Alberta’s top leadership does not understand small business

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Only 8% of respondents to a recent survey believe Alison Redford understands small business

 

By Ben Brunnen

CALGARY, AB: Last week the Canadian Federation of Independent Business (CFIB) released a national report on the support of provincial governments for small business. Saskatchewan came out the best, with 72 per cent of respondents reporting being confident that their government has a vision that supports small business, 88 per cent recommending starting a business in their province, and 52 per cent reporting that their premier understands the issues of small business.

 

These are enviable results. No other province comes close to leading in all three metrics. British Columbia ranks second when it comes to confidence that ITS government has a vision for small business (48 per cent), and the premier’s understanding the issues of small business (21 per cent). While Alberta does rank second in terms of recommending starting a business (72 per cent), only 8 per cent of respondents indicated that their premier understands small business.

Small businesses are a key component to the Canadian economy. According to the CFIB, Canada has over one million small businesses (fewer than 100 employees) employing over five million people or nearly half of the private sector labour force. In Alberta, 96 per cent of business are small (50 employees or less), which contribute approximately 30 per cent of provincial GDP.

With these numbers, small businesses need to be a key consideration in any provincial economic strategy. The challenge is finding workable solutions to support small businesses. After all, small businesses exist in all industries in the province, and any strategies need to be broadly applicable.

Obviously the first priority is competitive taxes, and Alberta has lost ground to both Saskatchewan and British Columbia in recent years. Whereas in the past Alberta had the lowest small business taxes in the country at 3 per cent, now both British Columbia (2.5) and Saskatchewan (2) have lower rates. This could help explain Alberta’s less-than-stellar small business survey ratings.

The second priority is eliminating unnecessary regulation. Alberta’s 2012 red tape task force report is a good first step, but it is largely directional and lacks concrete actions. The government’s much anticipated small business strategy (a recommendation of the red tape task force), expected later this year, will be the litmus test for the province’s commitment to and understanding of small business red tape issues.

The third priority is labour. This is a top issue for Alberta small business, and one that is perhaps the most challenging to address. While some strategies include increasing immigration and tapping into underutilized pools of talent to address supply constraints, perhaps the bigger issue is supporting small businesses in their hiring and retention practices. After all, small businesses often do not have the capacity to proactively develop and apply human resource policies on a consistent basis – especially those in fast growth industries.

While much of this challenge is within the purview of the private sector, perhaps where government can step in is with regard to outreach and communication of human rights labour legislation best practices. It is these areas the companies can inadvertently find themselves at odds with the complex and subtle legislation, and greater clarity, outreach and support would likely be helpful.

But the biggest challenge confronting Alberta in its efforts to support small business is the perceived lack of leadership from the top. This is where Alberta was the weakest (8 per cent support), and is perhaps where the greatest effort needs to be made. After all, priorities of the premier tend to be acted upon.

Ben Brunnen is a policy, economic and advocacy consultant with over 10 years of experience working on public policy, economics and government relations issues.

 Courtesy: www.troymedia.com