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Desperate employers dangle signing bonuses to lure in workers – CBC.ca

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Security systems firm Fitch Security Integration had to lay off employees at the start of the COVID-19 pandemic last year. Now the company is facing the opposite problem: it is in desperate need of technicians to install and service security systems and willing to pay a $7000 bonus to anyone who makes the cut. 

“The signing bonus numbers just came up in desperation,” said Edward Fitchett, president of the Toronto company, which typically fills jobs through networking and rarely needs ads. 

His small business is not alone. CBC News reviewed dozens of popular job listings sites in Canada like Glassdoor, Indeed, LinkedIn, SimplyHired and Workoplis and found signing bonuses listed for jobs at big businesses like Amazon, Aspire Bakeries and Fairmont Hotels and Resorts. 

The use of signing bonuses for common jobs signals that “these are desperate times” for some companies, says Marie-Hélène Budworth, an associate professor with the School of Human Resource Management at York University.

Canada’s jobless rate stood at 7.8 per cent in June, and there are about 830,000 workers aged 25-54 without full-time work. Yet as pandemic restrictions ease, some sectors are finding it hard to get the workers they need. 

The Bank Of Canada’s Business Outlook Survey notes some companies are struggling to find specialised labour while the Royal Bank of Canada cites retirements and a slow return to immigration as among problems in the labour market. 

Limited data is available on the popularity of signing bonuses in Canada. 

The job site Indeed says ads including signing bonuses have not substantially increased this year. But recruitment firm Robert Half found 35 per cent of 800 senior managers in a variety of sectors it surveyed were offering signing bonuses to help woo workers. 

 

Marie-Hélène Budworth, an associate professor at the School of Human Resource Management at York University, says the use of signing bonuses for common jobs signals that some companies feel ‘these are desperate times.’ (James Dunne/CBC News)

From drivers to hair stylists 

Signing bonuses are typically used in tailored offers to top executives, highly-skilled workers such as engineers and tech specialists as well as some trades workers like mechanics.

But an online sampling shows signing bonuses are now being included in ads for more common jobs across the country.  

In Nova Scotia, a licensed hair stylist can collect a signing bonus to join the Chatters Hair Salon in Halifax, while a delivery driver can get $1000 to sign with the non-profit National Diabetes Trust in Dartmouth.    

In the Montreal area, a call centre sales representative can get a $1500 signing bonus, while Amazon offers a $1000 signing bonus for warehouse workers. Aveda posted a $400 signing bonus to recruit an assistant manager for a store.

In Winnipeg, there’s a $500 signing bonus for a bilingual customer service representive at the airport. In Edmonton, the same amount is on offer for health care aides, while security guards can get $250 for signing on.

In B.C., the Fairmont Chateau Whistler will pay out a $500 bonus and the same amount in relocation costs for room attendants, Aspire Bakeries is offering $1000 to new production workers in Burnaby and Molly Maid is putting up $1000 for new cleaners in Victoria.   

Tense times for two companies in Ontario 

In Caledon, Ont., just over an hour northwest of Toronto, Thomas Wilson is relieved to see pandemic restrictions easing and says his orchard and restaurant business has never been busier.    

“People can’t go away. They can’t go to great far-off destinations,” said Wilson, who owns the Spirit Tree Estate Cidery.

But he is worried. 

Thomas Wilson is the owner of the Spirit Tree Estate Cidery in Caledon, Ont. He is offering $1000 signing bonuses to attract new employees he desperately needs. (Craig Chivers/CBC News)

He has eight students on staff who will soon leave for school and he’s already short five workers, two of them in key roles.    

“If I don’t get some hiring done in the next week, I will also be the head baker and the sous chef until we fill those roles,” he said. 

To lure candidates, Wilson is advertising a $1000 signing bonus for each job.     

It’s not the first time he has used bonuses. But after three weeks without any luck in hiring staff, the pressure is mounting as his kitchen struggles to keep up and event bookings are turned down.       

Wilson says offering a bigger bonus would be hard because other costs are up as well.   

“We lost money last year. We lost money this year so far,” he said. “We can only go so far.”   

Fitchett, the security system company owner in Toronto, says he is even considering increasing the sum offered as a signing bonus. 

“It’s crazy that it should be, but it is,” he said.

He had to lay off four of his technicians early in the pandemic. Three didn’t come back and the company has been struggling for a few months to keep up with pent-up demand for services.

Now he has job postings up for three jobs, each offering $7000 signing bonuses. After 30 days, he did not have a single qualified applicant. He says the staff shortage is causing delays on jobs and may force him to turn clients away.

Vans are parked at Fitch Security Integration in Toronto. The company is looking for skilled technicians to drive the vans to job sites and start installing security systems. (James Dunne/CBC News)

 

“You can look outside our back door and see a fleet of trucks sitting there waiting for employees. Without these employees the jobs the salesmen bring in don’t get installed,” he said.

Not a universal solution

In Langley, B.C., Trevor Borland, the owner of fastener maker Pacific Bolt, is considering robotics to make up for lost business due to a lack of labourers and skilled workers to keep up with orders.  

Other businesses in his area are struggling for help too. 

“When you drive down the road coming into the industrial park we’re in, almost every building has a giant ‘Help Wanted’ sign,” he said.

Trevor Borland owns Pacific Bolt, a manufacturer of fasteners. He’s desperate to hire staff for his Langley, B.C. factory. Instead of signing bonuses, he has raised wages by as much as 15 per cent to attract new hires. (Christian Amundson/CBC News)

He doesn’t know of anyone offering a signing bonus, but Borland has offered referral bonuses of $500 to employees who bring in a new hire, and raised wages by as much as 15 per cent.   

Budworth says raises are better for workers in the long run, and that employees would benefit from trying to lower the signing bonus to increase the salary instead.

She and other experts say that as immigration gradually resumes, some of the pressure on the labour force will ease as more skilled and temporary foreign workers come into the country.   

Budworth predicts the signing bonus trend will have a limited life span.

“It might last a while, but it won’t last forever,” she said.

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Canadian banks benefit from consumer spending rebound – The Globe and Mail

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As consumers open their wallets, the surge is pushing businesses to borrow and invest to meet that demand, which has helped drive up fees and interest income collected by banks.Christopher Katsarov/The Canadian Press

Rebounding consumer spending and business investment are boosting profits for three of Canada’s largest banks as customers travel and dine out more often, and bankers expect that growth to continue – perhaps at a more moderate pace – even amid mounting fears of an economic downturn.

Royal Bank of Canada and Toronto-Dominion Bank both reported profits for the fiscal second quarter ended April 30 that beat estimates, while Canadian Imperial Bank of Commerce’s earnings fell short of expectations as its costs swelled. All three banks saw revenue and loan balances in their core Canadian retail and business banking operations post strong gains compared with a year earlier.

As consumers open their wallets, the surge is pushing businesses to borrow and invest to meet that demand, which has helped drive up fees and interest income collected by banks.

Canada’s Big Six banks report their Q2 results this week. What we know about earnings, dividends and economic slowdown concerns

But a key question confronting banks Thursday was whether the trend will continue in the face of high inflation, rapidly rising interest rates and growing gloom about the prospects for an economic downturn. Investors and analysts are on edge about whether demand for loans could wane and defaults on existing loans might rise if economies swing toward a recession.

The banks say their clients are still upbeat and the fundamentals that underpin retail banking look strong enough to withstand some economic headwinds.

“It feels like there’s certainly some more caution out there,” said Hratch Panossian, CIBC’s chief financial officer, in an interview. “But at this point in time, on the ground with our clients, there’s still a relatively high level of confidence and relatively high level of activity as the economy has opened up, the services sectors are coming back.”

On Wednesday, Bank of Nova Scotia and Bank of Montreal both reported higher second-quarter profits and rising loan balances, and executives from both banks offered optimistic outlooks for the financial sector.

There are two key factors bolstering banks’ confidence: a tight labour market that has Canada’s unemployment rate at its lowest level in decades, and the financial buffer many customers built during the COVID-19 pandemic in the form of higher savings and lower debt.

As public health restrictions lifted, spending came roaring back. Credit and debit transactions by RBC customers were 30-per-cent higher in April than before the pandemic, and that momentum carried into May, said chief executive officer Dave McKay. TD’s credit card retail sales were up 22 per cent year over year, according to Mr. Tran. And at CIBC, purchase volumes on cards were up 30 per cent from a year earlier, excluding the bank’s newly acquired portfolio of Costco-branded credit cards.

“We have seen, I’m going to say, full recovery in the categories that are travel, hotel, entertainment,” said Laura Dottori-Attanasio, CIBC’s head of personal and small business banking, on a Thursday conference call.

That spending could come under pressure as inflation and rising interest rates push up prices and borrowing costs for customers. “It’s definitely going to eat into their discretionary income … and consumers then need to make choices,” said Kelvin Tran, TD’s chief financial officer, in an interview.

“But I think for the consumer, what is a very important factor is the unemployment rate,” Mr. Tran said. “If people are gainfully employed and we continue to see the [labour] market continues to be very tight, that increases confidence.”

Many customers also have more financial breathing room in the form of lower debts from personal loans, as well as higher savings. At CIBC, use rates on lines of credit are about 20-per-cent lower than in 2019, and the rate of revolving credit card balances is down between 7 and 10 per cent.

“We’re feeling really good about the health of the consumer,” Ms. Dottori-Attanasio said. “We’re seeing very prudent behaviour when it comes to how people are managing their debt and how they’re making payments on their credit cards.”

Though bankers are confident their customers are resilient, they are still struggling to predict how the economy will react to rapidly rising interest rates. Central bankers “have to hit demand really hard” to tamp down inflation, Mr. McKay said. “Do we land it with a slight recession? I think our message today is it could go either way, it’s 50-50. Having said that, … there are good shock absorbers to absorb that uncertainty.”

In the fiscal second quarter, RBC earned $4.25-billion, or $2.96 a share, compared with $4-billion, or $2.76 a share, a year earlier. On an adjusted basis, RBC said it earned $2.99 a share, beating an estimate of $2.71, according to Refinitiv.

TD reported net income of $3.8-billion, or $2.07 a share, helped by a one-time boost of $224-million stemming from a lawsuit settlement. TD’s adjusted earnings amounted to $2.02 a share, down slightly from the year prior but ahead of the consensus analysts’ prediction of $1.93 a share.

And CIBC earned $1.52-billion, or $1.62 a share, compared with $1.65-billion, or $3.55 a share, in the same quarter last year – before the bank completed a 2-for-1 share split. CIBC said it earned $1.77 a share on an adjusted basis, just below analyst estimates of $1.80 a share.

RBC raised its quarterly dividend by 8 cents a share to $1.28, and CIBC increased its dividend by 2.5 cents a share to 83 cents.

RBC and TD continued to unwind large loan loss reserves they stockpiled to guard against the possibility COVID-19 could cause losses to swell. RBC recovered $342-million in provisions for credit losses in the quarter. TD earmarked just $27-million in total new provisions, while releasing some other reserves as loans are being paid back.

Executives at both banks said their expectations for credit are more optimistic now that pandemic-related risks have receded. But each bank also plugged more pessimistic assumptions into models they use to predict future losses, acknowledging the odds of some sort of economic downturn are rising.

“Omicron didn’t have a big impact on [provisions] so that was a favourable factor in this quarter,” Mr. Tran said. “And then you added something that is less favourable, which is this uncertainty, this outlook.”

With a report from Tim Kiladze

Editor’s note: Hratch Panossian’s title has been corrected in the online version of this story.

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Twitter shareholders sue Musk, say he 'deflated' stock price – CP24 Toronto's Breaking News

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Barbara Ortutay, The Associated Press


Published Thursday, May 26, 2022 7:40PM EDT

Twitter shareholders have filed a lawsuit accusing Elon Musk of engaged in “unlawful conduct” aimed at sowing doubt about his bid to buy the social media company.

The lawsuit filed late Wednesday in the U.S. District Court for the Northern District of California claims the billionaire Tesla CEO has sought to drive down Twitter’s stock price because he wants to walk away from the deal or negotiate a substantially lower purchase price.

San Francisco-based Twitter is also named as a defendant in the lawsuit, which seeks class action status as well as compensation for damages.

A representative for Musk did not immediately respond to a message for comment on Thursday. Twitter declined to comment.

Musk last month offered to buy Twitter for $44 billion, but later said the deal can’t go forward until the company provides information about how many accounts on the platform are spam or bots.

The lawsuit notes, however, that Musk waived due diligence for his “take it or leave it” offer to buy Twitter. That means he waived his right to look at the company’s non-public finances.

In addition, the problem of bots and fake accounts on Twitter is nothing new. The company paid $809.5 million last year to settle claims it was overstating its growth rate and monthly user figures. Twitter has also disclosed its bot estimates to the Securities and Exchange Commission for years, while also cautioning that its estimate might be too low.

To fund some of the acquisition, Musk has been selling Tesla stock and shares in the electric carmaker have lost nearly a third of their value since the deal was announced on April 25.

In response to the plunging value of Tesla’s shares, the Twitter shareholders’ lawsuit claims Musk has been denigrating Twitter, violating both the non-disparagement and non-disclosure clauses of his contract with the company.

“In doing so, Musk hoped to drive down Twitter’s stock price and then use that as a pretext to attempt to re-negotiate the buyout,” according to the lawsuit.

Twitter’s shares closed Thursday at $39.54, 27% below Musk’s $54.20 offer price.

Before announcing his bid to buy Twitter, Musk disclosed in early April that he had bought a 9% stake in the company. But the lawsuit says Musk did not disclose the stake within the timeframe required by the Securities and Exchange Commission.

And the lawsuit says his eventual disclosure of the stake to the SEC was “false and misleading” because he used a form meant for “passive investors” – which Musk at the time was not, because he had been offered a position on Twitter’s board and was interested in buying the company.

Musk benefited by more than $156 million from his failure to disclose his increased stake on time, since Twitter’s stock price could have been higher had investors known Musk was increasing his holdings, the lawsuit claims.

“By delaying his disclosure of his stake in Twitter, Musk engaged in market manipulation and bought Twitter stock at an artificially low price,” the lawsuit says.

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​TD holds off on dividend hike; Beats Q2 profit estimates – BNN

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The Toronto-Dominion Bank beat profit expectations in its latest quarter despite muted performances across its major divisions. It also became the only major bank thus far this earnings season to not raise its quarterly dividend.

TD said its net income in the fiscal second quarter, which ended April 30, rose three per cent year-over-year to $3.81 billion. On an adjusted basis, its profit fell to $2.02 per share from $2.04 a year earlier. Analysts, on average, expected $1.93 in adjusted earnings per share. Overall credit quality improved sequentially, as TD set aside $27 million for loans that could go bad, compared to $72 million in the prior quarter.

Revenue and expenses in TD’s Canadian retail banking unit both rose nine per cent year-over-year, while profit inched up two per cent to $2.24 billion. Lending activity ramped up in the quarter, with the total personal loan book hitting an average of $402.7 billion, compared to $373.3 billion a year earlier, while business loans jumped 16 per cent to almost $101 billion.

A number of one-time items affected profit in TD’s U.S. retail banking unit. On an adjusted basis, net income in that business fell 10 per cent year-over-year to $769 million. TD said the downturn was caused in part by a much more moderate release of funds from loan loss provisions (US$15 million, compared to US$173 million a year earlier).

TD is awaiting final regulatory approvals to proceed with its US$13.4-billion takeover of Memphis, Tenn.-based First Horizon Corp. That transaction was announced in February; at the time, TD said the deal would make it a top-six bank in the United States thanks to the addition of First Horizon’s 412 branches and more than 1 million customers. It also said it hoped to close the deal in the first quarter of fiscal 2023, which is a period that ends Jan. 31, 2023.

Meanwhile, similar to many of its peers that reported earlier this week, TD’s wholesale banking unit (which includes capital markets activity) suffered profit erosion as net income fell six per cent year-over-year to $359 million.

“As we continue to emerge from the COVID-19 pandemic we face new economic uncertainties and growing geopolitical tensions. TD has proven its ability to adapt to changing circumstances and deliver performance and progress,” said Bharat Masrani, TD’s president and chief executive officer, in a release.

TD most recently announced a dividend hike (to $0.89 per share) in December; before that, the last hike was announced in February 2020. Shortly thereafter, Canada’s banks were told by their regulator (the Office of the Superintendent of Financial Institutions) to hold off on dividend hikes and share buybacks due to the pandemic. That guidance was lifted in November.  

Prior to OSFI’s intervention, TD regularly raised its dividend on an annual basis. However, Masrani has indicated dividend hikes aren’t on a pre-set schedule.

“It’s not a bad assumption that we like to look at this on an annual basis, and then hopefully we get into that cycle. But it doesn’t mean that we will not periodically look at it on a different cycle based on circumstance and the environment we might be in,” he said during a conference call with analysts on Dec. 2.

“Generally, our cycle has been annual and that has worked out reasonably well for us, but it will depend on the environment going forward.”

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