How much to spend to create one job? Kenney's benchmark different than Goodyear's

Kenney

Last week in the House of Commons, Employment Minister Jason Kenney was asked why his department did not renew funding for a Halifax agency that helps at-risk young people find and hold on to jobs. The program had been in operation for a decade and, as CBC News reported, had followed all the rules to qualify for the $191,105 it was seeking this time around.

It did not get the money. Though department bureaucrats were ready to recommend approval of the grant, the minister — Kenney himself — was not. New Democrat Megan Leslie asked him why he rejected the request. Here is his answer:

Mr. Speaker, very simply, the proposed grant would have cost approximately $45,000 in tax dollars for every job created.
I know that to the New Democrats there is no limit in the largesse with which they would have government spend tax dollars. We are committed to creating jobs and assisting youth at risk, which is why we invest enormously in skills development in that area. However, there has to be a practical limit. I know the New Democrats would be happy to spend $80,000 or $120,000, but we think that spending $45,000 in tax dollars to create one job is unreasonable and unjustifiable.

And yet, later that week, Kenney’s cabinet colleague Gary Goodyear, the minister of state for federal economic development agency for southern Ontario (FedDev) , announced that it had provided cash to several high-tech firms in the GTA and the dollar-per-job created ratio was, in some cases much higher than the numbers Kenney referenced. Now, to be sure, the money Goodyear was providing was in the form of “repayable” grants and the Halifax agency was receiving a grant.

Still it raises the question: How much are taxpayers prepared to spend to create one job? $45,000? $190,000? Will we spend a bit more if it helps at-risk youth who might otherwise be at risk for committing crimes? Will we spend more if it’s a software engineer?

In the backgrounder to the Goodyear press release announcing these funds, FedDev Ontario included a column titled “Anticipated Number of Jobs to be Created by the Project”.  Here, then is an excerpt from that table with a column I’ve added “Subsidy Per Job”.

Company Subsidy Jobs to be created Subsidy Per Job
Askuity Inc. $660,000 11 $60,000
Hubba Inc. $500,000 4 $125,000
Hydrostor Inc. $570,000 3 $190,000
Influitive Corp $750,000 12 $62,500
Method Integration $500,000 46 $10,869
MolecuLight Inc $990,000 7.5 $132,000
Polar Sapphire Ltd. $990,000 28 $35,357
Quandl Inc $694,729 8 $86,841
SceneDoc Inc $625,000 5 $125,000

One thought on “How much to spend to create one job? Kenney's benchmark different than Goodyear's”

  1. Even if you are already educated, you still can’t get a job.There was supposed to be an, acute shortage of labor in the resource sector of BC. I moved the family up here to be closer to the resource fields.

    As an Electronics Engineering Technologist, B.Sc degree, I was hoping for a job, within a short span of time. I was sending out up to, 20 applications a day and no luck. I was very puzzled so, I did a courtesy call to a HR. I was told there were over 4,000 applications for just that one job position. Another HR said, due to the volume of applications, we can accept no phone calls.

    I was absolutely astonished and there is no shortage of labor, that I can see. I was further astonished when? Premier Christy Clark chided Kenny and Harper regarding the TFW program. She said she needs thousands of foreigners for her, 100,000 LNG jobs. And, thousands for her 6 figure wage jobs for her mines.

    Now we read? Nexen of China owns 800 hectares near Prince Rupert, where they will build their LNG plant. Christy is bringing over East Indians and Chinese, to develop her LNG. I believe China owns the cluster of mines, in BC’s High North as well.

    No-one has to spend money on me, for education. Nor, will the government spend any money training anyone else either. All they have to do is, bring over more foreigners.

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