The federal agency in charge of ensuring there’s healthy competition between companies in Canada says there’s less of it than there used to be.
That’s the main takeaway from a new report by Canada’s Competition Bureau, published Thursday, which tracked competition in various parts of Canada’s economy and how it changed between the years 2000 and 2020.
By looking at granular data on profits, business creation and other metrics from Statistics Canada and various other government departments, the report found that overall Canada’s “competitive intensity” — the level to which firms compete with each other to win consumer dollars — has fallen over the years.
That means that instead of getting more competition, industries that were highly concentrated in 2000 were even more concentrated, in fewer hands, by 2020, the report found. And the number of industries deemed to be highly concentrated went up, too.
Rich getting richer
The biggest companies are being even less challenged by smaller new entrants than they used to be, and even the number of new entrants into industries overall has declined.
The rich are getting richer, too, as the report found that profits and markups have both risen over the past 20 years — especially at companies that were already highly profitable in the first place.
“The result of this decline in competitive intensity is that both consumers and businesses have seen fewer of the benefits that a more competitive economy has to offer, such as lower prices, greater choice and more innovation,” the bureau said in a statement.
Calls for more competition to combat soaring grocery prices
Featured VideoA new report says there’s a lack of competition in the grocery business — and consumers are paying the price. Right now, there are just five big players dominating the market in Canada.
While the report was short on concrete details as to how to fix the problem and reverse the trend, in broad terms the bureau said that what’s needed most is a “whole-of-government approach” to foster competition. And an overhaul of competition laws that would allow the bureau to do more to help.
Among the legislative changes the bureau has asked for previously is the ability to compel companies to provide inside information when requested. Currently the system is mostly voluntary.
The bureau has also asked that Canada’s Competition Act be overhauled in a way that would focus more on what’s good for consumers, as opposed to having loopholes that allow the vast majority of merger proposals to be approved.
“Merger review for the bureau is the first line of defence against concentration,” an official for the bureau said Thursday. “We need a strong Competition Act that lets us gather the information we need go after and the conduct we want to go after and really get remedies.”
Keldon Bester, the executive director of the Canadian Anti-Monopoly Project says the report “paints a picture that will be familiar to Canadians.”
While the report didn’t single out any particular industries as being any worse or better, overall, “the top firms stay the top firms for a greater duration. There’s less jostling and fewer new entrants to challenge them,” Bester said in an interview Thursday.
“That leads to stagnation and a loss of dynamism.”
New outlook needed
Bester says one interesting takeaway was that the report examined to what extent larger companies really are more efficient and found little evidence that was the case.
“That raises questions as to whether we should let companies acquire each other because of these efficiency benefits that we might not be seeing,” he said.
Ultimately, Bester says, an overhaul of Canada’s Competition Act is definitely justified, but he warns that isn’t a panacea that will magically make everything better and cheaper for consumers.
“How do we get more Canadians to start businesses?” he said. “How do we get businesses to scale up to go against new competitors? How do we change our mindset as Canadians that says as long as things are stable, they’re fine — because in reality, they might be in slow decline.”
VANCOUVER – Contract negotiations resume today in Vancouver in a labour dispute that has paralyzed container cargo shipping at British Columbia’s ports since Monday.
The BC Maritime Employers Association and International Longshore and Warehouse Union Local 514 are scheduled to meet for the next three days in mediated talks to try to break a deadlock in negotiations.
The union, which represents more than 700 longshore supervisors at ports, including Vancouver, Prince Rupert and Nanaimo, has been without a contract since March last year.
The latest talks come after employers locked out workers in response to what it said was “strike activity” by union members.
The start of the lockout was then followed by several days of no engagement between the two parties, prompting federal Labour Minister Steven MacKinnon to speak with leaders on both sides, asking them to restart talks.
MacKinnon had said that the talks were “progressing at an insufficient pace, indicating a concerning absence of urgency from the parties involved” — a sentiment echoed by several business groups across Canada.
In a joint letter, more than 100 organizations, including the Canadian Chamber of Commerce, Business Council of Canada and associations representing industries from automotive and fertilizer to retail and mining, urged the government to do whatever it takes to end the work stoppage.
“While we acknowledge efforts to continue with mediation, parties have not been able to come to a negotiated agreement,” the letter says. “So, the federal government must take decisive action, using every tool at its disposal to resolve this dispute and limit the damage caused by this disruption.
“We simply cannot afford to once again put Canadian businesses at risk, which in turn puts Canadian livelihoods at risk.”
In the meantime, the union says it has filed a complaint to the Canada Industrial Relations Board against the employers, alleging the association threatened to pull existing conditions out of the last contract in direct contact with its members.
“The BCMEA is trying to undermine the union by attempting to turn members against its democratically elected leadership and bargaining committee — despite the fact that the BCMEA knows full well we received a 96 per cent mandate to take job action if needed,” union president Frank Morena said in a statement.
The employers have responded by calling the complaint “another meritless claim,” adding the final offer to the union that includes a 19.2 per cent wage increase over a four-year term remains on the table.
“The final offer has been on the table for over a week and represents a fair and balanced proposal for employees, and if accepted would end this dispute,” the employers’ statement says. “The offer does not require any concessions from the union.”
The union says the offer does not address the key issue of staffing requirement at the terminals as the port introduces more automation to cargo loading and unloading, which could potentially require fewer workers to operate than older systems.
The Port of Vancouver is the largest in Canada and has seen a number of labour disruptions, including two instances involving the rail and grain storage sectors earlier this year.
A 13-day strike by another group of workers at the port last year resulted in the disruption of a significant amount of shipping and trade.
This report by The Canadian Press was first published Nov. 9, 2024.
The Royal Canadian Legion says a new partnership with e-commerce giant Amazon is helping boost its veterans’ fund, and will hopefully expand its donor base in the digital world.
Since the Oct. 25 launch of its Amazon.ca storefront, the legion says it has received nearly 10,000 orders for poppies.
Online shoppers can order lapel poppies on Amazon in exchange for donations or buy items such as “We Remember” lawn signs, Remembrance Day pins and other accessories, with all proceeds going to the legion’s Poppy Trust Fund for Canadian veterans and their families.
Nujma Bond, the legion’s national spokesperson, said the organization sees this move as keeping up with modern purchasing habits.
“As the world around us evolves we have been looking at different ways to distribute poppies and to make it easier for people to access them,” she said in an interview.
“This is definitely a way to reach a wider number of Canadians of all ages. And certainly younger Canadians are much more active on the web, on social media in general, so we’re also engaging in that way.”
Al Plume, a member of a legion branch in Trenton, Ont., said the online store can also help with outreach to veterans who are far from home.
“For veterans that are overseas and are away, (or) can’t get to a store they can order them online, it’s Amazon.” Plume said.
Plume spent 35 years in the military with the Royal Engineers, and retired eight years ago. He said making sure veterans are looked after is his passion.
“I’ve seen the struggles that our veterans have had with Veterans Affairs … and that’s why I got involved, with making sure that the people get to them and help the veterans with their paperwork.”
But the message about the Amazon storefront didn’t appear to reach all of the legion’s locations, with volunteers at Branch 179 on Vancouver’s Commercial Drive saying they hadn’t heard about the online push.
Holly Paddon, the branch’s poppy campaign co-ordinator and bartender, said the Amazon partnership never came up in meetings with other legion volunteers and officials.
“I work at the legion, I work with the Vancouver poppy office and I go to the meetings for the Vancouver poppy campaign — which includes all the legions in Vancouver — and not once has this been mentioned,” she said.
Paddon said the initiative is a great idea, but she would like to have known more about it.
The legion also sells a larger collection of items at poppystore.ca.
This report by The Canadian Press was first published Nov. 9, 2024.
