Going down the road has been a fact of life for Nova Scotians since the wind went out of the age of sail. Jobs, especially good-paying jobs, have been hard to find at home, so the province’s youth – along with its doctors, tradespeople and other professionals – have hoofed it to more fertile ground.
Now, with a massive new shipbuilding contract on the horizon and the need for skilled workers rising sharply, the head of the Mainland Nova Scotia Building and Construction Trades Council thinks he’s found a way to stop the outflow: pay more.
“We don’t have to match wages, but we have to close the gap,” Brad Smith recently told the Chronicle Herald. “There’s a huge opportunity here, and we have to tighten the gap if we’re going to keep the skilled labour we want here.”
Smith, whose organization represents more than 10,000 craftspeople in roughly 200 companies, bolsters his contention with a few key facts. First, 3,500 people pack up and leave Nova Scotia every year. Second, the province’s unemployment rate has hit the double-digit mark. Third, the average weekly wage in Nova Scotia’s construction industry is 24% below the national average.
The “pay them more” philosophy is a contentious one in a province built on small business and a have-not mentality. No one knows this better than Smith. He came to his new financial awareness after serving as vice president of the Greater Halifax Partnership (GHP), the city’s lead economic-development organization. The GHP’s website still holds out lower wages as a lure, although that information is not front and centre: “Salaries in Nova Scotia tend to be lower than in other provinces and American states – a real competitive advantage for companies located here.”
For years, Nova Scotia’s economic-development agencies have quietly but openly used lower wages and the lower than average unionization rate to persuade companies to set up shop here. Now, the sales message more often has new wording and companies have to read between the lines.
For example, ConnectNS, an initiative of the province’s business-development agency aimed at drawing new investment, highlights three reasons why Nova Scotia is cost-competitive: KPMG says so in its 2012 Competitive Alternatives report; employee turnover is lower here (at least, this is what “companies boast”); and there are payroll rebates that usually return 5%-10% on eligible gross payroll.
The time may be ripe for Smith’s new mantra to take hold, however. We’re told the $25-billion shipbuilding contract will have a dramatic effect on the province’s real estate market, gross domestic product and employment, both direct and indirect. The GHP estimates the contract will create the equivalent of 8,500 jobs over its tenure. And Jim Irving, CEO of Irving Shipbuilding Inc., the firm that won the federal government contract, said within minutes of being awarded the contract that tradespeople from Nova Scotia who are living out west could now come home.
Everyone knows the returning expatriates will want paycheques that at least equal what they have been earning by going down the road. It’s too early to tell if that will happen, but the elephant in the room has – at long last – been acknowledged.
© 2013 Investment Executive. All rights reserved.
Quebec to drop withdrawal limit for LIFs in 2025
Move will give clients more flexibility for retirement income and tax planning