Construction leaders in B.C. are applauding the 2014 federal budget, which focuses on apprenticeship and skills training, but some are concerned the deficit is being eliminated too quickly and it could cause an economic slump.
“The BCCA (British Columbia Construction Association) is pleased to see continued emphasis on apprenticeship and training at both the federal and provincial level” said Manley McLachlan, association president.
“Canada needs to undergo a culture shift in regard to how it views post-secondary education and how we position careers in the trades.”
Finance Minister Jim Flaherty presented the 2014 federal budget in Ottawa on Feb. 11.
It includes several new measures that are seen as a sign of progress by the construction industry, such as apprentice loans, employer EI top-ups to apprentices and flexible apprenticeship delivery programs.
Despite McLachlan’s support for these new initiatives, he also has several concerns.
“The increasing centralized control for these programs from Ottawa is a risky approach: for demand-driven job placement programs to be effective, they need to be nimble, located in the communities they serve and customized to a region,” he said.
“STEP (the Skilled Trades Employment Program) is a great example of this.”
BCCA operates several STEP programs to assist individuals, from a wide range of backgrounds, get started in or further develop a career in the skilled trades.
Established in 2006, STEP has more than 35 Regional Employment Placement Specialists, who network throughout the province, and connect employers with job seekers.
More than 6,000 individuals have been connected with new opportunities through STEP. In 2013-14, STEP is targeting more than 2000 additional placements.
McLachlan is concerned because it is unlikely that a federal “one size fits all” solution can work.
He argued that a centralized approach can’t deal with regional disparities. Instead, it will do more to serve the educational establishment than it will to serve workers and employers.
The B.C. Road Builders and Heavy Construction Association support the 2014 budget’s move towards eliminating the deficit, but they have some concerns.
“Although we are in favour of a balanced budget, we think the cost of doing it this quickly might be too high and they may stall economic growth,” said Jack Davidson, association president.
“In 2014 and 2015, both the federal and provincial levels of government will be pulling back investment on infrastructure, which will create a large problem for the industry in many ways. We will have to wind down a little bit and will have a problem retaining our workforce.”
Davidson said Building Canada will not kick in until 2015 or 2016.
In addition, most of B.C.’s heavy construction projects in electricity generation, mining, bridge construction and oil and gas are not scheduled to start for another a few years.
The $53-billion Building Canada plan was announced in last year’s budget and is scheduled to start in 2014–15.
The 10-year plan will help build roads, bridges, subways, commuter rail and other public infrastructure assets that promote productivity and economic growth.
The 2014 budget projects the deficit will decline to $2.9 billion in 2014–15 and a surplus of $6.4 billion is expected in 2015–16.
The 2014 budget proposes to create the Canada Apprentice Loan, which will allocate more than $100 million in interest-free loans to apprentices registered in Red Seal trades.
Apprentices registered in their first Red Seal trade apprenticeship will be able to apply for interest-free loans of up to $4,000 per period of technical training.
Interest charges and repayment of the loans will not begin until after the apprentice completes or ends their training program.
At least 26,000 apprentices per year are expected to apply.
The estimated net cost of these loans to the government would be $25.2 million over two years and $15.2 million per year ongoing.
The Flexibility and Innovation in Apprenticeship Technical Training pilot aims to expand innovative approaches to the delivery of apprentice technical training, by reducing non-financial barriers to the completion of training and certification.
In particular, the project will test alternatives to the block training approach in order to allow apprentices to continue working and earning while completing their technical training.
For example, the pilot could use in-class simulators, e-learning modules, remote learning sites and video conferencing in place of, or in addition to, traditional in-class training.
It is anticipated that the pilot project could support up to 12 multi-year projects across the country through a reallocation of $13 million over four years starting in 2014–15.
Finally, the Employment Insurance Awareness Initiative for Apprentices proposes to take steps to increase awareness of the financial supports available for apprenticeship training.