On Thursday you will cast your ballot in the provincial election. As you contemplate who to vote for, I invite you to consider which party or candidates will be best for business in Newfoundland and Labrador.
Business is the engine of the economy. It is business, not government, that creates jobs. Entrepreneurs choose to take the risk to start a business, to provide products and services, and to hire people like you and me. There are almost 1.1 million small- and medium-sized enterprises (SMEs) in Canada, and more than half have fewer than four employees. SMEs employ almost 70 percent of those employed in the private sector.
Small businesses are the biggest job creators. According to Statistics Canada, small businesses account for 98 per cent of all firms in Canada and proportionally, play a larger role in net job creation. Between 2005 and 2015, 88 per cent of all new jobs were attributable to small business. Medium and large businesses, which account for 1.8 per cent and 0.3 per cent of all firms respectively, created just 7.7 per cent and 4.6 per cent of net new jobs over the same period.
Small-business owners are our neighbours and friends. Most of you reading this column are either employed by or know a small-business owner. They are the fabric of all our communities.
In order for entrepreneurs to assume the risk of starting or expanding their businesses, they need certainty in the following areas:
Red tape
Here are some recent examples of red tape hampering business.
A biological medical company stalled by decision delays from the health ethics review board.
A potential gold mine experiencing delay after delay in getting a decision on an access road.
Phone calls and emails at Crown Lands going unanswered for extended periods of time.
In business time is money. Delays in getting a permit or regulatory approval can mean the difference in whether an aquaculture facility or a mine goes ahead.
We need a government committed to putting new standards in place to guarantee timely decisions and to make review processes more efficient.
Costs of doing business
Newfoundland and Labrador is already a high cost jurisdiction because of our geographic remoteness and harsh climate. In addition, we penalize businesses for growing with a regressive payroll tax. With continued high levels of debt and heavy reliance on volatile oil revenues, government’s reliance on tax from business and those in the top tax brackets (70 percent of the personal income tax is paid by 19 percent of the population), we risk deterring investors and entrepreneurs.
There is also great uncertainty about electricity rates. Have the proposed rate mitigation plans been vetted and can business rely on the promise of keeping electricity rates at 13 cents per kWh?
Is there a plan to eliminate the deficit and bring down the province’s level of debt?
Labour shortage
The Labour Market Outlook 2025 forecasts 64,000 job openings in the province by 2025, as a result of baby boomers retiring, with not enough new workers to take their place.
The Harris Centre suggests that we need to attract 10,000 people to this province per year. Yes, 10,000 per year in order to maintain the status quo, as the fertility rate is not at replacement rate, and outmigration continues to be an issue in this province.
Some questions we must ask:
Are we being aggressive enough in attracting immigrants to this province?
Are we ensuring that our post- secondary institutes are graduating the people with the skills for tomorrow’s economy?
Do we have enough computer engineering seats at Memorial University?
What it all comes down to is certainty.
How can business owners be certain that the rules under which they operate will not change drastically? How certain can they be that tax rates will not go up (and preferably become more competitive)? What level of certainty can they have that the acquisition of Crown land, an environmental assessment or an accessibility inspection will be done in a timely manner? What certainty can they have that the talent they need to grow and expand their business will be available in the province? The first ingredient in growing our economy is the people.
I encourage you to get to know who is running in your district, to read the platforms of the Parties, and to ask some of these questions to the candidates when they knock on your door. Contact them on social media and ask what are their plans for business? Do they truly believe that business is the engine of the economy? Are they willing to ensure that Newfoundland and Labrador is an attractive place to do business?
A vote for business, is a vote for jobs.
A vote for business is a vote for prosperity.
A vote for business is a vote for the future.
On May 16 vote for business.
Janis Byrne is Chair of the St. John’s board of Trade.
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