OTTAWA — Canada’s high-tech sector says the federal government is taking the right step by reaching for economic stimulus, but asserts that the amount of stimulation should be double what’s in the current budget, and needs to be invested in "jobs for the future", in transformation, not bail-outs.
The 33,000-member Canadian Advanced Technology Alliance (CATA) estimates that at least $60-billion needs to be spent “to match the intensity of the American response to what is clearly perceived by the American President Obama as an emerging depression,” says a CATA press release.
"While we are pleased to see the government heading our call for economic stimulus, we need two more success ingredients," said CATA President John Reid, in a press release. "First, we need to treat this crises with the same depth of concern as President Obama, which for Canada means an investment of more than $60-billion.
"Second, we need to invest the funds in jobs for the future. The Americans may have learned their lesson and be more willing to spend, because they underestimated the global financial crises at first. Now they — and we — are in much more serious trouble. If a nation doesn’t react with enough force, the crises deepens," added Reid.
"The Americans will be investing in jobs for the future — those sectors which are largely knowledge-based, with leverage to enhance productivity. We cannot let the Americans fast-forward like this, without a response. Here, Canada is presented with a huge opportunity: we can also transform our economy by judicious but adequate spending on ‘jobs for the future’," added CATA executive vice-president Barry Gander.
Some 60% of recently-polled high-tech executives urged Canada to keep up with the example of our American neighbours… Almost three-quarters of the executives felt that if the current situation continues, their businesses would decline or be "badly wounded".
The advanced technology executives are the advance guard of the service economy, which makes up 76% of all jobs and 69% of Canada’s GDP, according to CATA. “Spending on job sectors employing high tech delivers fast growth, immediate employment, recession-resistance, and improved productivity,” reads the release.
CATA advised government to consult immediately with industry to prioritize the projects that would create the best long-term value for stimulus spending in terms of future, sustainable, employment.
CATA members want to see spending on smart Infrastructure development, which includes networks to link vehicles to themselves and ground services, city-wide wireless access for mobile devices, the provision of online services for communities and other public sector organizations, innovations in the services sector, and the creation of advanced materials.
They also want to see spending on traditional infrastructure development, green technology, alternate energy; and healthcare
Spending on the scale of World War II is needed to break the downward spiral of a constricting economy, says CATA. "If our neighbours the Americans are not spending, we are not producing," said Gander. "We need to break the spiral by spending on ourselves. In all sectors, our ‘spending on ourselves’ should follow the rule that the parts of a sector that have a significant and growing information and communications technology (ICT) component are good bets for investment.”
The ICT component of Canada’s economy is one of the country’s strongest performers as it features fast growth, where average annual growth rates since 1997 have been more than double those for the overall economy.
Plus, it is a large sector comprised of nearly 32,000 companies. ICT sector employs close to 600,000 people and contributes $133 billion in revenues to our economy.
It is recession-resistant, believes CATA, since it has a longer lag-time built into it for periods of downturn and offers high productivity value
It’s also a global industry which brings in investment, boosts employees and causes returns to government.
"With all these advantages, and the compelling need for the right level of spending, we will be creating human assets that will have the most to do with our global competitiveness five years down the line," added Reid. "We can demonstrate that putting the infrastructure investment into knowledge-intensive services sector jobs will help Canada most, by driving job creation, exports and long term sustainable competitiveness.”
