions and ensure that training is better aligned with job opportunities, particularly in sectors facing skills mismatches and labour shortages.”
Training underemployed groups
The budget allows for more than $25 million to support the employment of people with intellectual disabilities. This includes $15 million over three years for the Canadian Association for Community Living’s Ready, Willing and Able initiative, which encourages employers to hire youth and working-age people with developmental disabilities.
“The assumption is you graduate high school and you go on welfare. That’s the trajectory for people with intellectual disabilities in this country,” said Michael Bach, the executive vice-president of CACL, adding that the federal funding will help connect another 1,200 people with jobs over the next three years.
On page two: more money to reduce the skills gap
#pb#
It will also provide $11.4 million over four years to support vocational training for Canadians with Autism Spectrum Disorder, in a joint initiative with the Sinneave Family Foundation and Autism Speaks Canada to help approximately 1,200 youth a year at vocational training centres across Canada.
Matching staff to skills
The government is hoping funding will help solve the skills gap and high unemployment rate with a range of other funding committed to job training including:
$100 million in interest-free loans for apprentice programs
$75 million over three years to expand the Targeted Initiative for Older Workers program, to help unemployed older Canadians in smaller communities find jobs.
$40 million for the Canada Accelerator and Incubator Program for entrepreneurs creating new businesses.
$40 million over two years for up to 3,000 internship positions in “high-demand fields.”
Driving growth in key industries
The budget proposed to provide an additional $500 million over two years to the Automotive Innovation Fund to support new strategic research and development projects. It also plans to move forward with planning and construction on a new Windsor-Detroit International Crossing.
These and other initiatives were aimed at boosting growth in some of Canada’s key industries, some of which have been slow or stagnant since the 2008 recession.
On page three: welcome changes for small businesses
#pb#
Increased payroll remittances thresholds:
Currently, every employer with an average monthly withholding amount (AMWA) of $15,000 is classified as an accelerated remitter. As well, employers with a $50,000 AMWA are required to remit bi-weekly. Budget 2014 proposes the introduction of increased thresholds for accelerated remitters to $25,000 (from $15,000) and to $100,000 (from $50,000). The Department of Finance has estimated that 50,000 employers will see their required number of remittances cut in half.
“Increased thresholds for accelerated remitters will lower administration costs for some employers that were previously required to remit on a more frequent basis,” said Patrick Culhane, President and CEO of the Canadian Payroll Association. “The world has changed dramatically since 1990 and a payroll of $50,000 per month is no longer a large business.”
EI premium freeze
The budget would freeze the EI premium rate at the 2013 level of $1.88 per $100 of insurable earnings. This was a good start, according to the Canadian Federation of Independent Business, but the group had hoped the government would go further and start reducing EI premiums for small businesses.
CFIB president Dan Kelly said he was disappointed by the elimination of the EI hiring credit for small business.
“We urge government to move quickly to reduce EI premiums as soon as the account is back in balance,” Kelly said.