PRIVATIZATION: ECONOMIC IMPACT TO INDUSTRY AND GOVERNMENT

Students who have invested the substantial fees required for
privatized training will expect substantially higher wages.
Additionally, there would be fewer fully trained workers to compete.
These factors, combined with increased training costs to businesses
funding staff upgrading, will create an increased financial burden
to employers.

Alternatively, it is possible that employers will simply recruit
trained staff from elsewhere resulting in a higher structural
unemployment level locally. Recruitment costs will have replaced
training costs. Initially, privatization will create a shortage

of trained workers resulting in higher wages and increased unem-
ployment. In the long run, as well, increased recruitment and

staff training cost will create a financial burden for all industries,
except of course the private training schools.

Privatization could result in revenue loss to the provincial government
from the federal sources (e.g., C.E.I.C.). The government will

reduce educational costs but will incur additional welfare costs

at the provincial level and higher unemployment costs at the federal
level. The shifting of educational subsidies to the employer results
in higher expenses to the firm and therefore a reduction in tax
revenues to the governments. This will be partly offset by the tax
revenues generated on the increased profits of private schools.