The federal government says Nokia’s new Ottawa expansion will create more than 300 jobs as part of a $40-million publicly funded research and development push. But not everyone is convinced this is a win for Canada.
At a groundbreaking event in Kanata yesterday, several cabinet ministers highlighted Nokia’s plan to expand its lab facilities and add new R&D projects involving artificial intelligence, machine learning and next-generation 5G technology.
Ottawa is putting $40 million toward the project through the Strategic Response Fund, while Ontario will add $30 million, plus $2 million more from municipal subsidies in a $72 million taxpayer deal.
Tobi Lütke, CEO of Ottawa-based Shopify, responded directly to Industry Minister Mélanie Joly on X today with a sharply critical take on the funding model. He argued the government is effectively “bribing” multinational companies to set up jobs in Canada using taxpayer money.
“What you are actually doing here is to bribe Nokia to put these jobs into Canada by paying hundreds of thousands of dollars per job from taxpayer money,” Lütke wrote. “What this does is to lower the cost basis of Nokia per employee.”
Lütke said this subsidized approach hurts Canadian tech companies because foreign branch offices benefit from lower effective labour costs than homegrown firms. “It’s strictly worse inside of Canada to be a Canadian company compared to a company headquartered everywhere else,” he said.
He also warned that subsidizing knowledge-economy roles comes with long-term consequences. “The fruits of the subsidized labor will accrue to the wealth of other countries and not Canada,” he wrote, adding that these policies lock scarce tech workers into roles that do not directly benefit the Canadian economy.
Lütke noted that while subsidies can make sense for manufacturing, energy or large infrastructure projects, “it’s just a total braindead idea to do this with knowledge jobs.”
The controversy comes as Ottawa faces growing backlash over its record of high-stakes corporate deals. The federal government is still dealing with the fallout from its Stellantis agreement, which included up to $529 million in federal funding from 2022 to upgrade plants in Brampton and Windsor, plus more than $15 billion in incentives for EV battery production under the NextStar joint venture.
That deal has since unraveled. Stellantis announced last month that it is shifting Jeep Compass production to the United States, violating job-protection clauses and putting roughly 3,000 unionized Canadian jobs at risk. On November 3, Industry Minister Mélanie Joly launched a 30-day dispute resolution process to recover taxpayer money and force production back to Canada.
Tensions escalated even further on November 25 when Stellantis executives failed to show up for a parliamentary hearing, citing technical problems. MPs from all parties rejected the explanation, condemned the no-show, and voted to issue a summons.
Blackrock’s Reporter came out today to claim Joly didn’t even read the Stellantis contract.
The failed Stellantis deal, still unresolved, has added skepticism to Ottawa’s latest $40 million support package for Nokia and to Joly’s approach to corporate subsidies overall.
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Once most/many/a plurality of jobs are government workers or contractors or private but paid by taxes, where does the money for payroll come from? Magic money trees?
Um… government workers still pay taxes too, you know. And they pay for groceries which pay the employees of the grocery store who also pay taxes. The system is circular.
And also, not a single elected MP, of any party, has suggested as a goal that “most/many/a plurality of jobs [should be] government workers or contractors or private but paid by taxes” so your premise is a straw man/rhetorical fallacy. Wanna try again with a realistic scenario or are you just interested in perpetuating fallacious premises?
Umm, that’s great that they pay taxes. Think they pay more taxes than they get paid? Math. It’s not for everyone. Magic money trees for everyone.
And while my hyperbole may have gone over some heads (perhaps a government employee), it’s not like we aren’t on a clear trajectory.
• 30% of all of all jobs added over the last decade were public service.
• Over 20% of all workers in Canada are now public service, 30% in Atlantic Canada.
• Public sector growth has been running at almost twice the rate of private in the last decade.
• Roughy 30% of these new hires have been admin positions. So, about 10% of all new Canadian jobs were just the new admin roles in government.
• Trudeau/Carney “investments” in industry have mainly been subsidizing private hiring, i.e. publicly funded jobs.
Can you think of a single other industry that employs more people in Canada than the public service? A plurality, perhaps.
Yeah so what? Go cry a river while you’re at it. You think services grow on trees? People who receive OAS go outside and grab it from a tree? Lol
A well reasoned, thoughtful and intelligent response.
Short bus crowd has arrived.
But your response is not well reasoned, thoughtful or intelligent so what’s the point?
You threw stats you found on the internet and complained about Public servant. I’ll retort some more and you’ll retort back with other stats you found. Ok and? You’re still sitting where you are and nothing will change. Same thing can be said about me.
So wtf are you crying about then?
You seem very confused. Kind of angry. Not too bright.
Federal employee?
Nope. What’s with the public servant hard on? You jealous and not too bright to get hired? Lol.
Once again, in English?
To answer the question you’re struggling to ask, the conversation you dropped into was about public employees. That seems to have triggered you.
Hahaha knew it! Can’t get hired. Well this was great! Later troll 😉
A very bright bulb.
Night, Joe. Hope you don’t miss your bus.
It's Me has a valid point. If you want the smartest brains in Canada to stay in Canada then you need to lower taxes, not raise them to help subsidize companies based in other countries. For example, Oregon has no sales tax to try and compete with it’s warmer climate southern neighbour, California. Canada has even worse winters and much higher taxes to boot. Why do you think many of our brightest brains move down south chasing the American Dream? Why should the smartest people stay here to help subsidize unwanted 4’th and 5’th wives from Middle East and others like Chinese seniors who move here for the health care? If I was a bright young professional just starting out, I would move down south for the money and less taxes. If you focus on lowering taxes and providing more incentive for smartest of our youth, then Multinational companies may then WANT to come to here to chase the Canadian Dream rather than go south.
It's Me has a valid point. If you want the smartest brains in Canada to stay in Canada then you need to lower taxes, not raise them to help subsidize companies based in other countries. For example, Oregon has no sales tax to try and compete with it’s warmer climate southern neighbour, California. Canada has even worse winters and much higher taxes to boot. Why do you think many of our brightest brains move down south chasing the American Dream? Why should the smartest people stay here to help subsidize unwanted 4’th and 5’th wives from Middle East and others like C hinese seniors who move here for the health care? (Actually, they just stay here for the 6 warm months of the year and go back to C hina or wherever they are from for the 6 colder months while keeping their Canadian health card). If I was a bright young professional just starting out, I would move down south for the money and less taxes. If you focus on lowering taxes and providing more incentive for smartest of our youth to stay and chase the Canadian Dream, then Multinational companies may then WANT to come.
Indeed.
Immigrants used to come here to build a better life and contribute to Canada. Now many come for the free ride or as a temporary gateway to moving to the US. Others come and then want to change Canada into the places they fled.
20% of the total will leave within 25 years. The best and the brightest trend towards leaving within 5 years. Lack of job and career opportunities and a stagnant economy is the most cited reason, followed by high taxes.
And instead of making Canada a more attractive location for business and investment, we’ve spent a decade driving private investment out of Canada and are stuck with a government that thinks it can fill that roll (hint: gov can never fill that role) by spending more money we don’t have, resulting in even higher taxes and fewer businesses choosing to invest here. Why put money into Canada if the gov will either fund it or will fund your competitors? This is why Canadian investment money is fleeing to the US.
You’re lost. What I replied to was about public servants. You need to reply to the other comments.
Not sure why you don't see the connection? Public sector should not be growing at twice the rate as private sector. It means taxes are too high. This is why we lose our best youth to the US and our system gets abused by the rest of the world and our waiting times in ER are through the roof, some surgery times impossible. They are all interconnected.
So what if there’s a connection lol
The comment I replied is talking about public sector growth, not people leaving because taxes are too high.
Stick with the subject, don’t move the goal post.
Your delusional and having a conversation with yourself.
You have to be a bot 😂
You’re pushing a single narrative and ignoring the rest. Same with the other person.
So public sector growing twice as fast as private sector has nothing to do with taxes. Mmmmkay. Let's move on
Exactly so STFU about it. Move along bot. Blocking you now so we don’t repeat this bull of a conversation 😂
Wasting your breath with that one. Certainly not the brightest bulb.
While he rails against the reduction to employee cost basis that incentives like this produce for those companies, and he whines that this is unfair to Canadian-headquartered businesses, Toby, very glaringly, neglects to also acknowledge the SR&ED rebates that Canadian companies benefit from that also reduces employee cost basis. Hypocritical much?
Did you miss the entire point of his post? This has nothing to do with being hypocritical.
The point was to put that investment and money into Canadian headquartered companies, where the benefits/outputs of the reduced cost go back directly to the Canadian economy. That means Canadian companies who are more likely to hire more Canadian talent. Keeping it in Canadian headquartered companies also means companies that are more likely to re-invest the wealth within Canada. Yes, there is SRED – but from what it sounds like, these programs may be even better than SRED.
Did you miss the entire point of his post? This has nothing to do with being hypocritical.
The point was to put that investment and money into Canadian headquartered companies, where the benefits/outputs of the reduced cost go back directly to the Canadian economy. That means Canadian companies who are more likely to hire more Canadian talent. Keeping it in Canadian headquartered companies also means companies that are more likely to re-invest the wealth within Canada. Yes, there is SRED – but from what it sounds like, these programs may be even better than SRED.
Way to miss the point entirely.
SR&ED for Canadian companies? Shocking! It’s almost like his point was to encourage such actions for Canadian companies instead of funnelling tax money to build foreign wealth and IP.
Government employee, right?