Backgrounder - Labour Market Development Agreements, Canada–Prince Edward Island Job Fund Agreement & Canada Job Grant

Labour Market Development Agreements

The Labour Market Development Agreements (LMDAs) represent Canada’s largest investment in labour market programs.  Each year, the Government of Canada provides over $2 billion in LMDA funding to the provinces and territories to support their programming for skills development and other employment services.

Funding is provided from the Employment Insurance (EI) Operating Account to support the costs of designing and delivering employment programs that help Canadians get back to work. With these funds, provinces and territories provide a full range of employment programs and services, ranging from longer-term skills training currentto counselling and job search assistance.

Through Budget 2016, the Government of Canada provided an additional $125 million for the LMDAs in 2016–17.

While the Government of Canada provides funding under the LMDAs, decisions regarding the delivery of employment programs and services are the responsibility of the provincial and territorial governments.  They have the flexibility to develop labour market programming best suited to their specific needs.

Canada–Prince Edward Island Job Fund Agreement

Since April 1, 2014, the Canada Job Fund agreements have played a big role in ensuring greater employer involvement in training. Nationally, the Government of Canada continues to provide $500 million annually to the provinces and territories for investments in skills training through the Canada Job Fund, which includes the Canada Job Grant.

Prince Edward Island is receiving over $2.2 million per year for six years (2014–20), its per‑capita share of the $500 million, and an additional $204,827 in 2016–2017 as part of the $50 million top up of the Canada Job Fund.

Canada Job Grant

The Canada Job Grant is helping Canadians get the training they need for available jobs and putting skills training decisions in the hands of employers. It can provide up to $10,000 in government contributions per person for training costs, such as tuition and training materials. Employers are required to contribute one-third of training costs.

By investing in the training, employers become partners in the skills training system and ensure that training is better aligned with job opportunities, particularly in sectors facing skills mismatches and labour shortages.

The Canada Job Grant is for short-duration training provided by eligible third-party trainers, such as community colleges, career colleges, trade union centres and private trainers. Training can be provided in a variety of settings, including in a classroom, on site at a workplace or online.

The Grant is flexible enough to meet the needs of businesses of all sizes, in all industries and regions. Small businesses may benefit from flexible arrangements, such as the potential to count wages as part of the employer contribution. This will help ensure that all businesses, regardless of size, can fully participate in the Canada Job Grant.

The provinces and territories have flexibility on the source of funds for the Canada Job Grant. They may be sourced from their allocations under the Canada Job Fund, the Labour Market Development Agreements or their own provincial/territorial sources.