Economic advisers pushing feds to focus on business investment, job re-skilling

Economic advisers pushing feds to focus on business investment, job re-skilling

OTTAWA — The federal government’s economic advisers are calling for more changes aimed at driving business investment and helping Canadians acquire new skills as they brace for the march of technology and its job-killing effects.

The overarching goal of the influential Advisory Council on Economic Growth is to help Canadian households add an extra $15,000 to their projected annual pre-tax incomes by 2030. The group has helped the Trudeau government shape policy decisions in the past.

In its third wave of recommendations, to be released later this week, the council says Canada urgently needs another $15 billion in annual investments for adult skills development to help workers adjust to the demands of the rapidly changing labour market.

The group recommends the creation of an RRSP-type lifelong learning fund that enables workers to accumulate tax-free savings, combined with contributions from employers and government, in order to cover the cost of developing new skills midway through their working lives.

The fund would support working adults who want to upgrade their skills part time as well as those who intend to take time off to do so.

Without action to help adult workers acquire new skills, council chair Dominic Barton warns technological change could force 10 per cent of the Canadian workforce — or two million people — out of work by 2030.

“With all of the disruption coming down the pipe, especially from automation and other technologies, there’s going to be a need for constant re-skilling of the work force,” Barton, the managing director of global consulting giant McKinsey & Co., said in an interview.

“The scale of what’s required is going to be much more significant than we have.”

Barton said combined investments in job “re=skilling,” including post-secondary education and non-formal training, was $29 billion in 2016. The council wants to see that investment climb to $44 billion by 2030.

The group also recommends that governments expand services offered by their employment centres, which currently assist the unemployed, to support working adults who want career and training guidance.

The council is also calling on Ottawa to support businesses by pursuing a more agile regulatory environment, make the tax system more supportive of innovative sectors and help smaller Canadian firms increase their exports.

“In the future economy, both individuals and enterprises will need the capabilities and flexibility to identify and seize opportunities quickly,” the report said.

Added Barton: “Regulation can be a real bottleneck to it and so we’re trying to look for ways to de-bottleneck it.”

In late 2016, the council provided prescriptions for Ottawa on attracting more talent through immigration, increasing infrastructure investments and luring more foreign investment. Earlier this year, it released another suite of recommendations, including a push for Ottawa to raise the age of retirement eligibility and to explore a national child-care program to boost much-needed participation in the country’s workforce.