PEI’s Immigration Pendulum: Growth Strategy or Economic Constraint?
Prince Edward Island is currently living within two truths at once. For over 300 years, immigration has been an essential component of the province, yet it remains one of the most controversial topics in local discourse. Today, the Island faces a pivotal choice: continue with reactive, short-term pivots or commit to a coordinated, long-term growth strategy.
The Demographic Reality: A Province in Transition
Historically, PEI’s primary challenge wasn’t runaway growth; it was stagnation and the steady “leakage” of people to larger labor markets. Between 1891 and 1931, the population actually fell from approximately 109,000 to 88,000 due to global wars and outmigration.
Fast forward to the present, and the demographic landscape has shifted dramatically:
Negative Natural Increase: From July 2024 to June 2025, PEI recorded 1,375 births against 1,620 deaths, resulting in a natural decline of 245 people.
An Aging Population: Between 2015 and 2025, the number of seniors on the island increased by 42.2%.
Migration-Driven Growth: Despite natural declines, the population reached 182,657 by July 2025. This was fueled by a five-year growth rate of 14.7%—one of the fastest in Canada.
Without inward migration, PEI would face a shrinking labor force and mounting fiscal pressure on healthcare and social services.
The Current Policy: Triage vs. Strategy
In response to strained infrastructure and housing shortages, the provincial government has adopted a “triage” approach. As of January 21, 2025, new endorsement applications under the Atlantic Immigration Program have been strictly limited to three sectors: healthcare, construction, and manufacturing.
While this focus addresses immediate labor gaps, it risks “underscaling” the province in the long run. Critics argue that a healthy economy requires more than just tradespeople and nurses; it needs retail managers, digital workers, and entrepreneurs who drive broad-based growth and business succession.
“If immigration restrictions become the default substitute for faster housing delivery… the policy will begin to choke growth.”
The Path Forward: Coordinated Growth
To break the cycle of “haphazard pendulum swings,” the province requires a move toward an annual absorptive capacity framework. This model would explicitly link immigration targets to:
Housing completions and rental vacancy rates.
Infrastructure readiness, including school capacity and primary care attachments.
Regional settlement, ensuring growth isn’t just concentrated in Charlottetown but supports rural communities as well.
Furthermore, retention must move from an afterthought to the centerpiece of the strategy. Every immigrant who leaves within three years represents a loss of the investment made to settle and integrate them.
A Vision for 2030 and Beyond
While earlier projections suggested PEI could reach a population of 200,000 by 2030, current housing shortfalls have pushed that milestone closer to 2035. However, the long-term ambition should be even bolder. Some argue for a pathway to 400,000 people, using that target to build the necessary infrastructure expectations today.
Immigration is not what is choking PEI’s economy—poorly synchronized planning is. If managed properly, immigration will be the engine of the next generation’s prosperity; if suppressed out of caution, the province risks returning to the stagnation of its past.
How can PEI better align its housing policies with its demographic needs to ensure long-term stability?
This edition of the Business Edge is proudly sponsored by LaborMine, helping HR teams manage workforces proactively.
AI’s Abrupt Arrival: Is PEI Prepared?
The latest episode of The Business Edge podcast takes a hard look at the “abrupt” arrival of artificial intelligence (AI) on Prince Edward Island. Described as a wave “washing into our shores” from the Atlantic, AI is already making its presence felt across the province’s economy.
Beyond the Novelty: AI as Infrastructure
While some may take a “lazy” approach, viewing AI as a distant or isolated trend, the podcast argues for an honest perspective: AI is already here. Within the next 12 months, AI is expected to transition from a novelty to core operating infrastructure for businesses, government, education, and daily life.
The podcast highlights that even senior leadership in global giants like Coca-Cola and Walmart are stepping down, recognizing that the skills required for the upcoming AI age are fundamentally different from those of the past.
The PEI Context: A Service-Heavy Economy at Risk
The potential impact on PEI is particularly significant due to its heavy reliance on government infrastructure and service-sector employment.
Public Sector Vulnerability: Major employers like Veterans Affairs and the provincial government are identified as sectors where technology could potentially replace many roles.
The 50% Displacement Question: The podcast poses a stark question: What happens to the PEI economy if 50% of knowledge-based workers are replaced by AI-related technologies within the next four years?
Impact on Tax Base: With a significant portion of PEI’s tax revenue coming from personal income tax ($644 million) and sales tax ($519 million), a major shift in employment could substantially affect the province’s ability to fund public services.
Moving from Demo to Deployment
The shift is moving rapidly from AI “demos” to actual “deployment”. Statistics Canada recently reported that 12.2% of Canadian businesses used AI in early 2025, a significant increase from the previous year.
On PEI, this means AI will increasingly show up in everyday business processes:
Hotels using AI for dynamic pricing and customer sentiment analysis.
Professional firms (legal, accounting) using large language models to “chew through” and summarize massive documents in seconds.
Exporters utilizing AI for compliance, market intelligence, and follow-ups.
Global Thought Leaders on the AI Inflexion Point
The podcast references several AI visionaries to underscore the speed of change:
Peter Diamandis (XPRIZE): Predicts that by 2030, roughly 30% of white-collar jobs could be fundamentally transformed.
Jensen Huang (NVIDIA): States we have reached an “agent inflection point” where AI is moving beyond simple reasoning into taking autonomous action.
Dario Amodei (Anthropic) & Sam Altman (OpenAI): Both emphasize that extremely powerful AI is coming much sooner than many anticipate, moving from content generation to “capability delegation”.
Preparing PEI for the AI Future
To avoid being “victimized” by this technology, the podcast suggests several critical steps for PEI:
Local Training: Institutions like Holland College are already beginning to train the future workforce in AI and analytics.
Strategic Adoption: Local businesses should identify practical use cases (reducing errors, saving time) and implement them within a 90-day window.
Government Policy: The PEI government needs to move beyond generic innovation language and develop specific strategies for AI adoption, workforce training, and data governance.
Value Capture: PEI must ensure it doesn’t just become a consumer of AI, but a builder within the AI economy to keep financial value on the Island.
The core message is clear: If your organization isn’t looking at AI today, it’s likely already too late to avoid significant disruption. The challenge for Prince Edward Island is to apply this “agentic intelligence” to strengthen its existing sectors and protect its economic future.
This edition of the Business Edge is proudly sponsored by LaborMine, helping HR teams manage workforces proactively.
Current Crisis: Why Your Energy Bill Keeps Climbing
Energy is the lifeblood of any economy, but for Prince Edward Island, it has become a significant “existential” impact that businesses and residents alike must navigate. As global oil prices hover around $100 a barrel – with potential spikes to $200 due to Mideast instability – the direct input costs for transportation and heating are challenging the island’s competitive position.
Understanding Your Bill: The “Shell Game”
Electrical billing on PEI is divided into two primary components: consumption and connection. However, the way these costs are applied differs significantly between residential and commercial users.
1. Residential vs. Commercial Rates
Currently, residential users pay a base price of 17.23 cents per kilowatt-hour (kWh). In contrast, businesses face a higher first-block cost of 21.13 cents per kWh.
2. The Connection Fee Paradox
Every meter on a property incurs a monthly connection fee of $24.57. For commercial property owners managing multiple units, these fees can stack quickly, making meter consolidation a vital strategy for cost reduction.
3. Tax and Rebates
A few years ago, the provincial government enacted a 10% rebate for residential consumers to buffer against fluctuating prices. While popular, this rebate is essentially a “shell game” – residential users pay 15% HST but receive 10% back, resulting in a net 5% tax. Commercial enterprises do not receive this 10% rebate, though they can claim the 15% HST as an input tax credit.
A National Comparison
PEI remains an outlier in energy costs across Canada. The discrepancies are stark when compared to provinces with more robust domestic generation:
Sector
PEI Rate
Lowest in Canada
Difference
Residential
$0.1723 /kWh
$0.085 (Quebec)
~102% Higher
Commercial
$0.2113 /kWh
$0.0969 (Manitoba)
~118% Higher
The “Three Buckets” of Rising Costs
Islanders are currently on the cusp of further rate increases, driven by three distinct factors:
Point Lepreau Surcharge: Due to outages and refurbishments at the New Brunswick nuclear plant, islanders face a 7% increase (approximately $32 million).
Fiona Restoration: Maritime Electric is seeking to recover $37 million in costs from Hurricane Fiona restoration, proposing an annual increase of 2.4%.
New Generation Plant: The most controversial “bucket” is a proposed $427 million to $500 million diesel generation plant on the Charlottetown waterfront.
The Policy Paradox: Greening vs. Stability
The province faces a difficult contradiction. Government policies encourage “electrification” via heat pumps and Electric Vehicles (EVs), yet the peak demand in winter often leaves the grid in a “perilous near brownout situation”.
To maintain stability for hospitals and public safety, the utility must “refossilize” the system with diesel generators because the island lacks access to cleaner alternatives like Liquefied Natural Gas (LNG) pipelines.
“The generator project is where the debate stops being about a one-year surcharge and becomes a generational choice.”
Looking Forward: Can We “Hack” the Bill?
While PEI does not currently offer time-of-use pricing or net metering to adjust for peak load, efficiency remains the only lever within a consumer’s control. Flattening the “spike” in consumption during the 4:00 PM to 6:00 PM window – when ovens, dishwashers, and heaters all activate simultaneously – is essential for grid health, even if it doesn’t yet change the rate on your bill.
As we move toward a net-zero future, the question remains: How can PEI become more resilient and independent in an era of escalating costs?.
This edition of the Business Edge is proudly sponsored by LaborMine, helping HR teams manage workforces proactively.
The Million-Dollar Ceiling
In the latest episode of The Business Edge, host Blake Doyle cuts through the legislative fine print to expose a quiet policy shift that is having loud consequences for Prince Edward Island’s economy. The topic? The provincial government’s chronic overspending and its latest attempt to plug the gap: a doubling of the Real Property Transfer Tax (RPTT).
While the government may frame this as a “policy refinement,” Doyle argues it is a tax grab disguised as a luxury levy—one that fundamentally alters the cost structure of doing business in PEI.
The Hard Math: A Doubling of Costs
As of April 28, 2025, the RPTT rate doubled from 1% to 2% on properties valued at $1 million or more. On paper, a “million-dollar property” sounds like a luxury asset. In reality, thanks to inflation and rising housing costs, $1 million is no longer the benchmark for wealth it was five years ago.
The financial impact is immediate and severe. Under the old rules, transferring a $1.1 million commercial property incurred an $11,000 tax bill. Today, that tax burden has doubled, creating a significant new overhead for anyone looking to invest. Furthermore, PEI’s first-time homebuyer exemption—a critical tool for retaining youth—vanishes entirely the moment a property hits that $1 million threshold.
This policy isn’t just hitting wealthy homeowners; it is taxing the backbone of the island’s economy.
The Farm Exit Crisis: A typical 200-acre commercial farm with aging equipment often faces a valuation north of $1 million. Retiring farmers trying to sell are finding that young buyers are already squeezed by high interest rates and federal capital gains changes. This tax acts as yet another barrier to keeping farms in family hands.
Small Business Stagnation: Small businesses in PEI already pay property tax rates two to three times higher than residents. Faced with a doubled transfer tax, many owners may choose not to expand or reinvest. As Doyle notes, rational business people compare competitive environments; it is not a far trip to Moncton to find a more predictable investment climate.
The Market Response: The “999” Effect and Share Sales
As Doyle points out, “Business is rational. Where government creates friction, business finds solutions”. The market is already reacting to this artificial distortion in two distinct ways:
The “999” Effect: Real estate agents are reporting listings priced artificially at $999,999 to avoid the tax cliff at the million-dollar mark. This suppresses property values and creates a distorted market reality.
The Shift to Share Sales: There has been a spike in transactions structured as share sales rather than asset sales. By purchasing the company that owns the building rather than the building itself, buyers can often avoid the transfer tax entirely. However, this carries risk: buying shares means inheriting the company’s history, liabilities, and potential “skeletons”.
The Bottom Line
The government defends this as a tax on those who can afford it, but the reality suggests it is a desperate measure to cover unsustainable growth in public expenditures. By targeting a price point that now represents standard farms and functioning small businesses rather than true luxury, the province risks creating a “chilling effect” on the commercial sector.
“What we need to do is spend less,” Doyle concludes. Until the government confronts its spending problem, businesses will continue to face creative new taxes—and capital will continue to look for friendlier shores.
Bureaucracy vs. Bedside: PEI Healthcare is Breaking
By the Business Edge Editorial – Dec 3, 2025
It is the single biggest line item in the provincial budget, and it is growing at a rate that defies sustainable economics. Healthcare in Prince Edward Island is no longer just a service issue; it is a structural crisis.
In the inaugural episode of Business Edge 2.0, analyst and publisher Blake Doyle issues a stark warning: The system is at a “serious crossroads.” While politicians celebrate ribbon cuttings and new medical schools, the operational reality tells a different story—one of a workforce under pressure, a ballooning deficit, and an administrative apparatus that is expanding faster than frontline capacity.
Here is the deep dive into the state of PEI’s healthcare operations, the “administrative paradox,” and the six critical steps required to avoid a financial abyss.
On paper, the government appears to be moving at lightning speed. Under Premier Dennis King, the province has launched a medical school, reconstituted the Health PEI board, and opened community-based care hubs. However, Doyle argues that speed is not always a virtue.
The numbers are alarming:
Explosive Spending: Historically, healthcare spending climbs 5-8% annually. Recently, it jumped over 14%.
Budget Consumption: Healthcare now consumes 34% of the provincial budget.
Deficit Reality: This spending is occurring within a budget already running an $85 million deficit.
The core critique is that the province is expanding bureaucracy and pushing shiny initiatives—like the medical school—without first stabilizing the current delivery system. As Doyle notes, “Not all progress is actually progress. Some of it is political theater dressed up as reform.”
The Administrative Paradox
To understand the current strain, we must look at the structural history. In 2010, Health PEI was created as a single authority to streamline care. The philosophy was sound, but the result has been “structural drift”.
We have moved from consolidation to an “increasingly heavy administrative apparatus” defined by more managers, committees, and coordination meetings.
The mismatch: Administrative growth has outpaced clinical capacity.
The instability: The organizational structure shifts constantly, with roles rotating so frequently that accountability is diluted.
This bloat slows down decision-making. Doyle suggests a freeze on administrative hiring to redirect those funds into clinical roles, noting that technology could handle many of the tasks currently overburdening the bureaucracy.
The Human Capital Crisis
PEI’s biggest healthcare problem isn’t infrastructure; it is people. The workforce is facing burnout, and the province is struggling to retain talent.
While the 2024-2025 budget allocates millions for recruitment and retention, the strategy is fundamentally flawed because it relies on short-term incentives.
The Salary Wars: PEI cannot win a bidding war. A $10,000 bonus is ineffective if Nova Scotia offers $30,000 more, or if Alberta doubles the offer.
The Culture Factor: We cannot outpay larger provinces, so we must “out-innovate them in culture, community, and autonomy.”
This isn’t just about complaining; it’s about survival. If PEI wants to avoid becoming the “most expensive failed” system in Canada, Doyle proposes six aggressive operational changes.
1. Adopt AI Aggressively
The future is data. AI shouldn’t replace clinicians, but it should replace bureaucracy. Tools for predictive diagnosis, patient monitoring, and workforce allocation are available today and must be adopted to improve decision-making.
2. Prioritize Home and Community Care
Hospitals must be the last point of contact, not the first. While community care hubs are a step in the right direction, their implementation needs to be accelerated and properly resourced.
3. Build a “Sticky” Workforce Pipeline
The new medical school is a massive investment, but it currently lacks a “return of service” commitment. Doyle argues that a return commitment for PEI medical grads should be a prerequisite for admission to ensure the province benefits from its investment.
4. Modernize via Public-Private Partnerships
This is not about privatization; it is about modernization. The system needs to work outside the “bureaucratic bubble” and leverage private sector agility to solve public sector problems.
5. Fund Preventative Care
The economics are simple: Every dollar spent on prevention saves three to four dollars down the road.
6. Shift to Outcome-Based Funding
Stop paying for volume and start paying for health. The system should reward improvements in Islander health, not simply the production of more services.
The Bottom Line
PEI is perfectly sized to be a model jurisdiction—agile enough to beta-test solutions that larger provinces can’t touch. However, this requires a shift from political ambition to operational reality.
As Doyle concludes, “We can become the most innovative small healthcare system in Canada, or we can be the most expensive failed one.”
Debt and the Island’s Financial Crossroads
Introduction: The State of the Ledger
Welcome back to Business Edge, where we take a hard, practical look at issues shaping Prince Edward Island, the business climate, and our economic future.
I’m your host, Blake Doyle. Today, we are tackling a topic that may not be flashy, but is fundamental: PEI’s growing provincial debt and what it means for taxpayers, small businesses, and the next generation of Islanders. This isn’t just a story about numbers; it is a story about priorities, principles, fiscal management, and the very real risk of losing our economic autonomy if we don’t correct course.
This marks the inaugural kickoff of the Business Edge 2.0 podcast, which is now available in both digital format and written words on the Island Dew.
The Fiscal Reality
Our debt has increased by approximately 100% in a ten-year period. This is a major concern for future generations and current residents, as the burden of managing this debt will inevitably lead to a stripping of services if we don’t get our fiscal house in order.
We have been living beyond our means for quite some time, and the debt per capita has begun to grow by double digits.
Warnings from the Watchdogs:
The Auditor General: PEI’s Auditor General, Darren Noonan, has noted that the Island’s fiscal position is becoming increasingly fragile. He has flagged concerns regarding overspending, a lack of fiscal controls, and a growing reliance on federal transfers to keep the books balanced.
Federal Reliance: As long as our hand is out expecting others to manage our financial affairs, we are at risk. Alberta is already questioning the fiscal imbalance and the amount of money sent to other provinces. Relying on Ottawa to fill the gap is a fragile approach to fiscal administration.
External Analysts: The Canadian Taxpayers Federation (CTF) and the Fraser Institute have highlighted PEI’s rising public sector spending, cost overruns, and a debt trajectory that outpaces both population and economic growth.
The Erosion of Capital
A few years ago, Premier Dennis King restricted our volume of immigration, which affected the economy, investment, and human capital. Consequently, we have lost three essential elements of capital:
Human Capital
Investment Capital
Knowledge Capital
Post-secondary institutions are now relying more heavily on the provincial government—a government that spends more than it makes and relies on others for management. The entire financial ecosystem is unpredictable.
For an island of our size, this is alarming. We don’t have Ontario’s economic engine or Alberta’s corporate tax base. When we overspend, every dollar is carried on the backs of everyday Islanders—from young workers to retirees.
Debt is Delayed Taxation
Let’s be blunt: debt is just delayed taxation, and it always comes due, usually with interest.
The CTF warns that once governments normalize structural debt, taxpayers face long-term consequences: higher taxes, cuts to essential services, and reduced investment in roads, schools, and healthcare. Small businesses already operate on razor-thin margins; adding higher taxes or reduced services erodes competitiveness quickly. Rational investors will simply move their capital elsewhere.
The Numbers:
Total Debt: Increased nearly 68% between 2018-2019 and today. It stood at $2.2 billion in 2018 and will exceed $3.56 billion by the end of this fiscal year.
Debt Load: PEI’s debt load now exceeds annual government revenues.
Per Capita Debt: In 2018-2019, every Islander owed roughly $13,950. This year, that ballooned to $19,500.
Future Projections & Autonomy
The provincial government currently has no plan to return to a balanced budget and intends to add debt for the next three years.
2027-2028 Forecast: Total debt will hit $4.23 billion.
Per Person Increase: Debt is forecast to rise to $22,300 per person by 2027-2028.
Debt Servicing: In 2025-2026, 5.1% of our GDP went toward debt. By 2027-2028, this grows to 6.5%.
Auditor General Noonan warned that excessive reliance on federal transfers shrinks our policy flexibility. When your operating budget depends on someone else’s wallet, you lose the ability to chart your own course, innovate, and respond to local needs.
The Competitiveness Crisis
The Fraser Institute’s Ben Eisen notes that Islanders face high tax rates that deter investment. PEI needs ambitious tax reform to remain competitive.
Marginal Tax Rate Comparisons:
At $50,000 Income: PEI’s rate is 13.47% (3rd highest in Canada). Ontario is just 5.05%.
At $75,000 Income: PEI’s rate is 16.67%—the highest in the country.
At $100,000 Income: PEI leads again with 17.5%. In comparison, Ontario is 10.98% and Alberta is 10%.
Furthermore, PEI is the only province that does not index its tax brackets, a measure consistently proposed by local Chambers of Commerce.
A Call for Fiscal Courage
This situation is challenging, but not dire—if we act. We need political will and fiscal courage.
A Business-Minded Approach to Solutions:
Restore Spending Discipline: Governments must operate with the prudence expected of businesses and households.
Prioritize Outcomes: Funding should follow performance, not political optics. We must stop building infrastructure we cannot afford to operate.
Strengthen Financial Controls: When the Auditor General flags issues, we must fix the system rather than make excuses.
Rebuild Autonomy: We must reduce our structural dependency on federal transfers to ensure our independence.
Conclusion
Looking back, balanced budgets are rare but possible. Pat Binns balanced the budget several times between 1997 and 2006. Wade MacLauchlan managed a small surplus in 2018-2019. Dennis King inherited strong footing and balanced the books in 2022-2023, but since then, debt has exploded.
If you feel the government is not representing your interests or prioritizing fiscal responsibility, let them know. If they refuse to address these priorities, they can be replaced. Continued overspending impairs our environment, drives away capital, and limits the opportunities of future generations.
Thank you for tuning into the revised Business Edge 2.0.
Social Media Phenomenon
Social media is a much misunderstood business phenomenon. There are those who just see no relevance in the voyeuristic time-vacuums of on-line social engagement. Then there are others who are creating professions prophesying the relevance of being digitally socially engaged.
There are many social media mediums; from QQ and Renren in China to Facebook, Linked-in or Twitter in North America. Many opportunities or many distractions, depending on your perspective.
With an election underway and another pending, social media will become an increasingly critical tool for those trying to influence the masses. Like it or not, expect to be socially spammed and lobbied electronically.
This past week I received an e-mail from Reid Hoffman, perhaps many others also received a similar message. Reid Hoffman is the founder and Chairman of Linked-in, in my estimation the premier business social media application.
Mr. Hoffman was announcing that Linked-in had just surpassed 100 million subscribers. (I was number 35,351 about a decade ago). Currently 41 per cent of members on linked-in are female and 59 per cent are male. Twenty-one per cent are between 18-24 yrs of age, 36 per cent are between 25-34 yrs, 36 per cent are between 35-54 yrs with only 7 percent 55 yrs or older. Full 72 per cent between 25-54; a very mature and marketable group.
For anyone who has recently watched the movie The Social Network, it is hard to imagine that in only seven years the power of this application has managed to topple governments in the Middle East.
Today there are more than 500 million active users engaged with Facebook. Fifty per cent of active users log on to face book in any given day. The average user has 130 friends; collectively people spend over 700 billion minutes per month on Facebook.
Entrepreneurs and developers from more than 190 countries build on the Facebook platform. There are more than 200 million active users currently accessing Facebook through their mobile devices. In 2011 social network spending is estimated to reach $6 billion, according to e-marketer.
Facebook had topped Google, Yahoo and Microsoft for user engagement in 2010. Ninety-six per cent of the world’s population under 30 years of age has joined a social network. One-in-Eight couples married in the US met via a social network. Like it or not, this phenomenon does have some momentum!
These stats are revealing as to who is using Facebook: Barack Obama has 18,913,409 Facebook fans, Lady Gaga has 31,277,377. Stephen Harper has 44,195 people who like his page, Michael Ignatieff has 42,630; SpongeBob Square Pants has 19,158,703. (Too bad SpongeBob was not on the ballot).
Twitter is five-years old. There are 1 billion tweets posted per week, as recently as March 11th, 2011 there was 177 million tweets posted on that single day.
The Internet does provide great opportunities for those of us isolated in geographically rural areas like Prince Edward Island. Perhaps too does social media. To quote Eric Qualman, “We don’t have a choice on whether we DO social media; the question is how well we DO it.”
Get the Most from your Human-Capital Investment
How important are people to the operation of your business? Are you getting the most from the investment which is, arguably, the most important asset your company has? Are your people committed to your organization – are you committed to your people?
Treating employees well may be one of the most critical variables to keeping people motivated and productive. Some studies suggest that only 24 percent of those in the workplace are really engaged in their job; a shocking 76 percent are not engaged. How effective and productive are employees who are not fully engaged?
What are employees looking for? For certain they want to be treated fairly and with respect. This is a concept that will improve employee retention if sincerely adopted by the hiring organization.
Business organizations are now expanding their energies toward preserving their investment in people. Why is this occurring? Organizations are finally realizing the economic costs and time investment put into the recruitment and training of employees. Once this investment has been “sunk” into creating valuable employees, this asset must be preserved. The costly alternative is to invest again in the recruitment and training cycle for replacements.
Businesses are motivated to retain the services of any asset for the expected useful life of that asset. Organizations recognize the importance of human capital (people) and that this is an invested asset which should be maintained with as much care as any other key asset class.
There have been many human resource models created to support the identification, selection and retention of employees. One of the most straight forward and pragmatic approaches was developed by Kevin Kelloway, a professor and researcher at Saint Mary’s University in Halifax.
Kevin uses the acronym HTML as his guiding principal for keeping good people. HTML, as many will recognize, is the open standard that allows information to be displayed over the Internet. In a similar fashion, HTML, as used in human resources, is also an open system that can be applied to any organization in the public, private or non-profit sectors.
HTML stands for: Hire the best, Treat them well, Manage performance, and provide Leadership. Any leader who follows this mantra will ensure a qualified team of committed professionals are working to achieve common objectives.
Hiring the best employees should be an objective of any organization. If you don’t have the best candidates, then you cannot expect optimal performance. When Jim Collins, author of “Good to Great”, analyzed companies that developed from good organizations to exceptional performers, he ranked hiring the best people ahead of strategy or any other managerial action. Hiring the best people is recognized as a critical factor in success.
Treating people well is a universally understood statement. People respond well to a good environment and will perform to the extent of their capabilities when they feel appreciated.
Managing performance is an issue that most managers have some difficulty with. Measuring and rewarding performance is an awkward responsibility that few relish. Setting specific, challenging but attainable goals is an effective method to establish performance standards and gauge success attainment.
Finally Leadership, it is the leaders’ responsibility to provide a safe and stimulating environment. The leader must encourage the growth and productivity of the people they are responsible for. Without good leadership even the best resources cannot achieve maximum efficiency. Transformational leadership measures effectiveness in terms of motivating employees and challenging them to increase performance.
Dr. Kelloway offers a closing comment that accurately summarizes this approach, “Common sense is not always that common and the HTML acronym helps us to remember what truly matters in managing people. Hiring the best, treating them well, managing performance and leadership are the principles that work in organizations of all shapes and sizes, in all industries and at all levels.”
The Business of Giving
Having just survived the frenzied fall season of solicitation as both a collector and donor, I thought it would be appropriate to examine how Islanders respond to the barrage of requests for donations. Statistics Canada keeps tabs on what is reported but there are countless activities that go unrecorded due to the size and method of the donation.
The first source of information to examine is the Fraser Institute’s annual “Generosity Index”. In 2005, this index focused on two primary measures the percentage of tax filers who donated to registered charities and the percentage of all personal income donated to charity. This study concluded that Canadians are less generous than our American counterparts on both accounts. Keep in mind; Americans also have a much lower taxation burden which may account for increased disposable income and a greater tax advantaged propensity to give.
The study also reveals some characteristics of those who give. On Prince Edward Island, 25.9 per cent of people who filed tax returns made charitable donations. This generosity allows Islanders to rank fourth in the country behind Manitoba, Ontario and Saskatchewan. We also donate roughly 0.72 per cent of our annual income.
Although Islanders do not donate as much per person as some of our provincial counterparts, our donations as a percentage of income has steadily increased over the last number of years. This generosity may be explained by our smaller and closer communities and our general willingness to support community fundraisers in aid of special causes. For instance, benefits in aid of individuals, group activities or centers of interest such as local hospitals.
In comparison, when Statistics Canada’s most recent information is examined, Islanders are shown on average to be moderately more generous than the national average. The average charitable donation per person across Canada is $230, while on Prince Edward Island it is $340 annually. This amount appears even more generous when one compares the Island annual median income of $35,000 to the national median of $44,000.
Donations are a vital source of revenue for most charities. The generosity of Islanders is impressive and consistent. However, the funds available for charitable giving is finite and organizations must be increasingly creative to capture a share of this pie. The more creative the organization, and the more dynamic the team of fundraisers, the more successful the organization will be in raising money. Charitable giving has transformed from a loosely structured cause to a well-managed business.
The next evolution for the enterprise of charitable donation is Social Entrepreneurship (more on this in subsequent articles) where creative entrepreneurs offer their business expertise for the benefit of a socially conscious charity. When business aligns with charitable causes the results are often self-sustaining charitable enterprises and a much-enhanced opportunity to accomplish the objectives of the charity.
Businesses are motivated to support the community in which they serve; the more vibrant the market area, the greater the potential for profit. This obligation is accomplished through multiple levels of taxation. In addition to taxes paid many businesses do support charitable community initiatives.
The personal benefits of making a financial contribution go beyond the gratification of assisting a cause of interest. There are taxable benefits to making contributions as well. Depending on your personal income and the amount of your donation from 25.8 per cent to 32.7 per cent of your total charitable contributions may be deductible from your taxes payable. The maximum allowable amount of donations in a given year is 75 per cent of your income.
There are many dimensions to generosity and charitable donations, but at the end of the year Islanders remain among the most generous in the country.
How to Improve Your Organization – Hire More Women
I am sure this headline will have all the men’s activist groups lobbying me; so let me explain.
I came across a study completed by Anita Woolley, Carnegie Mellon University, and Thomas Malone, MIT Sloan School of Management, which suggested adding women to teams, makes the teams smarter. As a father of three daughters I was intrigued (but with one son, I remained 25 per cent skeptical).
The study looked at 192 distinct teams. The findings suggest that there is little correlation between a groups collective intelligence and the individual team members IQ’s. However, if you add more women to the team, the collective intelligence rises.
Collective intelligence of a team is not simply a reflection of how intelligent the individual members of the team are, but how intelligent the team becomes through the impact of the team members.
The authors confirm that group diversity is good, but groups of women tend to be smarter than groups of men. (I am happy for my daughters, but feeling a little personally snubbed).
Like myself, you may be wondering on what grounds could such a statement be made. It seems that social sensitivity is very important to group performance. Women tend to score higher on social sensitivity tests; but gender may not be as relevant as how socially sensitive the group members are.
When you hear about hyper-performing teams, you tend not to hear how smart the individuals are but how well they listen to each other, how open they are, how they share criticisms constructively. This is well documented in successful sports teams.
The benefit of this research is to carefully design teams that perform better. Can a group’s intelligence be changed by weighting gender or providing incentives for collaboration?
Does this research extend beyond small groups? Can it be applied to family dynamics, entire companies or even cities? The challenges of face-to-face collaboration increases as the size of the group increases; but perhaps technology can overcome the issues of scale? Consider how Google harvests knowledge or distributed platforms like Wikipedia achieve high quality products with no central control.
Men, rather than assume this research is placing us under siege; consider different methods of collaboration. Examine how we operate in groups and how we might be able to improve our performance by being more sensitive, open and considerate.
In business performance and productivity are what differentiates and creates success. If this study can improve the potential for greater performance and outcomes then it is worthy of evaluation.
