Finance Committee on March 25th, 2014

[Pedro Antunes]

Thank you for the invitation.

As you may or may not know, I run the economic forecast at the Conference Board. One of the concerns we have, looking at labour markets in general for Canada, is the impact of tightening labour markets and what it will mean for long-term economic growth.

We look very carefully at labour markets and their makeup. This is not a new story, but essentially what we are seeing is a labour market that is suffering from an exodus of the baby boom cohort, which means that we'll see labour force growth really dwindling over the forecast horizon. What I usually tell organizations is that whereas they were able to grow their employment over the past decade or so by about 2% a year in Canada, looking ahead as we close the gap on full employment, we're looking at organizations being able to grow their employment by a third of that pace.

We think this is a fundamental issue for long-term growth overall, from the perspective of generating income. It's an issue, not just for growth itself but also because we feel we need to sustain growth to make sure we have the government revenues to keep this same baby boom cohort happy with respect to the health care burden.

That's the big picture from where we come.

When we look at labour markets more specifically, we feel that we've missed opportunities with respect to certain segments of the labour market. When I talk about general tightening in labour markets, I think that's very true. We have seen, however, very divergent growth across Canada and across different segments and cohorts in the labour market in Canada. When we talk about tighter labour markets, often there are certain groups and certain regions that have been affected differently. That is also very true.

I think, however, that an opportunity has been lost with respect to youth. When we look at the general strengthening, and it has not been very strong growth in labour markets over the last two years—in 2012-13, in particular—and consider the situation with respect to youth, we have lost about 200,000 jobs in that market; that is, for those aged 15 to 24. We have not seen one iota of pickup with respect to that cohort. Employment levels are about the same as they were, participation rates have not picked up at all, and I think we've missed an opportunity here to get youth back into the labour market.

There are three issues. We often talk about skills and we often talk about experience—a mismatch in skills or a mismatch in experience. Of course, we are seeing a cohort that's leaving the labour market, which is the baby boom, an experienced and older cohort, and what we are missing is experience and skills when bringing youth into the labour market. Mobility is also an issue. I'm not sure why the youth aren't as mobile as they could be.

I think there's an issue around bias with certain occupations and skills. We have seen demand growth for certain skilled trades in particular and we have not seen the supply. We have not seen youth enter into training for these.

Just to wrap up quickly, I think the other issue is that I don't think youth are well informed about where the opportunities lie. When they enter the educational system, they are biased, as I mentioned, towards university and college degrees, but they are not well informed about where the opportunities may be and are not taking up education and training in those fields where there may be better chances of employment.

[The Chair, Conservative, James Rajotte]

Thank you very much for your presentation.

We'll now go to the Canadian Centre for Policy Alternatives, please.

[Armine Yalnizyan]

Thank you, Mr. Chair, and I thank the committee very much for inviting me to address you on this issue. I'm thrilled that this particular committee is looking at youth unemployment, as this has been a jobless recovery for the young and the situation has actually deteriorated over the last year.

Young Canadians are getting fewer of the jobs that are being created, and there are roughly 265,000 fewer young people with jobs than there were in 2008. This situation is exactly unchanged from the summer of 2009, the worst point in the downturn. More than two-thirds of the jobs that vanished were full-time positions. The youth cohort is the only group that has experienced continued job loss, even in the past year.

It's striking that there has been a kind of match between the number of people leaving the labour force, the number of jobs lost in this age category, and at least until the 2011-12 scholastic year, the increase in enrolment in post-secondary institutions, which include apprenticeships as well as universities and colleges.

But this does not let legislators off the hook. Young people are clearly doing everything they can to attain or upgrade their skills to make themselves more employable. But it hasn't been enough to prevent their unemployment or underemployment, and it is a costly gamble.

Just yesterday The Hill Times reported some Employment and Social Development Canada statistics showing that student debt has been rising since the recession. The group that is the most indebted upon graduation, those with more than $30,000 worth of debt, is the group that saw the biggest increase in indebtedness, 33%.

Not surprisingly, they are grabbing what employment they can. Many are underemployed, either in terms of hours or in the utilization of their skills.

The solutions for youth unemployment are often focused on education and training, as if the problem is the quality and the supply of labour. But the demand for labour is also changing for this group. It is a buyer's market. Employers have a much bigger pool of people to pick from for entry-level jobs than they had previously. Whether they're newcomers, older workers, or younger workers, all are competing for job openings in the context of sluggish growth that is getting slower.

Not surprisingly, we've heard more and more about unpaid internships, something we never heard about in previous recessions. But in truth we don't have any statistics to compare this recession with past recessions. We don't know whether this is a common feature or something quite unusual. But it makes intuitive sense that it's getting harder to get and keep a toehold in the job market. Young people are grabbing what they can to put relevant skills on their resumés, and some employers are actually exploiting that desperation.

Let's say that this particular meeting signals a genuine search for solutions to address these problems. We don't know how much of this situation can be dealt with by public policy, but let me give you seven stellar examples of what you can do.

First, don't make things worse. I've said this before to this group, but the use of the low-skill pilot project under the temporary foreign worker program has more than doubled, from 13,000 to more than 30,000 people, since 2007. They're in direct competition with young people. It's the same thing with the international youth work experience program, which brings people in to work from afar. They're up to 65,000 young people now.

Canadian youth need experience too, so why not make sure that every company that seeks a labour market opinion or is asking to employ an international youth exchange person lists that job at least for a few weeks on the national jobs board, which the Government of Canada runs?

Better information about where the jobs are, by industry, by level of experience, and by geography is critical for better skill-matching.

Second, boost labour mobility. Though Toronto is the biggest job market, with the most job opportunities, the fastest rate of growth of job openings is in Alberta, Saskatchewan, and the north. These are all very expensive places for young people to travel to, especially if they're debt-ridden. First and last month's rent, if they're going to go out there on spec, is hugely expensive for someone without a job.

Just last week the Bank of Canada governor, Stephen Poloz, delivered his analysis of slow growth and some of the solutions, one of which was more labour market flexibility. Why don't you invest in more mobility enhancement by offering up to $5,000 in a cost offset for those under age 30 who are willing to move, on spec, to find a job in hot labour markets?

Third, why not offer wage subsidies for the young so that you can spur private sector job creation, particularly in slow-growth markets? Many communities with slower growth are caught in a troubling spiral. They have fewer job opportunities, and this means that young people leave to go to where the job opportunities are—we're seeing this all around the world—and then they can't grow because the young people are leaving. Why not provide a $10 per hour wage subsidy for the first two months of such employment to employers who hire workers under the age of 30 in slow-growth or high-unemployment regions?

Fourth, expand the number of paid internships and summer hires with a 50¢ dollar for provinces and municipalities. The federal government could easily double, or even triple, the number of paid internships and summer hires in the public sector by matching funds with the provinces and municipalities, because as we know, there is no shortage of work to do in our communities and there are long waiting lists for summer opportunities for children.

Fifth, don't want to spend any money? How about cost-free interventions? The federal government has already allocated $4 billion in the building Canada fund as of the past budget. It could reserve one-fifth of all the jobs created by federally funded contracts for infrastructure for Canadian youth.

Sixth, you can set the example and you can set the tone. The federal government should lead by example and not hire any unpaid interns and it should amend the Canada Labour Code to specifically prohibit unpaid internships.

Seventh, track unpaid internships. We don't know what we don't know about unpaid internships. That's no way to do public policy. Provide additional funds to Statistics Canada to monitor unpaid internships on a monthly basis by adding questions to the Labour Force Survey.

I'm hopeful the Government of Canada will take steps to address youth unemployment in our country. If you did all the steps that I mentioned it would cost less than $200 million. You are committed as a government to spending billions of dollars on two new tax cuts that primarily benefit older and richer Canadians. Why not put a priority on the next generation? We need an action plan, a youth action plan, and if you won't come up with it, I'm sure the opposition parties will.

Thank you.

[The Chair, Conservative, James Rajotte]

Thank you.

I should remind witnesses that they're speaking to all members at the same time, just to be clear on that.

We have Ms. Victoria Lennox with us here now. She is the CEO of Startup Canada.

Ms. Lennox, you have five minutes for your opening statement, please.

[Victoria Lennox, Chief Executive Officer, Startup Canada]

Thank you.

I'd like to thank the committee for inviting me to appear to discuss youth employment. I will make a brief statement, and then I look forward to answering any questions you have.

I'm the co-founder and CEO of Startup Canada. It's an organization that represents grassroots entrepreneurs across Canada. Before I address the issue of youth unemployment, or youth employment, I would like to give you a quick overview of the Startup Canada story, as youth play a big role in advancing our entrepreneurial future as a country.

In 2012 we completed a cross-country tour, where we visited 40 communities across Canada and received input from 20,000 entrepreneurs and start-up founders. With this feedback, we launched an entrepreneur connect strategy at the grassroots level to help individuals communicate and share experiences together. We have become the voice of entrepreneurs and now are the go-to social media site for entrepreneurs in Canada. We have piloted Startup communities across the country to strengthen community support for entrepreneurs and to share best practices from coast to coast.

We're in St. John's, Fredericton, Quebec, Montreal, Ottawa, York Region, London, Calgary, Edmonton, Langford, and other communities across the country. We heard from many entrepreneurs that while there may have been support services for them in towns and cities, it was hard for them to know where to go, what organization to go to, and who could address their support requirements in small communities where there might not be the infrastructure. Essentially there was a missing umbrella organization connecting all of the physical and virtual aspects of the entrepreneurship ecosystem in Canada.

This is where Startup Canada and its Startup communities network plays a role. It connects accelerators, incubators, colleges, universities, hubs, entrepreneurs, and all of the necessary elements that foster entrepreneurship culture in Canada. In fact, we have a mission to create jobs on an entrepreneurial basis. We have close to 80,000 members at Startup Canada, many of whom are young entrepreneurs, and we expect that number to rise in the next few years.

With regard to youth unemployment, I recently read a report called “StartUp Generation”, commissioned by Intuit Canada on the millennial generation. According to this report, it found that more than half of millennials are most likely to start their own businesses. That's twice that of the average Canadian.

We know from StatsCan that small and medium-sized businesses make up more than half of the business sector GDP composition in Canada. Fostering an entrepreneurial culture in Canada speaks directly to the youth and is far too important for the Canadian economy to simply ignore. Out of those millennials surveyed, 40% are looking for tax breaks and government grants that would encourage entrepreneurship, 30% want fiscal literacy and financial literacy as part of their core education curriculum, 14% want to see more mentorship programs, and 16% want more access to business development services. This tells me that youth do want to start their own businesses, but they just need a little help to get over the hill to make that happen. In fact, the problem is not unique to Canada.

When I founded the National Association of College and University Entrepreneurs in the U.K. in partnership with the government in Britain, we were targeting those youth who needed the support system to become entrepreneurs. Here in Canada, since we launched Startup Canada, several universities and colleges have reached out to have us create Startup campuses within their campuses and join the network. This is a great way to expose students to the entrepreneurial world. It breaks down the silos within the institutions. It's not just the students enrolled in business programs who are exposed to entrepreneurship, but the entire student population, regardless of their enrolment or studies.

All of our Startup communities across Canada from coast to coast are interconnected and can leverage one another and access resources from one another. If you're in Smithers, you can access the MaRS Discovery District in Toronto. The strength of the high-tech sector in Waterloo can benefit the strengths of the resource sector in Calgary. Connecting students to this wealth of knowledge and plugging them into the entrepreneurship ecosystem is important to creating jobs and innovation. This is where the true power of Startup communities and Startup campuses can be found.

In closing remarks, we support any investments or measures that foster an entrepreneurial culture in Canada. We believe that cultivating a better entrepreneurship ecosystem will lead to better jobs for young people. The Canadian accelerator and incubator program is a good example. We support the internship program targeted at small and medium-sized enterprises, but we caution that the process cannot be cumbersome for entrepreneurs; otherwise, we risk having a resource that not many SMEs will use. We support investments that are meant to encourage women, and especially young women, to become successful entrepreneurs.

Finally, Startup Canada and its 300 volunteers are working hard to promote an entrepreneurial culture in Canada.

We have facilitated the mentorship of 20,000 entrepreneurs, run activities and daily events, nationwide, on topics ranging from financial literacy to legal structures of companies, and have most recently launched the Startup Canada awards to recognize outstanding achievement in advancing entrepreneurship in Canada.

Thank you.

[The Chair, Conservative, James Rajotte]

Thank you very much for your presentation.

We will now go to Ms. Schirle, please, for your opening remarks.

[Dr. Tammy Schirle]

Thank you.

Thank you for having me here today. I enjoy the opportunity to speak with you.

In the March 6 meeting of this committee you heard from René Morissette and Alison Hale, from Statistics Canada. They are highly respected researchers so I see no need to replicate any of the information they provided to you.

An important point to take away from their presentation is that youth employment differs substantially by gender and by region.

Today I'd like to break down the data a bit more for you. In particular, I want to describe what youth are doing if they are not working full time, and the extent to which policy-makers should be concerned about youth having difficulties in the labour market. I also want to address whether youth today are finding it more difficult than previous generations. Finally, I will mention some policies that I think require further scrutiny. I have to be very brief here but I have provided many details in my written brief to the committee.

What are youth today doing with their time? I looked at young people surveyed by Statistics Canada in the 2012 and 2013 labour force surveys and categorized their activities. Over three-quarters of young people 17 to 21 years old are doing exactly what I think most parents hope their kids will do after leaving high school. They are in school full time or working full time. Many others are working or going to school part time, and many have not yet entered the labour force.

I'd like to focus more on young people aged 25 to 29 years, because this is the group we expect to be more attached to the labour force. They're typically done with school and are establishing their careers and their families. The key difference between men and women in this age group is that the average woman is having her first child. With that in mind, I'm going to focus more on young men, who remain less likely to become primary caregivers while children are young.

Of men aged 25 to 29, 75% were working full time, and another 7% were in school full time in 2012 and 2013. In a more stable labour market in 2002 and 2003, 77% of men aged 25 to 29 were working full time, and 6% were in school full time. For comparison, 83% of men aged 35 to 49 were working full time in 2012 and 2013.

Young men were more likely unemployed than older men, which is not unusual. When unemployed, youth tend to have shorter jobless periods. Their unemployment rate in part reflects the same business cycle effects as for older individuals. In addition, people are leaving and finding new jobs as they establish their careers. Their unemployment is not exclusively a response to the most recent recession.

I have heard several concerns regarding youth unemployment statistics. First, people may give up their job search and return to school full time, in which case they are no longer considered unemployed. I don't think this is as large a concern here. The same percentage of 25- to 29-year-old men were in school full time in 2013 as there was a decade earlier in 2003.

Second, there is a concern that they have given up their job search and become discouraged workers, those who would like to have a job but do not search because they believe jobs are not available. Formally speaking, only 0.1% of men aged 25 to 29 would have been considered discouraged workers in 2012 and 2013, or roughly 1,000 people. It was the same in 2009, and in 2002 and 2003.

If we were to allow for those working part time and wanting full-time jobs, but did not look, and those not participating in the labour force while going to school part time, we might suggest that up to 2% of young men were discouraged in 2012 and 2013. Notably, this is not larger than in 2002 and 2003.

Third, the claim is made that young people are finding it more difficult to find secure and stable employment relative to generations past. I have only found evidence that contradicts this.

First, Dr. Pierre Brochu at the University of Ottawa has shown that job retention rates have actually increased for new employees since the mid-1990s and are recently at record highs. Second, it is clear that the opportunities available to any young woman today far surpass those of previous generations. Occupational gender segregation remains an important concern and has not changed enough over the past three decades; however, the gender gap in wages has narrowed considerably and the participation of women in the labour force continues to increase. Third, it seems that past recessions hit younger workers even harder than the most recent recession. Not only did youth unemployment rates reach much higher levels in the early 1980s, but young workers in the 1980s were hit much harder than middle-aged workers when compared to our most recent recession.

Overall, I don't think it's worth dwelling on intergenerational inequities in labour market experiences. I am concerned that the expectations of youth are often out of line with reality. Anecdotally, it seems that the majority of my students expect to complete their undergraduate degree and immediately find a secure job with a salary that would place them in the top 5% to 10% of Canadian earners. No doubt it takes some time for their expectations to adjust after leaving school.

In my last minute I would like to mention a few concerns for policy-makers.

First, it is clear that there is still a high return to post-secondary education, especially for women. As long as that return is positive, education is not wasted. Without clearly identified market failures, I am reluctant to recommend interfering with the skills market.

Second, over time we have developed an incredibly complex web of tax credits, transfers, and direct programs designed to help young people. For example, a young man with a child, who is considering an apprenticeship, will need to work through at least 18 tax and benefit programs to determine how best to proceed.

It is clearly time to assess and redesign our tax and transfer system to achieve greater transparency, and to simply make it user-friendly and easily understood. This assessment has not been done since the 1960s with the Carter commission. I strongly recommend this committee consider the value of a new commission framed with current and future Canadian family structures in mind.

With that, I thank you for your attention and I am happy to take questions.

[The Chair, Conservative, James Rajotte]

Thank you very much for your presentation.

We'll now hear from Mr. Poschmann.

[Finn Poschmann]

Thank you very much, Mr. Chairman. Thank you to the committee for inviting me back.

I'll only make a few brief comments by way of an overview. It's going to be hard to top Tammy's presentation. I have included a few figures, which I think tell a clear story, and I believe members should have those figures.

I begin by setting an employment, or unemployment, backdrop for the over-25s, male and female. In other words, in my definition, they are not necessarily youth. My reason for doing that is that it tells you right away what the overall state of the economy is, or has been.

The unemployment rate tells you when things have been generally good or generally bad. It's easy with an unemployment rate figure, as in my first slide, to pick out the impact of some of the big shocks that we had, including one in the early 1980s, another a decade later, a smaller shock earlier this century, and another deeper one from the fall of 2008 to the spring of 2009. The unemployment rate trails these shocks a little bit. Firms don't start laying off right away, not in Canada; so the uptick in unemployment also trails by some months the downtick in market conditions.

On this history, I have a couple of overarching points. One is that the experience for men and women has been slightly different in past decades, and has also become a little more similar over time. Another is that in the almost five years since the end of the last recession, the labour market has been performing decently well, at least as measured by the unemployment rate, which, overall, is cruising in a pretty normal range.

That's the unemployment rate, or the share of the labour force actively looking for work. But what about the employment rate, or the share of the population that is working? This measure abstracts away questions concerning the number of job seekers who have become discouraged, or concerning the number of men or women who have otherwise left the labour force.

It tells a fascinating story. The most striking one is that the Canadian employment rate has generally picked up over time. We used to lag the U.S. by a lot, and that's just no longer the case. What's more striking is women's labour market activity. Changes in education patterns and in social and home structure really jump out at you. Over the past couple of generations, a huge wave of women has entered the paid labour force and it shows.

In case you're curious, women primarily entered the health, education, and public service fields, and therefore primarily unionized fields. But the key point here is that women have entered the labour force since the sixties and seventies, and it really shows up in the participation rate and economic outcomes.

This committee's study is on youth unemployment, so it seems to me we should have a look at the data by age group. I focused on desegregating the data by age and sex more so than by region, as did our friends from Statistics Canada.

Some folks would count youth as the 20- to 29-year-old group, or include the 25- to 29-year-olds, and I could make a good case for that. Tammy Schirle did include that and I'm grateful that she did because I looked a little more at the 15- to 19-year-olds and the 20- to 24-year-olds, and then compared them to the older groups.

I would tend to ignore or not put much emphasis on the 15- to 19-year-olds mostly because school issues dominate, or should; summer jobs come and go with the weather. I looked instead a little more carefully at the 20 to 24-year-olds with a view that if you're not in school and not working, you really should be working. Otherwise, you're going to face trouble later.

In my later figures, I used some arithmetic to filter out the peaks and valleys, so that the data revealed underlying trends. What these figures show is that there does not seem to be a significant cause for worry. Yes, the recent recession set the 20- to 24-year-olds back, but not the way prior recessions did, and they seem to be bouncing back pretty well. Put another way, if you look at the past five or six years, for the 15- to 19-year-olds, you would see a significant growth in unemployment, not a very happy story. But if you look at the 20- to 24-year-olds, you'll see a happier story indeed.

That's unemployment. What about employment?

It is pretty much the same. The 25- to 44-year-olds are going great. It is the same for the 45- to 64-year-olds. Both of these groups, of course, reveal the changing pattern of female employment from decades past. Again, life is a little less rosy for the 15- to 19-year-olds, but for the 20- to 24-year olds and up, the story is pretty much a lot of nothing.

What I do worry about—and it was nice to have reassuring words on this point from Professor Schirle—is the early-year labour market conditions for school leavers or recent graduates, whether from high school or from post-secondary. The data here do not indicate a problem but if there were to be future trouble, especially for income growth, it would come from having poor early experiences for new hires; in other words, being laid off a lot in your early years in the job market is bad for your long-term income trajectory.

What do we do about that? If it is a problem, that takes us to a short key policy list. Make sure kids finish public school and high school—

[The Chair, Conservative, James Rajotte]

Okay, Mr. Poschmann.

[Finn Poschmann]

Okay, I'll close off there.

There is a very short policy list, and I'm done. I hope we can talk about first nations as well.

[The Chair, Conservative, James Rajotte]

Okay, thank you very much for that presentation.

We will begin members' questions.

We'll start things off with Mr. Dubé for five minutes.

[Matthew Dubé, NDP, Chambly—Borduas, QC]

Thank you kindly, Mr. Chair.

Thank you as well to our witnesses for being here.

Since I have only five minutes, I would ask you to keep your answers short.

Mr. Poschmann talked about a story, and I'm interested in the end of the story, not what's happening in this chapter right now but the long-term impacts.

I want to quickly quote the TD study, “The Plight of Younger Workers”. It says, “In addition to competition within their own age group, they now must compete with older workers looking to reenter the labour market and those more experienced who lost their job during the recession.”

I think this tendency is clearer and clearer, that despite the fact that it's a normal youth unemployment rate it's pretty clear that with the change of eligibility for old age security, with ballooning student debt, and things like that, the financial situation for these young people is different. So despite unemployment, there are still some long-term challenges for young people to find well-paying jobs and be able to contribute to our economy.

I would be interested...particularly from our friends from the Conference Board of Canada and the Canadian Centre for Policy Alternatives, but just keep it quick, please, if possible.

[Pedro Antunes]

It's a huge cost to have youth out of the labour market if they are looking for work.

I think you're absolutely right when you're talking about this increase. We have seen a significant increase in part-time workers recently and that certainly displaces when you look at youth employment. It often is part-time work, especially for those younger cohorts and I think that is certainly displacing the opportunities for those whom I call “kids”—I have a son that age—to get into the labour market and earn some experience. Even if they're young I think what they learn in the labour markets at that age is valuable.

In terms of the opportunities down the road, I think the pendulum is pretty optimistic in the labour market. I think it has swung toward youth. I think there have been a lot of opportunities in our labour market. I think there are issues around youth mobility. They're not quite as anxious to move out and look for work elsewhere, and we've really missed getting them better aligned for the labour market. So I think it's one of educating that age group in where the opportunities may be.

[Matthew Dubé, NDP, Chambly—Borduas, QC]

Yes.

Go ahead.

[Armine Yalnizyan]

Thank you for the question.

It's been said a couple of times that there is no story. There is nothing to look at here because young people aren't as unemployed as they were in the 1980s. I was caught in the 1980s unemployment and I know how bad it was.

What is different this time around is that there has been virtually no improvement in the number of jobs available to the 15- to 24-year-old cohort. A lot of people have talked about what has happened to the older end of that, but if young people can't work while they're in school, they're not going to be able to pay for education, and everybody is saying that education is your ticket to something better.

I would just like to compare and contrast that the youth unemployment rates were higher in the 1980s, certainly, not by a lot but enough. But the Progressive Conservative government of that day introduced numerous measures to deal with unemployment rates there that totalled billions of dollars through the Canadian jobs strategy. Youth was one particularly targeted clientele. Hundreds of thousands of participants went through the Canadian jobs strategy.

In contrast the last budget of the federal government introduced $55 million to create 4,000 new paid internships. At last count there were 380,000 young people actively looking for work. That's about 1% of what's going on.

So more can be done. Will you find this a compelling enough story to do something?

[Matthew Dubé, NDP, Chambly—Borduas, QC]

Thanks.

I have one minute left, so I'll try to be quick on this. Just to that point, if we look at the Canada job grant, for example, I don't think.... We automatically assume that skills training is for young people, but it's not necessarily, unless we specifically choose to focus on that segment of the population.

You mentioned the competition that exists. Are the policies right now forcing people to essentially fight each other—that's a violent metaphor—for jobs as opposed to specifically looking to bring youth up with really specific policies geared towards them? Is that a problem? Is that what you're saying?

[The Chair, Conservative, James Rajotte]

Just a brief response, please....

[Armine Yalnizyan]

Yes. It's very difficult to target jobs for young people when you have such sluggish growth. Our pace of job creation is very slow, which is why the Bank of Canada governor here and Janet Yellen in the United States have focused on slow growth as the number one concern if you're trying to create jobs for your people.

By the way, unemployment rates are lower in the United States today than they are in Canada. We've been stalled at around 7% for the last year, while they're at 6.7% and falling. They're going to pass their target of 6.5%, at which point they'll start looking at raising interest rates.

[The Chair, Conservative, James Rajotte]

Merci.

We will go to Mr. Saxton, please, for his round.

[Andrew Saxton, Conservative, North Vancouver, BC]

Thank you, Mr. Chair.

Thanks to our witnesses for being here today.

I just want to remind Ms. Yalnizyan that the U.S. does measure unemployment differently than Canada does, so you have to take that into consideration.

My first question is for Mr. Antunes from the Conference Board of Canada.

Mr. Antunes, as you know, our government recently reached an agreement-in-principle with all provinces on the Canada job grant, which would mean that this program will bring together the federal government and the provincial government, as well as businesses, to provide and deliver skills training.

In the past, the Conference Board has been an advocate for the need for increased participation of businesses in delivering the skills training process, so I have a question. Why is it important for businesses to be involved in the skills training process? With businesses playing an increased role in skills training, will the younger generations be better equipped to meet labour market demands?

[Pedro Antunes]

Thank you for the question.

Yes, we do like the job grant program, in the sense that it is driven at the core by an investment in terms of dollars from those organizations wanting to hire. We feel that it is a very good signal in terms of driving where the money is spent with the private sector actually having to ante up some money in terms of the programs.

We often talk about the foreign worker programs as filling a need for businesses. We do a lot of work with organizations that are using these programs. The reason they're using them is that they really can't find certain workers in certain fields. It's very expensive and time-consuming, etc., for organizations to get welders from the Ukraine or other skilled trades from other countries to come here and work. They would avoid it if they could, if they had the skills and the training in the workforce here at home, so I think this will help bring that signal through the training programs.

[Andrew Saxton, Conservative, North Vancouver, BC]

Will it help young Canadians to be better prepared for the workforce?

[Pedro Antunes]

I think so as well. It's not clear that across all regions there are huge gaps in the need for skilled trades, but there certainly are some regions in this country where there's a desperate need for skilled trades and they're not finding the workers.

There are two issues here. One is labour mobility, and one is the training.

I think there's a fair bias against these types of skilled trades. It's very hard to get in. We talk about apprenticeship programs as having an under-representation in those programs. It's hard to get in. I don't think the youth are quite motivated to get into these programs, yet there are fairly good jobs that are highly paid. We talk about manufacturing jobs being good jobs. Well, I think the skilled trades are good jobs. In terms of work in the resource sector, there are some very good jobs there.

[Andrew Saxton, Conservative, North Vancouver, BC]

Thank you very much.

My next question is for Ms. Lennox at Startup Canada.

In your opening presentation, you mentioned accelerators and incubators. Last year, as you probably know, in September 2013, the government launched the Canada accelerator and incubator program as part of the venture capital action plan. From your experience, how important are accelerators and incubators for young entrepreneurs who are looking to get their ideas off the ground?