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Conservatives feel heat over fragile job market

Feeling the heat over a fragile jobs market, the Conservative government is ramping up efforts to promote its existing labour programs in the face of criticism that it's not doing enough to fight rising unemployment.

As those who have jobs make their morning commute on Tuesday, Finance Minister Jim Flaherty will be at Buster's Bar and Grill in Ottawa for an 8:45 a.m. event highlighting the Hiring Credit for Small Business, which his government launched in the budget of June, 2011.

Conservatives are going to great lengths to promote the credit even though it is set to expire in less than three months. It is back on the agenda because Mr. Flaherty is introducing a second budget bill on Tuesday that includes details on measures, like the credit, that were approved in the budget but were not included in the original legislation.

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The Prime Minister's Office issued an internal memo on Sunday strongly encouraging MPs and Senators to promote the credit.

Mr. Flaherty's budget-related bill will not include any new job measures, meaning it will likely do little to quiet the daily attacks from the opposition calling on the Conservatives to act now on jobs.

The Hiring Credit for Small Business, which is worth up to $1,000 per new hire, applies only to the 2011 calendar year. However, the Canadian Federation of Independent Business said the Conservatives are increasingly receptive to its call for an extension.

"I'm cautiously optimistic the government will reintroduce the credit based on the degree of concern over the economy," said Dan Kelly, the CFIB's senior vice-president of legislative affairs. "We've made this point in many meetings."

Jobs jumped to the front of the fall political agenda as economic growth slowed over the summer and the unemployment rate inched upward. Job numbers for August showed a decrease of 5,500, pushing the unemployment rate to 7.3 per cent.

Statistics Canada job numbers for September will be released on Friday. A Bloomberg survey found that economists are expecting to see 15,000 new jobs for the month, and that the unemployment rate will remain at 7.3 per cent.

However, not everyone agrees that short-term hiring incentives are the best way to create jobs.

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Jayson Myers, president of Canadian Manufacturers and Exporters, says that while past Conservative labour moves such as job sharing and skills training were successful, his members aren't talking about the hiring credit.

"I'm not a great believer in subsidizing employment for the sake of creating jobs because I don't think that's successful in the long term," he said. Companies are concerned, he said, by the fact that employment-insurance premiums are scheduled to increase on Jan. 1.

"Anything that is an additional cost, especially at this time, is something that's difficult to manage," said Mr. Myers.

NDP interim leader Nycole Turmel and Liberal interim leader Bob Rae once again led off Question Period on Monday with calls for new action on jobs.

"If the Prime Minister was serious, he'd table a real action plan to create jobs, not half measures," Ms. Turmel said.

Mr. Harper and Mr. Flaherty have ruled out the idea of a second budget for 2011, meaning decisions on whether Ottawa needs to alter its fiscal plan likely won't be announced until the 2012 budget.

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"They're desperate to show that they're doing something," Mr. Rae said of Conservative efforts to highlight 2011 budget measures. "But their problem is that the situation over the summer has deteriorated dramatically compared to what it was."

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About the Author
Parliamentary reporter

A member of the Parliamentary Press Gallery since 1999, Bill Curry worked for The Hill Times and the National Post prior to joining The Globe in Feb. 2005. Originally from North Bay, Ont., Bill reports on a wide range of topics on Parliament Hill, with a focus on finance. More

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