Alberta budget's job creation incentive program gets mixed reviews

A $178-million job creation grant program in Alberta's budget may not be the best way to encourage hiring but it could also provide stability in uncertain times — it just depends on who you ask.

The program is tasked with creating 27,000 new jobs annually in the province over two years with a price tag of up to $89 million per year.

Grants of up to $5,000 will be available to small-, medium- and large-sized companies on a first-come, first-served basis beginning Jan. 1, 2016.

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The Calgary Chamber says the program will likely miss the mark.

"Five thousand dollars isn't likely to change hiring behaviour at all," said Justin Smith, a policy director with the chamber.

He says it will "simply subsidize hiring activity that was already planned" because the cost of bringing a new employee on board is so high.

Grants also available to charities, non-profits

But the CEO of a volunteer organization association says the budget and grants program could be just the ticket for stability in a challenging economic environment.

The grants are also available to charities and non-profits.

Katherine van Kooy, with the Calgary Chamber of Voluntary Organizations, said in a statement Tuesday the grants are part of a budget that "reflect an understanding of the importance of maintaining community services during times of economic hardship and strengthening programs for Alberta's most vulnerable."

Smith, meanwhile, prefers an investor tax credit, which he says has been used effectively in British Columbia and jurisdictions in the U.S. The approach would encourage individuals to invest in eligible businesses and receive a personal tax credit of about 30 per cent.

"The flexibility of the use of the capital is far more broad in this case than the job creation tax credit," Smith said.

The program will be reviewed after two years.