This policy brief highlights what Alberta’s Budget 2023 means for the province’s digital economy. The annual budget is published in the spring and outlines the government’s spending priorities.

The Alberta government’s Budget 2023, tabled on March 1, made headlines for its proposed spending increases in education and health, which stakeholders say are needed to address inflation and the lasting impacts of COVID-19. In addition to education and health funding, the budget proposes $176 million to address labour market shortages in the province and $369 million to support Alberta’s Broadband Strategy. With a provincial election scheduled for the spring, the budget indicates what the government might prioritize if re-elected.

Economic Update

The province is cautiously optimistic about its financial position in the coming years. Despite acknowledging that a global economic slowdown is possible, Alberta remains confident that its current industries can provide the necessary revenues to invest in growing its regional economies. This optimism assumes a few key economic factors. First, the province expects fluctuations in oil and gas prices to moderate and the spread between the price of Albertan oil and its alternatives to diminish, creating stability for provincial revenues. The province also assumes that the Trans Mountain Expansion will be completed by year-end 2023, allowing for increased export potential. Last, the province acknowledges that its forecasts partially depend on slowing inflationary pressures, and by extension, a slowing of interest rate increases by the Bank of Canada.

Much of Alberta’s investment strategy depends on the province’s fiscal health and financials remaining strong. Should the next few years play out as expected, it will allow for more investment in clean technologies such as carbon capture and storage, and the diversification of the Alberta economy by supporting the development of its aviation and tech sectors (several private firms have recently also announced investments in sectors). In addition, the province announced a new argi-processing investment tax credit.

These investments by the province and the private sector will create a need for additional labour with the necessary digital and technological skills. Support for these sectors will also create opportunities for tech firms.

Policy and Programs to Support Canada’s Digital Economy

Alberta’s 2023 capital plan proposes to support Alberta’s digital economy by increasing support for in-demand skills training, expanding investment in Alberta’s Broadband Strategy, incentivizing workers and businesses to move to Alberta, and growing the province’s clean tech, clean energy, and agri-tech industries. A more detailed summary of the policy measures that will shape Canada’s digital economy is provided below.

Supporting Canada’s Innovation Economy

To support Canada’s innovation economy, the province proposes to invest $369 million over three years in Alberta’s Broadband Strategy, which would help connect businesses in remote areas. Expanding connectivity to rural areas would enhance the connectedness of rural Alberta businesses and support the adoption of ICT technologies. Rural industries rely on broadband connection to adopt innovative technologies and stay competitive in the global marketplace, however, the current lack of broadband connection continues to be a barrier for sectors like agriculture. Budget 2023 also proposes to renew investment in Alberta’s Technology and Innovation Strategy, which seeks to position Alberta as an internationally recognized technology and innovation hub. Meanwhile, the proposed funding for the province’s Digital Accelerator Program will digitalize government services, potentially providing procurement opportunities to local technology businesses. Notably, the budget does not reinstate the province’s digital media tax credit, which creative tech companies had been pushing for.

Supporting Workforce and Skills Development

Alberta’s budget proposes to address labour shortages for in-demand and emerging jobs. To support workforce and skills development, the Alberta government proposes investing $176 million to address labour shortages in key economic sectors and $111 million to expand post-secondary enrolment in programs tied to in-demand roles, such as non-trade construction, energy, technology, and business. Budget 2023 also announced commitments to support labour market demand in the aerospace, aviation, and logistics sectors, with $11 million for Mount Royal University’s Bachelor of Aviation program and $15 million to support training for aviation jobs.

The digitization of all sectors has exacerbated labour shortages in the province. The core focus on skills training in this budget signals the government’s intention to address skills gaps in Alberta’s existing and future workforce. Among other training programs, programs like ICTC’s EDGE UP 2.0 are helping to address digital talent shortages while supporting employers, job seekers, and educational institutes.

Growing Alberta’s Green Economy

Alberta’s 2023 capital plan proposes to invest $1.1 billion in agriculture and natural resources. In the natural resources sector, investments would promote environmental stewardship, enhance environmental remediation of oil and gas sites across Alberta, and attract investment in carbon capture technologies. Efforts are also in place to create a clean and circular economy, with investments focusing on the expansion of hydrogen production and plastics recycling.

The province continues to focus on the extraction of fossil fuels and efforts to expand pipelines to export liquified natural gas to new markets. That said, the budget proposes to invest nearly $800 million over three years from the Technology Innovation and Emissions Reduction (TIER) fund, which would help reduce emissions, support technology development, and create jobs and investment opportunities. The TIER fund aims to encourage economic development while reducing GHG emissions through increased investments in clean technologies.

As the province sharpens its focus on technology, capital investments are expected to accelerate Alberta’s digital economy. Improving the sustainability of Alberta’s agri-food and energy sectors is also likely to grow Alberta’s green economy, creating new jobs that are both sustainable and technology-enabled.

Connecting with International Markets

Foreign investment and international trade are a core focus of Alberta’s 2023 budget. The budget proposes $15 million annually to the province’s Investment and Growth Fund and $5 million annually to ongoing advertising campaigns to attract new businesses, individuals, and families to the province. These investments could help Alberta businesses become export-ready through capacity building initiatives and help attract more FDI to the province. The government also announced an Alberta Agri-Processing Investment Tax Credit, which would provide a non-refundable tax credit of 12% of eligible capital expenditures to corporations investing $10 million or more to build or expand agri-processing facilities in the province. Agri-food is one of the most innovative industries, contributing to strong technology job growth in the province. 

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This brief is part of ICTC’s policy updates series. ICTC provides timely updates on policy and political developments in Canada, including federal, provincial, and territorial elections campaigns, fall economic updates, annual budgets, and other major updates to policy and programs. Briefs are written by Allison Clark, Erik Henningsmoen, Mairead Matthews, Mansharn Toor, Justin Ratcliffe, and Todd Legere, with generous support from the ICTC Research and Policy team.