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Financial Post, Weekly edition, Sat 20 Apr 96, page 20

Keywords: Job creation Canada

OTTAWA'S JOB-CREATION RECORD EXTOLLED AS A MODEL: Europeans offer unexpected praise

Alan Toulin

Industry Minister John Manley had an unusual experience recently.

While attending a G-7 jobs conference in France, Manley heard praise concerning his government's job-creation efforts.

Politicians are used to criticism from all corners -- even their own -- so when Canada was extolled as a model for European nations, Manley was pleased.

With the vast apparatus of the industry ministry at his disposal, Manley is the politician held most responsible by his colleagues and Canadians for job creation.

For Europeans, Canada seems to have found the so-called ``third way'' of unleashing economic dynamism without at the same time destroying the social underpinnings of society.

French President Jacques Chirac contrasted Europe's anemic job creation but solid social safety net, with the U.S.'s dynamic job growth but social problems.

Canada, Chirac said, seemed to be able to ignite its economy without sacrificing essential parts of the social safety net.

For his part, Manley said the jobs conference in Lille persuaded him the government is on the right track, though clearly not enough jobs are being created in Canada.

``I think what's of value in these things is that we are able to share experiences and gain perspectives on common problems,'' Manley said.

``The common challenge is the effect of rapid and profound technological change in the context of international markets.

``We're all facing that and we're all dealing with the problems of workers displaced by technology.''

Manley is troubled, though, by the fear of joblessness and the impact this is having on people's willingness to adopt new technology and to stick with open trading and investment policies.

``People are worried. You can't take someone out of a career as a fish worker and turn them into a computer programmer.

So, talk about technology is not reassuring, it's frightening to people.''

The cornerstone of Industry Canada's job strategy, however, is to apply technology widely across Canadian industry and to help Canadian companies become exporters as quickly as possible.

However, since the signing of the first free trade deal with the U.S. in 1989, Canadian governments consistently have failed to adopt needed adjustment policies.

It's a failure that Manley recognizes.

``If there is an area that we need to put emphasis on and see how we can learn from others, it is in this whole area of worker adjustment,'' he said.

Canada's main employment adjustment programs are carried out under the Unemployment Insurance program.

Reforming this big swath of public spending has been a major undertaking that has consumed much time and government effort.

Now, the whole question of job training and worker adjustment is still up in the air because of the interest of Quebec and other provinces in keeping manpower training as solely a provincial responsibility.

It's not comforting to tell job-hungry Canadians that they will have to wait until Ottawa and the provinces can resolve these issues. In fact, more can be done to create jobs.

In taxation policy there are many incentives to invest in equipment but few to invest in human capital.

Payroll taxes are job killers and business has been legitimately complaining about them for years without seeing much relief.

Radical ideas such as work-sharing and re-defining work should be part of a national debate fostered by government.

There is a clear and pressing need to integrate welfare, unemployment insurance, training and education, all of which will require levels of co-operation that have eluded our federal and provincial governments.

Joblessness represents a waste of human resources, a gross inefficiency in the economic system, and is a cause of social distress that undermines our goals as a nation.

(Ed. note) Alan Toulin is The Financial Post's bureau chief in Ottawa.

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Revised: May 10, 1996

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