Alberta Innovates, the provincially funded research and development organization focused on research, innovation, and entrepreneurship, is set to layoff up to 125 employees due to recent changes in its annual budget following province-wide cuts.
“We are acting quickly to align strategies with the priorities of this government and a smaller budget.”
BetaKit has confirmed that following significant budget cuts, which saw Alberta Innovates lose $76 million this year, the research and development organization is currently in the process of laying off up to 125 employees. In a statement to BetaKit, Alberta Innovates specifically attributed the layoffs to its budget cut, stating, “the realities of this budget require us to innovate how we operate and structure our organization to deliver outcomes.”
Alberta’s United Conservative Party (UCP) tabled its first budget on October 24, laying out $1.3 billion overall in province-wide cuts and a 2.8 percent reduction to the provincial government’s operating budget. Alberta’s tech sector was not immune, with reductions to previously promised funding for artificial intelligence, and overall reductions to budgets for regional innovation organizations. The loss of $76 million in provincial funding brought Alberta Innovates’ budget for 2019-20 to just over $202 million. In contrast, its 2018-19 budget was $278 million and $298 million in 2016-17.
“We are acting quickly to align strategies with the priorities of this government and a smaller budget,” said Dwayne Brunner, manager of media relations for Alberta Innovates, noting that everything else is “business as usual,” with processes and programs continuing to operate as Alberta Innovate transitions through this period.
The layoffs are affecting both union and non-union workers, with about 65 non-union employees currently being laid off this week. The around 60 union member layoffs are set to take place in the first week of December.
The layoffs also affect InnoTech Alberta, the wholly owned subsidiary of Alberta Innovates that focuses on commercializing research down within the province’s tech ecosystem. The employee cuts represent a more than 18 percent reduction in Alberta Innovates and InnoTech Alberta’s staff, which sat at 670 employees according to its annual report for 2019. The organization has operations in Edmonton, Calgary, Devon, Vegreville, and Victoria, B.C.
Brunner explained that with the layoffs InnoTech Alberta will shift its business focus and technical expertise to target “greater industry investment in innovation that offers sustained future economic upside for Alberta.”
Alberta Innovates is Alberta’s largest research and innovation agency, with the mandate to support and accelerate research, innovation, and entrepreneurship in the province. It is responsible for providing various programs, funding, and insights into the province’s tech industry.
Earlier this year, Alberta Innovates was forced to pause some of its programming, in anticipation of the cuts from the Government of Alberta. The organization paused five entrepreneurship programs that offered grants to entrepreneurs in the form of vouchers, aimed at helping businesses prepare for export.
The paused programs included:
- Alberta Entrepreneurship Incubator program
- Alberta Small Business Research and Innovation Initiative
- Alberta Innovation Voucher and Micro-Voucher Programs
- Industry Associates Programs
- Product Demonstration Program
Alberta Innovates eventually reopened three of the programs, Alberta Innovation Voucher and Micro-Voucher Programs, Industry Associates Programs, and Product Demonstration Program.
Brunner told BetaKit that Alberta Innovates is currently focusing on the future direction of the organization and continuing its work “that matters to the future prosperity and growth of the province.” While noting that business continuity is paramount, and processes and programs are business as usual, he did not offer comment on what the 125 layoffs will mean for some of these programs.
“The realities of this budget will challenge us to innovate how we operate and structure our organization to achieve the outcomes expected of our mandate and commitment to Albertans,” said Brunner. “We will be looking at various scenarios to align our operations with the priorities of this government and the realities of a smaller budget.”
“We’re basically blind to what may come next and that creates a lot of doubt about local entrepreneurship.”
“Corporate functions and business lines will more tightly align resources, including grants administration and program management involving government ministries, universities, and health services, as well as industry partners and entrepreneurs,” he added.
The layoffs come amid concern and frustration among the broader Alberta tech community, because of changes made by the UCP. Alberta’s budget not only affected Alberta Innovates, but organizations like the Alberta Machine Intelligence Institute (Amii) and programs such as the Alberta Investor Tax Credit.
While attending Calgary Innovation Week recently, community leaders expressed to BetaKit that the cuts have created a lot of angst and anger, with some calling it a “very blatant turning of backs on our industry.”
James Lochrie, the co-founder of Wave and current managing partner of Thin Air Labs, a group of entrepreneurs looking to find new and innovative ways to activate economic development in Calgary, told BetaKit it’s not the cuts that are necessarily the problem, rather the uncertainty they are creating.
He expressed that, while he believes reviewing Alberta Innovates programs and making it more efficient is a good thing, the cuts and layoffs are “in line with what has been happening with the recent budget, slash quickly without understanding the consequences while creating uncertainty in the market at a time when that is the absolute worst thing to do to try and grow an economy.”
“We’re basically blind to what may come next and that creates a lot of doubt about local entrepreneurship and future investment in the province,” he added. “That is why so many entrepreneurs and investors are pausing, asking themselves hard questions about whether this is the jurisdiction to grow a business or invest in one.”
Earlier this week, the University of Alberta, which works closely with Amii, received a $1.25 million donation from the Scotiabank Artificial Intelligence Research Initiative. The funding is meant to support its Department of Computing Science in building practical tools and predictive models for fraud detection and speech to text analytics. A portion of the money is also going towards supporting the growth and development of women in STEM.
Image source Alberta Innovates