Good afternoon, and thank you for the opportunity to speak with you here today.
As mentioned, my name is Elizabeth Aquin, and I'm the senior vice-president of the Petroleum Services Association of Canada, or PSAC—the other PSAC.
Joining me today is Kathy Marasco, vice-president of corporate human resources, a representative from one of our member companies, Sanjel Corporation.
The Petroleum Services Association of Canada is the national trade association representing the service, supply, and manufacturing sector of the upstream petroleum industry. PSAC represents a diverse range of over 260 member companies, employing over 76,000 people, and contracting almost exclusively to oil and gas exploration and development companies. PSAC member companies represent approximately 80% of the business volume generated in the petroleum services sector.
PSAC is having statistics updated this fall on the economic contribution of the petroleum services sector; however, for the purposes of perspective, a study by the Canadian Energy Research Institute revealed that in 2006 the sector contributed $65 billion to Canadian GDP, paid $9 billion in personal and corporate taxes, and employed 800,000 people across the country directly and indirectly. In 2009, 36 Canadian-based companies alone exported almost $13 billion worth of products, technology, and services.
We believe that the oil and gas industry in Canada is, and will continue to be, a major source of economic growth. Arguably, however, one of the biggest obstacles to this growth is the shortage of labour. This issue will require a combination of remedies, some of which I would like to highlight here today.
The first one is with respect to the overseas employment tax credit, OETC. When companies have valuable employees who have gained experience and are now able to help Canadian companies diversify and grow internationally, the main issue is retention. Retention involves continuing to provide those employees with career or personal development opportunities, compensation incentives, or perhaps a combination of both. The OETC is one example of such an incentive. Work assignments in foreign countries are typically rotational in nature. For example, employees are requested to work 30 days in the foreign country, and receive the next 30 days off in Canada. This type of arrangement causes significant disruption to family life. The OETC has been a very effective tool in enticing employees to accept such work arrangements.
The benefits of the OETC are several. The company is able to expand internationally, earning revenue for itself and for Canada and providing increased jobs to Canadians through such growth, as well as the portion of income tax paid by those employees working internationally, over and above the OETC. As those employees return home, they also contribute to the Canadian economy as they spend their disposable income in Canada. In addition, the company is able to retain the employee to deploy as needed. The phasing out of this tool, as indicated in the 2012 budget, removes an important arrow in the quiver of Canadian competitive advantages.
On another topic, as PSAC member companies search for new employees, they most certainly seek Canadians first. This makes the most business and economic sense, as international recruitment is expensive, time-consuming, and often beyond the HR capabilities of many small and medium-sized enterprises. Placing an ad in the local paper is always the first choice. As much of PSAC's membership operates within Alberta, more and more member companies have started to expand their recruitment searches across the country, aware that—