While credits exist for tuition, businesses in Ontario remain uncompensated for other costs associated with training. As a result, workforce training has fallen behind international peers, and is heavily concentrated among larger firms.

Existing training supports often reimburse direct costs such as tuition, but ignore indirect costs, such as wages paid while training and lost productivity. As a result, small-to-medium-sized enterprises (SMEs) under-invest in training compared to larger firms, reinforcing productivity gaps and labour shortages. Given Canada’s productivity gap and the need to keep up with rapid advancements in technology, lifelong education cannot be ignored in the mission to maintain a skilled workforce competitive on the global stage.

A 2023 analysis of employer training in Canada noted that Canadian firms spend only about $240 per employee annually on training, a modest amount that lags international peers. These investments, again, are concentrated in larger enterprises; larger firms are far more likely to offer skills training, leaving a gap at the SME level.

In a 2021 survey-based study on post-pandemic skills needs, most SME respondents reported difficulty finding time for employees to engage in training. The report explicitly recommends exploring ways for governments and support organizations to support and incentivize investments in training (both in time and money) for small businesses. 34% of Ontario manufacturers surveyed indicated that a busy production schedule limits the time available for training apprentices, while only 20 percent of retail firms reported offering training to employees to integrate and use new technologies, and only 11 percent reported having plans to provide training to employees to take on new roles in the organization.

The evidence from Ontario and Canadian sources is clear: SMEs invest less in training not because they see little value, but because they face greater barriers, especially the immediate cost of lost work time when staff are in training.

A refundable SME training tax credit for paid release time directly targets this problem by offsetting wage and productivity costs, thus incentivizing small businesses to upskill their employees. The GNCC is calling for:

• A refundable SME Training Tax Credit that offsets wages paid during verified employee training hours.
• An emphasis on administrative simplicity, predictability, and accessibility for small employers.
• Program evaluations based on training uptake, worker retention, and business productivity.

2026-ongoing