Canada has a high unemployment rate and the federal government intends to “fix” it by borrowing billions of dollars, crossing its fingers and then spending the money with the hope of creating jobs for workers.
However, taxpayers have seen this movie before in Canada. Insiders and friends of the government often receive many of the funds from such spending sprees, the jobs seldom materialize as promised and loans are rarely paid back in full. (anyone from Bombardier reading this?)
But what if there was a better way to create jobs – one that doesn’t involve politicians spending your hard-earned money?
In fact, SecondStreet.org recently put together a free eBook, Life After COVID, with several other public policy organizations to examine this issue and other challenges Canada faces as we emerge from the pandemic.
In our chapter we discuss how Between 2014 and 2020, governments stalled or cancelled at least $215 billion worth of natural resource projects.
The projects stretched from coast-to-coast and included major mining projects, oil and gas extraction as well as pipeline infrastructure. Whether we’re talking about the enormous Petronas LNG project in B.C., the Matoush Uranium mine in Quebec or the Energy East Pipeline project – Canada’s list of missed opportunities is staggering.
We’ve become a nation of stop signs when it comes to natural resource development while the rest of world continues to display green lights.
To put our missed natural resource opportunities into perspective, the value of these projects is the same as building an NHL-sized arena every single day for a year. If governments merely unshackled our nation’s natural resource sector, it could create thousands of jobs without costing taxpayers a cent.
But these aren’t just any jobs. Natural resource jobs are one of the highest-paying sectors in Canada. For 2020, Statistics Canada data shows natural resource sector jobs paid an average of $40.92 per hour – the second-highest rate in Canada.
If the federal government is worried about losing its “green” reputation by supporting more natural resource development, it could perhaps commit to using the tax revenue from these projects for carbon capture, research and development towards new technology … or perhaps planting some of the 2 billion trees the prime minister promised to plant?
Make no mistake, there are many other ways governments could create jobs by simply getting out of the way, rather than large subsidies.
According to the Canadian Federation of Independent Business, unnecessary red tape costs entrepreneurs $11 billion per year. Identifying and eliminating such obstacles could free up entrepreneurs from needless paper work and compliance costs, allowing them to expand and create new opportunities for workers.
Similarly, a 2016 Senate report on interprovincial trade barriers (rules that make it difficult for businesses to engage in commerce in multiple provinces) noted that these regulatory obstacles cost our nation’s economy upwards of $130 billion each year. An aggressive push to eliminate these barriers could yield significantly more economic activity in Canada and even more jobs.
As you can see, there are plenty of ways governments in Canada could create thousands of jobs by simply getting out of the way and allowing entrepreneurs to do what they do best.
Colin Craig is the President of SecondStreet.org and is a co-author of Life After COVID: What’s next for Canada?