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Despite competition, tech sector CEOs say they would have welcomed Amazon

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CALGARY — Tech sector entrepreneurs whose Canadian cities were snubbed by Amazon in its search for a second corporate campus say they are disappointed, despite fears they would have seen increased competition for scarce skilled talent.

They say the American online giant’s promised contribution of $5 billion in construction and up to 50,000 high-paying jobs would have been good for their city’s economy and its technology sector in the longer term.

On Thursday, Amazon said Toronto was the only non-American city to make a list of 20 finalists.

“In the short term, it’s another company competing for limited talent, that jumps to mind,” said Mike Johnston, founder and CEO of REDSpace, a designer of media software systems and corporate e-learning programs in Halifax, one of 238 cities to bid for the centre.

But, he added, “when a world-calibre company pays attention to this region, I think the trickle-down effects are valuable. It means more students come here to study, it means more people stay here.”

Johnston said his firm has nearly 200 staff members after adding 45 new hires last year.

He said he was part of a “brain drain” that left Nova Scotia for better opportunities in the United States after high school before returning in 2000 during the dot.com tech stock meltdown.

Like Johnston, Benevity Inc. CEO Bryan de Lottinville said he was disappointed but not surprised that his home town of Calgary failed to win its bid for the Amazon HQ.

His company, which makes software for corporate charity programs, has nearly doubled employment in the past two years to 420, but he says he’s not worried that Amazon would have stolen his staff or driven up wage levels.

“You know, people don’t work for companies, they work for the employee experiences and leaders and things like that,” he said, adding that to be frightened of competition is “not how you build business, an identity and a brand.”

De Lottinville said he supports economic diversification initiatives to help Alberta’s economy evolve from a dependence on oil and gas production.

In Ottawa, CEO and co-founder Jason Flick of You.i TV, says Amazon would have been a disruptive force for employment, real estate and local cost inflation — but he still wished they had chosen his home town.

“There would be a double-edged sword for sure,” he said. “The fight for talent would go higher. The U.S. dollar is stronger to pay more. Building space would be at a premium. But I was definitely looking forward to it.”

Flick said he wasn’t worried Amazon would steal his workforce, which has grown from about 35 to 200 in three years — because “we do really cool stuff.” The company has developed a multi-screen TV and media app platform.

He said another large employer could have sparked improvements like more flights at the airport.

Studies suggest a big Amazon presence in the Toronto area might accelerate a brain drain from Canada to the U.S. as the brightest Canadians are promoted to U.S. headquarters, said University of Waterloo assistant economics professor Joel Blit.

He added it could also drive up local costs for housing and wages.

But he said the potential positive impact of Amazon as one of the anchors in a Waterloo-Toronto technology hub similar to Silicon Valley in California would still outweigh the negatives for the tech industry.

“We took a big hit with BlackBerry where it is now,” he said, referring to job cuts and downsizing at the telecommunications firm over the past several years.

“It’s nice that Google is here. If we had Amazon and maybe a couple of others, truly it could be a world-leading cluster that could be driving a lot of wealth for Canada.”

He said potential positives include a larger labour pool, enhanced regional business relationships and the opportunity for informal shared knowledge between companies.

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Canadian ministers meet with CN Rail

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Canada’s Liberal government sent two ministers on Monday to meet with representatives of Canadian National Railway and its largest union, as already hard-hit shippers pleaded for government intervention to avert a strike planned for early on Tuesday.

The threatened strike by 3,000 workers with Teamsters Canada comes after CN, the country’s largest railroad operator, said on Friday it would cut management and union jobs, as it grapples with softer economic conditions.

Labour Minister Patty Hajdu and Transportation Minister Marc Garneau were to meet with representatives from CN and the union in Montreal, Hajdu’s press secretary Veronique Simard said, following a stalemate in contract talks.

CN said it believes a strike can be averted “with the assistance of federal mediators,” after Teamsters declined to submit to binding interest arbitration.

“We expect talks to continue up to Nov. 19,” CN said.

Teamsters and CN reached a last-minute deal in 2017 that averted a planned strike. Canada, one of the world’s biggest exporters of farm products, relies on its two main railways to move canola and wheat over the vast distances from western farms to ports. Crude oil shippers in Alberta have also used trains in the past two years to reach U.S. refineries as an alternative to congested pipelines.

Urging Ottawa to intervene

Alberta wheat and barley commissions, representing farmers, urged Ottawa to intervene, as they are already facing difficult harvest conditions because of weather. “There are a lot of farmers who already have a significant amount of their income trapped under snow,” said Gary Stanford, Alberta Wheat Commission chair. “Now adding insult to injury, we’re looking at possible CN rail strike action too.”

CN was expecting slightly lower fourth-quarter crude shipments from the third quarter, officials said on an Oct. 22 conference call.

“The minute they start shutting down trains you start backing up the grain elevators and you start backing up stuff on the farm,” Ward Toma, General Manager for Alberta Canola, said. “You start backing all that stuff up that not only affects farmers — but canola crushers send oil via rail, and canola meal via rail to the United States — you lose that ability, you start backing things up.”

Toma says according to Alberta’s last agriculture report, 20 per cent of the canola crop is still out in the fields. And he says this is the time of the year farmers look to sell and pay their bills by the end of the year.

“They’re busy, they still haven’t got the crop off and they are trying to move product.”

Slumping commodity prices, congested oil pipelines and a dispute with China that has hampered Canadian agriculture exports have pressured the economies of resource-rich western provinces.

Teamsters Canada spokesman Christopher Monette said the planned strike by its conductors, train personnel and yard workers comes because workers are “hitting a wall on issues related to health and safety.”

“While we continue to negotiate in good faith and in hopes of avoiding a labour dispute, we have every intention of striking at 12:01 a.m. ET tonight unless an agreement can be reached before then,” Monette said by email.

CN shares were trading down 0.5 per cent in early afternoon Toronto trading.

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Western Forest Products workers ended strike talk without resolution

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Western Forest Products Inc. says negotiations with the United Steelworkers union representing workers in a long-running coastal B.C. strike ended without resolution on the weekend.

The company says no active negotiations are occurring and no future mediation dates have been scheduled after 14 hours of bargaining occurred on Saturday and Sunday supervised by two independent mediators.

CEO Don Demens says the mediators informed the company talks were over after it presented a contract offer.

The strike which began July 1 affects about 3,000 coastal forest workers employed in Western Forest Products’ sawmills and timberlands operations.

Demens says the company offered a five-year agreement with a $2,000 signing bonus and wage increases of two per cent per year for the first four years and 2.5 per cent in the fifth year.

He says the company also agreed to drop proposals to modernize agreements, as well as pension plan alternatives opposed by the union, but didn’t go along with Steelworker demands for a shorter-term agreement, bigger wage hikes and less shift flexibility.

United Steelworkers Local 1-1937 president Brian Butler says the union would release its position on the matter later Monday.

The company’s shares lost five cents or 3.9 per cent at $1.22 in afternoon trading on the Toronto Stock Exchange.

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Over 100 bus cancellations in Metro Vancouver

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Photo: Downtown Vancouver, British Columbia, Canada – December 31, 2018: Bus driving on Granville Street. / Shutterstock

As the transit strike continues in Metro Vancouver, many bus passengers were left waiting a bit longer than usual during their Monday morning commute.

TransLink, the area’s transit operator, lists hundreds of service alerts on dozens of routes across the Lower Mainland as Unifor bus drivers, SeaBus operators and mechanics enter Day 18 of a labour dispute with Coast Mountain Bus Company.

Currently, the transit operator has listed a whopping 427 advisory alerts under its ‘bus’ section. Of course, some of these are scheduled detours, and a few are due to traffic, but the vast majority are cancelled as a result of the transit strike.

For example, the #3 bus, which saw a few cancellations this morning, has a number of advisories listed for this afternoon and evening:

  • 3 Main-Marine Drive Station trip leaving Eastbound W Cordova St @ Seymour St at 4:55 pm
  • 3 Main-Marine Drive Station trip leaving Eastbound W Cordova St @ Seymour St at 4:55 pm
  • 3 Main-Marine Drive Station trip leaving Eastbound W Cordova St @ Seymour St at 3:03 pm
  • 3 Downtown trip leaving Marine Drive Station @ Bay 1 at 2:13 pm
  • 3 Main-Marine Drive Station trip leaving Eastbound W Cordova St @ Seymour St at 5:24 pm
  • 3 Downtown trip leaving Marine Drive Station @ Bay 1 at 4:31 pm
  • 3 Main-Marine Drive Station trip leaving Eastbound W Cordova St @ Seymour St at 3:30 pm
  • 3 Main-Marine Drive Station trip leaving Eastbound W Cordova St @ Seymour St at 3:30 pm
  • 3 Main-Marine Drive Station trip leaving Eastbound W Cordova St @ Seymour St at 1:35 pm
  • 3 Downtown trip leaving Marine Drive Station @ Bay 1 at 12:45 pm

As of 11 a.m. on Nov. 18, approximately 114 bus routes in Metro Vancouver have advisory alerts. Some hard-hit routes include the busy line along Broadway and buses to Simon Fraser University, the University of B.C., the B.C. Institute of Technology and Capilano University.

“We’re expecting 5 to 10 per cent of service to be impacted today due to union job action,” Ben Murphy, TransLink spokesperson, told Vancouver Is Awesome in an email.

“This morning 4 SeaBus sailings also had to be cancelled.  Customers should sign-up for transit alerts and check the TransLink website or Twitter account for the most up-to-date information and impacts being caused by union job action.”

Murphy underscores that the view from Coast Mountain Bus Company is still that the union needs to be more realistic about their wage demands, and that its offer is in excess of other public sector settlements in British Columbia.

“Coast Mountain Bus Company has offered wage increases of more than $6,000 for transit operators and around $10,000 for skilled tradespeople.  This would bring transit operator salaries to just under $70,000, and skilled tradespeople salaries to around $88,000.”

Unifor lead negotiator Gavin McGarrigle and other Unifor representatives held a news conference in New Westminster earlier last week.

McGarrigle mentioned how, “TransLink CEO Kevin Desmond could see his pay soar by 25% to nearly $500,000 a year, while the head of the Toronto Transit Commission earns $150,000 less each year.”

“CMBC President Michael McDaniel has been on the job for about a year and a half and could see his salary soar by 18% to about $372,000,” he said.

McGarrigle added that, “both of these transit executives make more than the Prime Minister.”

“Translink simply doesn’t treat its workers fairly. They divide their workers into separate companies and tell skilled trades not to compare their wages with each other. In the employer’s mind, a comparison to Toronto’s transit system is fine for executive wages, but it’s somehow offside for transit operators,” said Gavin McGarrigle.

With files from the Canadian Press. 

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