Government funding for Apprenticeships in Canada

As Canadian businesses become more innovative and technology-driven, employers are finding it increasingly difficult to find the skilled workers they require. Most industries are feeling the effects of this widening skills gap, perhaps few more than the manufacturing sector where upwards of 35% believe they do not have sufficient talent. These gaps will continue to grow over time unless government, businesses, and skilled workers can develop a system for improving employee skillsets.

Paid apprenticeships have become an increasingly popular method to help businesses fill their skill gaps. Apprenticeships often pair a younger or less skillful employee with a certified tradesperson who assists the development process. After several years of integrating practical and classroom learning experiences, it’s expected that the apprentice will be full prepared for a career in their given skilled trade.

Fortunately, government funding for apprenticeships is widely available to employers and apprentices alike. There are several grants, loans, and tax incentives designed to support paid apprenticeships. These programs provide support for employers and apprentices alike to encourage the training of more skilled tradespeople in Canada.

Paid Apprenticeships are an Effective Recruitment Method

Some employers are hesitant to provide apprenticeships because they feel it will take too long for their apprentice to become certified, that it will be too costly, or that once training is done, the apprentice will leave the company. These assumptions are often unsubstantiated; in reality, paid apprenticeships are one of the most reliable recruitment methods available.

British Columbia’s Industry Training Authority (ITA) shed light on why hiring and training an apprentice to become a registered journeyperson is a smart business move:

  • Apprenticeship training provides a return-on-investment (ROI) of $1.47 for every $1 spent;
  • Apprentices learn your business’ processes before being exposed to other (and potentially inaccurate) processes;
  • Apprentices will grow to be a better fit for the company and deliver on customer expectations more accurately; and
  • Apprentices will have better health and safety performance, greater productivity, and make fewer mistakes.

Government Funding for Apprenticeships in Canada

Although leveraging apprenticeships is a smart move on its own, the process can become even more enticing when some of the costs are recovered through grants, loans, and tax incentives. Both employers and employees can apply for government assistance, which can drastically reduce the cost of apprenticeship training.

Apprenticeship Funding for Employers

Businesses experiencing skills gaps should consider using government funding programs to hire and train apprentices. Most apprenticeship programs support the hiring and training of multiple apprentices, so the more opportunities provided, the more funding is available.

Apprentices should inform unaware employers about government funding programs, since additional funding can lead to better training and could reduce the amount of time needed to become a tradesperson.

Some of the most popular apprenticeship funding programs for employers include:

  • Apprenticeship Job Creation Tax Credit: Up to 10% of eligible salaries and wages paid to apprentices after May 1, 2006 to a maximum $2,000/year/apprentice. Any unused credit can be carried back 3 years and carried forward 20 years. Eligible apprentices must be working towards certification in one of the Red Seal Trades.
  • Graduated Apprenticeship Grant for Employers: Up to $16,700 per apprentice or up to $19,200 if the apprentice is from an underrepresented group, including women, Indigenous peoples, people with disabilities, newcomers and visible minorities, and Francophones. GAGE funding payments are then triggered when apprentices reach training milestones. Employers must be based in Ontario and employ apprentices registered in any of Ontario’s approved trades.
  • Apprenticeship Completion Employer Bonus: Up to $1,000 in grant funding for each apprentice employed/trained who completes their apprenticeship. Employers must be based in Ontario and employ apprentices registered in any of Ontario’s approved trades. Grant funding applications must be submitted no later than 180 days following the completion of an apprenticeship.

Apprenticeship Funding for Workers

Likewise, apprentices may receive government funding to help offset training and equipment costs. While these programs are solely the responsibility of apprentices to apply for, employers should consider prompting their apprentices to receive them.

Some programs specifically for apprentices include:

  • Apprenticeship Incentive Grant: Up to $1,000/year/level of training completed, to a maximum $2,000. As with most grants, there is a deadline to apply for the program; apprentices should consider applying by June 30 on the year level 1 or 2 is completed. Eligible apprentices must be completing training for one of Canada’s Red Seal Trades.
  • Canada Apprentice Loan: Up to $4,000 in loans/period of training completed in a Red Seal Trade apprenticeship program. Loans may be awarded for up to 5 periods ($20,000 maximum program contribution) and loans are interest-free for up to 6 years, as long as the apprentice is still registered in an eligible training program.
  • Apprenticeship Completion Grant: Up to $2,000 for apprentices who have completed Red Seal Trade training and have obtained their journeyperson certification. Like the Apprenticeship Incentive Grant, applicants must apply by June 30 after certification is obtained.

Develop a Proactive Plan for Hiring and Training Skilled Workers

Apprenticeship grants, loans, and tax credits are just a few of the government funding programs employers can use to reduce skills gaps. Forward-thinking businesses apply for hiring and training grants on an ongoing basis to build an intelligent, skilled pool of talent.

Download Mentor Works’ free How to Build a Proactive Funding Plan™ slide deck to learn how to optimize the amount of Canadian government funding for projects.

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Posted: May 11, 2017 by Jeff Shepherd. Updated: December 7, 2017 by Jeff Shepherd

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Jeff Shepherd holds an Honours Bachelor of Business Administration at the University of Guelph. He is passionate about Canadian business, economics, and politics. As Marketing Coordinator for Mentor Works, Jeff educates business leaders about proactive funding strategies.