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CP Rail strike could be ‘detrimental’ to Canada’s economy, experts warn – Global News

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With CP Rail trains ground to a halt nationwide and thousands of workers starting to march picket lines, the anticipated strike at Canada’s second-largest railroad operator has come at one of the worst times for the country’s economy, experts say.

“The hit to the Canadian economy that this can cause is so detrimental,” Richard Powers, associate professor at the University of Toronto’s Rotman School of Management, told Global News. “I don’t know what else we can face without seeing a real collapse.”

The strike, involving nearly 3,000 engineers, conductors and other train employees, took effect early Sunday morning after a lockout initiated by the Calgary-based railway.

Read more:

CP Rail strike begins after workers locked out by employer, threatening supply chains

Following the lockout, the Teamsters Canada Rail Conference said workers were also on strike, with picketing underway at various Canadian Pacific locations. This is the fifth work stoppage since 1993, according to CP Rail.






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NDP against back-to-work legislation amid CP Rail labour dispute: Singh


NDP against back-to-work legislation amid CP Rail labour dispute: Singh

There are 26 outstanding issues, including wages, benefits and pensions, currently causing turmoil between the two sides. While both parties are still at the table with federal mediators, significant negotiation is still foreseen. Powers doesn’t see the conflict ending before Friday.

“It appears that there are still a lot of issues yet to discuss and to agree upon. A strike coming at this time, it just adds to the confusion and chaos,” Powers said, noting the clash has come off the heels of the COVID-19 pandemic and Russia’s invasion of Ukraine, which have already drastically impacted the economy not only in Canada but across the world.

For Canadians, everything from agricultural and farm products to fuel and vehicles will be impacted, according to Powers.

“Movement of parts is so important and now you’ve just cut that off,” he said.






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Reactions pour in from the Prairies as possible CP Rail lockout draws closer


Reactions pour in from the Prairies as possible CP Rail lockout draws closer

According to Dennis Darby, president of the trade association Canadian Manufacturers and Exporters, a survey conducted between Feb. 8 and Feb. 28 found nine out of ten of Canadian manufacturers are facing supply chain issues.

He said Canadian manufacturers have already lost out on an estimated $10.5 billion in sales because of transportation network disruptions and they simply cannot afford another interruption.

“Adding to our concern is the fact that a labour disruption at CP Rail will deal another blow to Canada’s reputation as a good place to do business and as a reliable supply chain partner,” Darby said.

The grain industry, specifically, is anticipated to feel the impact of the strike.

“We have those waiting for the crop off the west coast, feed-lot operators waiting for product, processing facilities across the prairies and in eastern Canada in need of canola and cereal grains in order to provide bread for the store shelves. And, we’re seeing inflation increases,” Western Grain Elevator Association spokesperson Wade Sobkowich said last week.

“Everything is coming at us all at once. There are some things we can control and some things we can’t. We should be able to control a work stoppage and yet here we are facing one. This is the last thing we need right now in the grain sector and as an economy here in Canada.”

Sobkowich said roughly half of annual grain crops are exported on CP rail lines. He said average crop size ranges between 30 and 40 million metric tons.

The beef industry could also be affected as CP Rail imports corn for feeding cattle in the nation, Opher Baron, professor and academic director at the University of Toronto’s Rotman School of Business, told Global News.

“They are basically feeding the beef industry in Canada,” he said, noting much of the country’s ground transportation is done on the rails.

Canadians could pay more when buying food, clothes, and more depending how long the strike lasts, according to Baron.

Read more:

Grain shippers sound alarm amid concern over potential CP rail strike

“This strike is not a small pool. It’s potentially a big one. It can have quite a large effect,” he said.

Even in the United States, the CP rail conflict has interrupted fertilizer and other shipments to and from the country.

Canadian Pacific covers much of the U.S. Midwest and is a large shipper of potash and fertilizer for agriculture. It also carries grain from the U.S. to its northern neighbour for domestic use and exports. The railroad serves the Dakotas, Minnesota, Iowa, Illinois, Wisconsin, Missouri and other states, according to a map on its investor website.

Canadian Pacific also operates in New England and upstate New York, spokesman for CP Patrick Waldron said.

CP got 29 per cent of its 2020 freight revenue from cross-border shipments between the U.S. and Canada, its investor website states.


Locked-out workers picket the Canadian Pacific Railway headquarters in Calgary, Alta., Sunday, March 20, 2022.


THE CANADIAN PRESS/Jeff McIntosh

According to Powers, the federal government needs to be “looking at back to work legislation” to kick start the Canadian economy. However, he added that this type of measure is rarely used in Canada as it is an affront to the collective bargaining process.

“We have to respect the process. Let’s give them a chance. But at the same time, they have to recognize that at some point things have to change,” he said.

— With files from Global News’ Sean Boynton, Connor O’Donovan and The Canadian Press

© 2022 Global News, a division of Corus Entertainment Inc.

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Netflix’s subscriber growth slows as gains from password-sharing crackdown subside

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Netflix on Thursday reported that its subscriber growth slowed dramatically during the summer, a sign the huge gains from the video-streaming service’s crackdown on freeloading viewers is tapering off.

The 5.1 million subscribers that Netflix added during the July-September period represented a 42% decline from the total gained during the same time last year. Even so, the company’s revenue and profit rose at a faster pace than analysts had projected, according to FactSet Research.

Netflix ended September with 282.7 million worldwide subscribers — far more than any other streaming service.

The Los Gatos, California, company earned $2.36 billion, or $5.40 per share, a 41% increase from the same time last year. Revenue climbed 15% from a year ago to $9.82 billion. Netflix management predicted the company’s revenue will rise at the same 15% year-over-year pace during the October-December period, slightly than better than analysts have been expecting.

The strong financial performance in the past quarter coupled with the upbeat forecast eclipsed any worries about slowing subscriber growth. Netflix’s stock price surged nearly 4% in extended trading after the numbers came out, building upon a more than 40% increase in the company’s shares so far this year.

The past quarter’s subscriber gains were the lowest posted in any three-month period since the beginning of last year. That drop-off indicates Netflix is shifting to a new phase after reaping the benefits from a ban on the once-rampant practice of sharing account passwords that enabled an estimated 100 million people watch its popular service without paying for it.

The crackdown, triggered by a rare loss of subscribers coming out of the pandemic in 2022, helped Netflix add 57 million subscribers from June 2022 through this June — an average of more than 7 million per quarter, while many of its industry rivals have been struggling as households curbed their discretionary spending.

Netflix’s gains also were propelled by a low-priced version of its service that included commercials for the first time in its history. The company still is only getting a small fraction of its revenue from the 2-year-old advertising push, but Netflix is intensifying its focus on that segment of its business to help boost its profits.

In a letter to shareholder, Netflix reiterated previous cautionary notes about its expansion into advertising, though the low-priced option including commercials has become its fastest growing segment.

“We have much more work to do improving our offering for advertisers, which will be a priority over the next few years,” Netflix management wrote in the letter.

As part of its evolution, Netflix has been increasingly supplementing its lineup of scripted TV series and movies with live programming, such as a Labor Day spectacle featuring renowned glutton Joey Chestnut setting a world record for gorging on hot dogs in a showdown with his longtime nemesis Takeru Kobayashi.

Netflix will be trying to attract more viewer during the current quarter with a Nov. 15 fight pitting former heavyweight champion Mike Tyson against Jake Paul, a YouTube sensation turned boxer, and two National Football League games on Christmas Day.

The Canadian Press. All rights reserved.

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