UCP announce grant for companies to hire new workers

Earlier this week, the Alberta government announced plans to set aside up to $370 million for what they’re calling the Alberta Jobs Now programme.

Half of that funding will come from the federal government through the Workforce Development Agreement.

The new programme will subsidize private businesses and non-profit organizations in paying worker salaries through a one-time grant.

According to the government’s website, the grant would cover 25% of a worker’s salary for a 52-week period, to a maximum of $25,000 per worker. If the worker has a disability, then the employer can apply for 37.5% grant instead.

Which is interesting.

If there’s a position at a company that pays $15 an hour, the grant allows the employer to pay only $11.25 out of pocket for a general employee. If the person has a disability, then the employer doesn’t need to pay more than $9.38 out of pocket.

Also, do companies hiring people at $100,000 a year really need a hiring grant? Are there that many unemployed people who make 6 figures?

The employer also has the option of using the grant for training expenses, instead of wages. Or they can do a combination of the two. Either way, it’s still a maximum of $25,000 and has to be 25% of the new worker’s salary.

New hires must be unemployed or underemployed (working less than 30 hours per week) and must be placed into full-time, permanent roles (more than 30 hours per week).

Employers will be able to apply for a maximum of 20 full-time workers during each of the 3 intake periods the government is setting up, the first of which started yesterday and runs until the end of August. They can receive all of the grant after their new hires have worked for 52 weeks, or they can get half after the workers have been with the employer for 3 months and the other half after the year mark.

If an employer does hire 20 new workers at the $25,000 maximum, that’s a potential $500,000 per intake period, or $750,000 if the workers have disabilities. If they max out their hires in each of the 3 intake periods, that could end up coming out to $1.5 million for general workers and $2.25 million for workers with disabilities.

And sure, that money is supposed to go toward the worker, but if the worker gets $25,000 from the grant, then the employer has an extra $25,000 on hand. Either way, it’s still an extra $25,000 in the employer’s pocket. Or $10,000. Or $5,000. Or whatever.

Also, are employers really going to hire new workers and pay 100% of their salaries for an entire year before even getting the grant just because the grant exists now? Was the only thing holding them back from hiring new workers the fact that they thought they’d have enough income to cover only 75% of their income for the year?

During the press conference, Alberta premier Jason Kenney introduced the new grant as “a historic announcement that will get tens of thousands of unemployed Albertans back to work.”

If employers max out their grant amounts of $25,000 per worker, it’ll result in 14,800 new hires, 9,867 if they all had disabilities. Compare that to minimum wage.

Given that the programme considers that full-time is at least 30 hours, we’ll use that as our starting point. $15 an hour at 30 hours a week for 52 weeks works out to $23,400, and 25% of that is $5,850. That works out to 63,248 new hires.

You can watch the 46-minute long press conference here: