If you’re in Ottawa, January is Kremlinology month, in which every news story, no matter how vacuous, is parsed for clues about what may be in the federal budget, usually delivered sometime between mid-February and late March.

(Note here to anyone at PMO or Finance reading this:  your attempt last year to disrupt HESA’s thorough budget-night coverage by making it coincide with Toronto FC’s home-opener was deeply unwelcome.  Fair warning: I will be incandescently angry if the budget is February 26^th, so schedule this puppy at your own peril).

Traditionally, the last budget before an election is packed full of goodies thereby forming the basis of the party’s election platform.  This time last year, it sure looked like pharmacare was going to be the issue they were going to run on. However, the Liberals have gone fairly quiet on this lately (whether because of cost or because they no longer think they have enough support in the provinces to make it happen is hard to tell, though I’d bet the latter).  Instead, beyond pretty much anyone’s expectation, the Liberals seem to be positioning the coming budget as a “skills budget”.

Now, I say “beyond anyone’s expectation” not because a skills budget is a bad idea, or because the impulses behind it (inclusive growth, not leaving workers behind due to technological change, etc.) are misdirected.  But it is beyond expectations because a) the feds have few tools to deal with this directly and b) even where they do have tools, there isn’t a lot of new thinking about how to employ them and c) the fact that Future Skills Centre has still not been announced/formalized 22 months after it was announced in the budget suggests that policy implementation in the skills area is not exactly Ottawa’s strong suit.  Plus, skills development is a provincial responsibility and has been for a couple of decades now, so if this is seen as “easier” than pharmacare from a political point of view, you know it’s likely because the feds are going to try to do something unilaterally, which is rarely a recipe for success.

There are a lot of bad ideas about what they could do in this space, and the House of Commons’ Finance Committee’s December report on “Cultivating Competitiveness” (which I’ll be dissecting tomorrow) is full of them.  But good ideas?  They are scarce.  If the issue is preventing industrial hollowing-out to stop (for instance) small-town southwestern Ontario from resembling Ohio and Michigan more than it already does, skills training doesn’t help much.  Read Amy Goldstein’s Janesville, which chronicles the fate of the eponymous town in Wisconsin after GM packed up and left a decade ago – those who took training (as opposed to moving to another city to look for work) actually ended up with worse outcomes.  Retraining may work in thick job markets (read: big cities) but in small towns it’s just irrelevant because there aren’t necessarily a lot of vacancies for them to train into.

The real problem here is that the skills conversation we are having is occurring during an era of record low unemployment in Canada.  We’re not really worried about mass unemployment, we’re worried about mass bad employment.  Crappy jobs with crappy pay.  And training can help with that to some extent, but for the most part it probably means employer-based (or at least employer directed) training.  This was the approach taken by the Harper government with respect to the Canada Jobs Grant. 

This could be complemented by other measures which puts training decisions in the hands of workers themselves: lifelong learning accounts to which government contributes, for instance.  France has recently introduced something similar, as has Singapore with its Skillsfuture initiative, though of course Singapore is pretty sui generis.  Versions of the idea have also been endorsed both by Dominic Barton-types and New Democrats (it was a big part of Guy Caron’s leadership campaign, for instance) so it has some wide appeal (though the crashing failure of a similar program in the UK in the late 1990s should underline the fact that there are practical problems involved with its implementation which need to be solved).

The other, potentially more interesting measure that could be taken would be to give workers a statutory right to time off for training.  Such an idea was floated 35 years ago by the McDonald Commission, which gave the idea the deeply unsexy name of a “time bank”.  This is something the feds could do which would be genuinely innovative, especially if paired with financial assistance like lifelong learning accounts, and not necessarily pout them at cross-purposes with the provinces (though it might well put them at cross purposes with business). 

I really hope that’s the direction the budget is taking.  But as I’ll show tomorrow, there is reason to be concerned that it’s not.