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From the Globe:
Hollowed out fears? Relax, foreigners lead on hiring
ROMA LUCIW
Foreign takeovers in the past six years have not led to widespread firings at head offices, contrary to concerns that Corporate Canada is being "hollowed out."
In fact, between 1999 and 2005, foreign companies accounted for about two-thirds of new head office jobs and all of the gains in the number of actual head offices created in Canada, a Statistics Canada study said yesterday.
The number of people employed in Canadian head offices rose 10.7 per cent to 174,882 during the six years, Statscan said, while the number of head offices here climbed 4.2 per cent to 4,161.
Steel maker Dofasco Inc., brewer Molson Inc. and wine maker Vincor International Inc. are among the Canadian companies that have been lost to foreign control, sparking fears of widespread job losses to corporate bases abroad.
The Statscan study, however, contradicts the notion that domestic jobs have disappeared.
"On balance," the report states, "foreign takeovers have had little impact on employment in Canadian head offices."
Devon Energy Corp. bought Calgary-based Anderson Exploration Ltd. in 2001. Although Devon is based in Oklahoma City, Okla., its Canadian arm is now anchored in Calgary and run by a Canadian.
"There was some consolidation at first," Devon Canada Corp. president Chris Seasons conceded in an interview, "but we have hired from where we were then." At the time of the transaction, Devon cut 4.5 per cent of its overall work force, which has since been built back up to 1,472 employees.
A separate report released yesterday suggests Canada's role as a target for foreign takeovers could be coming to an end.
"Canada will be more of an acquirer than an acquiree in the years ahead," BMO Nesbitt Burns economists Douglas Porter and David Watt wrote in a note.
For the first time since the fur trade was Canada's dominant industry, the current account surplus and capital account deficit, coupled with investment outflows, has positioned Canada as a hunter of foreign assets.
"It's tough to get overly concerned about an impending hollowing out of Canada when Canadian corporations are busily 'hollowing out' other countries," the economists said.
The BMO report calculated that 8,000 of 1.3 million Canadian companies are controlled by foreigners, accounting for 21.9 per cent of assets.
The Statscan report said that of the 164 domestic head offices that were taken over between 1999 and 2005, 34, or roughly one-fifth, were closed, resulting in 1,709 job losses. However, that was offset by the creation of 38 new head offices with 2,346 jobs by foreign companies that did not have a head office in Canada prior to 1999.
In addition, the number of jobs in head offices that remained open under foreign control rose to 3,547 in 2005 from 3,487 in 1999.
Foreign companies accounted for all the growth in the number of head offices, from 4,061 to 4,161, and nearly two-thirds, or 10,693, of the net increase of 16,888 in employment over the period. The job gains arose because new jobs from foreign-controlled offices outnumbered those lost in head offices closed by foreign firms.
In terms of location, Toronto remains the undisputed head office king of Canada, with the number of employees jumping 19.2 per cent from 1999 to 59,163 in 2005, Statscan said.
Montreal is holding on to the No. 2 spot, but has been losing ground to both Toronto and Calgary. The number of head office workers in Montreal climbed 0.4 per cent to 36,893.
Not surprisingly, Calgary experienced the fastest head office jobs growth, rising 64.4 per cent to 19,428, while Vancouver suffered the biggest drop, falling 29.3 per cent to 11,938.
Diamond Fields International Ltd. is among the latest to vacate its West Coast offices. The Canadian diamond miner fired four workers when it moved its operations to Cape Town, South Africa, in the first quarter of this year. It now has no base or employees in Canada.
*****
Jobs in the head office
Foreign takeovers have had little impact on jobs, a new study shows, and in fact account for two-thirds of the net increase in head office employment.
Head office employment
PER CENT CHANGE IN HEAD OFFICE EMPLOYMENT, 1999 to 2005
Canada: 10.7%
Domestically-controlled: 5.8%
Foreign-controlled: 21.2%
Montreal: 0.4%
Ottawa/Gatineau: 28.4%
Toronto: 19.2%
Winnipeg: -7.0%
Calgary: 64.4%
Edmonton: 15.3%
Vancouver: -29.3%
*****
16,888
Total head office employment gains, 1999-2005
10,693
Foreign head office employment gains, 1999-2005
6,195
Domestic head office employment gains, 1999-2005
SOURCE: STATISTICS CANADA
Also, from the Star:
Toronto reinforced its position as the head office centre of Canada — with 34 per cent of head office employees, up from 31 per cent in 1999. Montreal is in second spot with 21 per cent, down from 23 per cent.
Calgary's share rose to 11 per cent from 7 per cent, while Vancouver's fell by the same amount — to 7 per cent from 11 per cent. For Vancouver that represents a 29 per cent decline in employment, while Calgary saw an astonishing 64 per cent growth.
Hollowed out fears? Relax, foreigners lead on hiring
ROMA LUCIW
Foreign takeovers in the past six years have not led to widespread firings at head offices, contrary to concerns that Corporate Canada is being "hollowed out."
In fact, between 1999 and 2005, foreign companies accounted for about two-thirds of new head office jobs and all of the gains in the number of actual head offices created in Canada, a Statistics Canada study said yesterday.
The number of people employed in Canadian head offices rose 10.7 per cent to 174,882 during the six years, Statscan said, while the number of head offices here climbed 4.2 per cent to 4,161.
Steel maker Dofasco Inc., brewer Molson Inc. and wine maker Vincor International Inc. are among the Canadian companies that have been lost to foreign control, sparking fears of widespread job losses to corporate bases abroad.
The Statscan study, however, contradicts the notion that domestic jobs have disappeared.
"On balance," the report states, "foreign takeovers have had little impact on employment in Canadian head offices."
Devon Energy Corp. bought Calgary-based Anderson Exploration Ltd. in 2001. Although Devon is based in Oklahoma City, Okla., its Canadian arm is now anchored in Calgary and run by a Canadian.
"There was some consolidation at first," Devon Canada Corp. president Chris Seasons conceded in an interview, "but we have hired from where we were then." At the time of the transaction, Devon cut 4.5 per cent of its overall work force, which has since been built back up to 1,472 employees.
A separate report released yesterday suggests Canada's role as a target for foreign takeovers could be coming to an end.
"Canada will be more of an acquirer than an acquiree in the years ahead," BMO Nesbitt Burns economists Douglas Porter and David Watt wrote in a note.
For the first time since the fur trade was Canada's dominant industry, the current account surplus and capital account deficit, coupled with investment outflows, has positioned Canada as a hunter of foreign assets.
"It's tough to get overly concerned about an impending hollowing out of Canada when Canadian corporations are busily 'hollowing out' other countries," the economists said.
The BMO report calculated that 8,000 of 1.3 million Canadian companies are controlled by foreigners, accounting for 21.9 per cent of assets.
The Statscan report said that of the 164 domestic head offices that were taken over between 1999 and 2005, 34, or roughly one-fifth, were closed, resulting in 1,709 job losses. However, that was offset by the creation of 38 new head offices with 2,346 jobs by foreign companies that did not have a head office in Canada prior to 1999.
In addition, the number of jobs in head offices that remained open under foreign control rose to 3,547 in 2005 from 3,487 in 1999.
Foreign companies accounted for all the growth in the number of head offices, from 4,061 to 4,161, and nearly two-thirds, or 10,693, of the net increase of 16,888 in employment over the period. The job gains arose because new jobs from foreign-controlled offices outnumbered those lost in head offices closed by foreign firms.
In terms of location, Toronto remains the undisputed head office king of Canada, with the number of employees jumping 19.2 per cent from 1999 to 59,163 in 2005, Statscan said.
Montreal is holding on to the No. 2 spot, but has been losing ground to both Toronto and Calgary. The number of head office workers in Montreal climbed 0.4 per cent to 36,893.
Not surprisingly, Calgary experienced the fastest head office jobs growth, rising 64.4 per cent to 19,428, while Vancouver suffered the biggest drop, falling 29.3 per cent to 11,938.
Diamond Fields International Ltd. is among the latest to vacate its West Coast offices. The Canadian diamond miner fired four workers when it moved its operations to Cape Town, South Africa, in the first quarter of this year. It now has no base or employees in Canada.
*****
Jobs in the head office
Foreign takeovers have had little impact on jobs, a new study shows, and in fact account for two-thirds of the net increase in head office employment.
Head office employment
PER CENT CHANGE IN HEAD OFFICE EMPLOYMENT, 1999 to 2005
Canada: 10.7%
Domestically-controlled: 5.8%
Foreign-controlled: 21.2%
Montreal: 0.4%
Ottawa/Gatineau: 28.4%
Toronto: 19.2%
Winnipeg: -7.0%
Calgary: 64.4%
Edmonton: 15.3%
Vancouver: -29.3%
*****
16,888
Total head office employment gains, 1999-2005
10,693
Foreign head office employment gains, 1999-2005
6,195
Domestic head office employment gains, 1999-2005
SOURCE: STATISTICS CANADA
Also, from the Star:
Toronto reinforced its position as the head office centre of Canada — with 34 per cent of head office employees, up from 31 per cent in 1999. Montreal is in second spot with 21 per cent, down from 23 per cent.
Calgary's share rose to 11 per cent from 7 per cent, while Vancouver's fell by the same amount — to 7 per cent from 11 per cent. For Vancouver that represents a 29 per cent decline in employment, while Calgary saw an astonishing 64 per cent growth.