CANADA

EV battery subsidy deals to cost $5.8B more than government projections: PBO report

ALL CAPITALI$M IS STATE CAPITALI$M

Amanda Stephenson, The Canadian Press

A new report from the Parliamentary Budget Officer says provincial and federal support for electric vehicle battery manufacturing in Canada will cost $5.8 billion more than previously announced government projections.

The report, released Friday, analyzes the costs to governments of recent deals struck with Northvolt, Volkswagen and Stellantis-LGES to locate EV battery manufacturing facilities in Canada.

So far, the governments of Canada, Ontario and Quebec have announced a combined $37.7 billion in production subsidies and construction support for the three companies.

But the budget watchdog's report said the total cost of government support between 2022 and 2033 will likely be closer to $43.6 billion, with the extra $5.8 billion representing foregone corporate income tax revenues for Ottawa and the two provinces.

This is because the Canadian subsidies are being designed to match the U.S. Advanced Manufacturing Tax Credit, which is part of that country's sweeping Inflation Reduction Act. 

In a June report, the PBO noted that a tax adjustment would need to be provided to the three battery makers to ensure after-tax equivalency with the U.S. program. 

Finance Minister Chrystia Freeland has since clarified that the production subsidies provided to Volkswagen will not be subject to taxation, and Friday's PBO report assumes the Stellantis and Northvolt subsidies won't be either.

"To increase transparency around these announcements, we are providing an estimate of the total cost of government support for EV battery manufacturing — including both announced and non-announced costs," said parliamentary budget officer Yves Giroux in a news release. 

Of the total $43.6 billion in costs, 62 per cent will be borne by the federal government and 38 per cent will fall on the governments of Ontario and Quebec, the report said.

The report also estimates a break-even timeline for governments of 11 years for the Northvolt production subsidy, 15 years for the Volkswagen subsidy and 23 years for the Stellantis subsidy. 

Volkswagen's battery plant will be built in St Thomas, Ont., and the Stellantis-LGES plant will be built in Windsor, Ont. The Northvolt facility will be built about 30 km east of Montreal.

This report by The Canadian Press was first published Nov. 17, 2023.

Parkland strikes electric vehicle station funding deal with Infrastructure Bank

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More electric vehicle charging stations are on the way as the Canada Infrastructure Bank says it has signed a second funding deal to expand fast-charging options.

The federal Crown corporation says it will provide up to $210 million in loans to help Parkland Corp. expand its charging network by upwards of 2,000 fast-charging ports at as many as 400 sites. 

It's CIB's second major funding announcement for charging stations, after it provided a $220 million loan in April to Flo Inc. to help it build more than 2,000 fast-charging ports across Canada by 2027.

The charging investments come as the federal government works towards a mandate of full electric vehicle sales by 2035 to reduce road transportation emissions, which make up about 18 per cent of Canada's total greenhouse gas emissions.

Ehren Cory, chief executive of the CIB, says the funding will speed up the rollout of fast chargers.

He says companies are already expanding charging options, but it's important that the pace increase.

“The challenge is that if we are going to drive accelerated, widespread EV adoption, we need to reduce range anxiety by getting more high speed chargers deployed faster," said Cory.

“The whole goal here is rapid deployment."

The funding comes from the CIB's charging and hydrogen refuelling infrastructure initiative that has a $500 million funding target, but Cory said he hopes to exceed that amount.

Darren Smart, senior vice-president of energy transition at Parkland, said in a statement that the company's initial investments in electric vehicle charging have been positive with strong customer interest.  

This report by The Canadian Press was first published Nov. 16, 2023.

Trudeau, Eby announce $1 billion battery plant in Maple Ridge, B.C.

The Canadian Pres

A lithium-ion battery cell production plant costing more than $1 billion will be built in Maple Ridge, B.C.

Prime Minister Justin Trudeau and Premier David Eby jointly announced that the new E-One Moli facility will bolster Canada's role as a global leader in clean technology.

A statement says the province is contributing up to $80 million, with $970 million coming from the federal government, E-One Moli and private sources. 

The plant will produce high-performance lithium-cell batteries found in numerous products, including vacuums, medical devices and power and garden tools. 

The statement has no details about when the plant will begin operations, but says it is expected to create 450 permanent jobs.

As part of the agreement, E-One Moli will be switching some of its plant operations from natural gas to electricity, in what the province says is part of its role in the clean-technology industry. 

This report by The Canadian Press was first published Nov. 14, 2023.

CANADA

Millennials had largest drop in homeownership rates over a decade: Zoocasa

Daniel Johnson , BNN Bloomberg

A report looking at homeownership trends in Canada is noting that millennials experienced the largest decrease in homeownership rates during the mid-2000s.

In a report released Monday, real estate website Zoocasa examined homeownership rates and average home prices across Canadian provinces from 2011 to 2021, based on data from Statistics Canada. 

It found the rate of homeownership has dropped overall and millennial Canadians, defined by Zoocasa as people born between 1981 and 1996, saw the largest drop.

Of those millennials, people between the ages of 25 and 29 saw their rate of homeownership drop to 36.5 per cent in 2021 from 44.1 per cent in 2011.

People aged 30 to 34 saw their homeownership rate drop 11.7 per cent over the same period, the researchers found, while those aged 35 to 39 per cent with an 8.3 per cent drop.

Younger millennials were identified by Zoocasa as having difficulty entering the real estate market. Another recent survey by Zoocasa found that 67 per cent of millennials indicated they have delayed purchasing a home due to affordability barriers.

The report found that people under the age of 40 had a homeownership rate lower than the 66.5 per cent national average. The group of people between the ages of 40 and 44 was the closest to the national average, while those aged 45 and older surpassed the national average. 

WHO SAW HOMEOWNERSHIP RATES RISE?

The highest rate of homeownership was among Canadians aged 65 to 69, the report found, at 75.6 per cent.

Canadians between the ages of 75 and 84, meanwhile, were found to be the only demographic with rising rates of homeownership between 2011 and 2021. 

LARGER MARKETS 

Zoocasa’s report found that prospective buyers were being “squeezed out of major markets.”

Quebec was found to have the lowest homeownership rate at 59 per cent, despite having comparatively more affordable home prices than other provinces, the report said. Between 20111 and 2021, the province’s home ownership rate fell only 1.3 per cent, the smallest change. 

The second lowest levels of homeownership rates were held by both B.C. and Nova Scotia at 66.8 per cent, the report said, noting that provinces saw “significant drops from 2011.” 

“In British Columbia, the homeownership rate fell by 3.2 per cent from 2011 to 2021, and one explanation for this is its rapid price acceleration,” the report said. 

The report found that in 2021, the average home price in B.C. was $910,800, rising 80 per cent from $506,100 in 2011.

Ontario was found to have had the largest increase in average national home prices “by far” between 2011 and 2021.

The report noted that the homeownership rate dropped in Ontario by 3.1 per cent between 2011 and 2021, as average incomes have not risen alongside mortgage payments. 

MORE AFFORDABLE MARKETS

Provinces with more affordable housing markets had higher rates of ownership, the report found.

Newfoundland and Labrador was found to be the province with the highest rate of homeownership and had the second-lowest average home price in 2021 at $263,900. 

The homeownership rate in Newfoundland and Labrador was 75.7 per cent in 2021, decreasing by 1.8 per cent from 77.5 per cent in 2011, the report said. During that time the average home price rose by only 9.3 per cent, which was the smallest growth rate among all provinces.

New Brunswick had the second highest rate of homeownership across provinces at 73 per cent, according to the report. The province also had the lowest average home price in 2021 at $239,900. 

The only other provinces with homeownership rates above 70 per cent in 2021 were Alberta and Saskatchewan, the report said, with both provinces coming in just over the threshold. 

 

Average Canadian rent price hits new high for sixth consecutive month: report

RENT IS INFLATION

Sammy Hudes, The Canadian Press

The average asking price for a rental unit in Canada reached $2,178 last month, a 9.9 per cent year-over-year increase and continuing a trend that has seen asking rents hit new highs for six months in a row.

That's according to the latest rental price report released by Rentals.ca and Urbanation, analyzing monthly listings from the former's network. The findings show while October's annual rate of rent growth in Canada was down from the 11.1 per cent jump in September, it still marked the second fastest annual increase of the past seven months.

On a monthly basis, average asking rents increased 1.4 per cent in October, a slight decrease from the monthly gains of 1.5 per cent in September and 1.8 per cent in August, which was attributed to seasonal factors.

The average cost of a one-bedroom unit in October was $1,906, up 14 per cent from the same month in 2022, while the average asking price for a two-bedroom was $2,255, up 11.8 per cent annually, according to the report.

Vancouver led the way again as Canada's most expensive city for renters, with the average one-bedroom unit listed at $2,872 and a two-bedroom at $3,777 — both down from September's asking prices, but up 6.7 per cent and 5.5 per cent, respectively, on an annual basis.

Toronto was the next highest ranked major city at $2,607 for a one-bedroom and $3,424 for a two-bedroom.

The report said rent inflation in Canada is being driven by price increases in Alberta, Quebec and Nova Scotia, in part because of strong population growth and large infusions of new rental supply priced at above-average market rents.

"I get asked all the time, 'How are people affording this?' The answer is they're not," said Rentals.ca spokesman Giacomo Ladas.

"Rents are getting so high to the point where people are almost out of options. They're looking desperately to find more affordable rents."

Calgary topped the list when measured by annual rent growth for apartments out of Canada's largest cities for the ninth straight month. 

Asking rents for purpose-built and condominium apartments in Calgary rose 14.7 per cent year-over-year to reach an average of $2,093, while Montreal was in the second spot with annual rent growth of 10.2 per cent, for an average of $2,046 in October, the data shows.

"We can tell that because there's so much interprovincial migration going on that people are leaving areas like Ontario and B.C. and they're searching for more affordable rents, and they're going to places like Calgary," said Ladas.

He noted a major factor driving up rent prices is the trend of fewer people looking to become homeowners, given the ongoing climate of high interest rates. One-third of Canadian households are renters, the rate for which is growing twice as fast as it is for homeowners, he added. 

"People are not moving out and going into the home ownership market because they can't with these rates," he said.

This report by The Canadian Press was first published Nov. 13, 2023.

 

More seniors choosing to age in home instead of downsizing: CMHC report

The Canadian Press

A new report from the Canada Mortgage and Housing Corporation says that although seniors tend to consider downsizing as they age, a large proportion are instead choosing to age in their home rather than put it on the market.

CMHC says the usual increase in renter rates as cohorts age has been occurring later in life and is less pronounced than it used to be.

That could be due to factors such as people living longer, households having more money than their predecessors and relying less on property sales to provide for themselves, and homeowners in urban centres having a wider range of housing to choose from.

The report says households in Toronto and Vancouver are the most likely to transition to condominiums, while in Montreal, there’s a preference for moving to rental housing.

As Canada looks to create additional housing to bring costs down, the national housing agency says solutions geared toward seniors could include increasing supply from existing units by creating secondary suites or laneway homes.

CMHC says policy makers should monitor trends in the coming decades to see whether aging in place could become more popular with seniors, or whether the recent rise in rental housing starts in various regions across the country encourage more senior households to opt for renting.

 

Gen Z to overtake boomers in U.S. Canadian  workforce by early next year: report

Jordan Fleguel, BNN Bloomberg

The number of full-time Gen Z workers in the U.S. is set to surpass baby boomers in the first few months of 2024, according to a new report from Glassdoor Economic Research.

The report, released Wednesday, examined U.S. Census Bureau data, and found that the number of full-time Gen Z and boomer workers in the American workforce is currently about even.

As older workers continue retiring en masse and more young Americans reach working age, Gen Z is set to rapidly overtake the boomer generation, which made up the largest share of the U.S. workforce from the late 1970s until around 2011, according to the report.

Baby boomers are considered to be those born between 1946 and 1964, while Gen Zers are those born from the late 1990s until around 2012.

Gen Xers, born between 1965 and 1980, took over as the dominant working generation in the U.S. in 2012 before they were overtaken by millennials, born between Gen X and Gen Z, in 2018.

Millennials have since remained the dominant working generation, and won’t be overtaken by Gen Z until the early 2040s, the report estimates.

“The coming year will still represent a pivotal moment of cultural change that U.S. companies cannot ignore as Gen Z workers – who care deeply about community connections, about having their voices heard in the workplace, about transparent and responsive leadership, and about diversity and inclusion – make up a rapidly growing share of the workforce,” the report said.

CANADIAN LABOUR DEMOGRAPHICS

Canada is experiencing a similar shift in demographics, with the number of retiring baby boomers expected to grow exponentially in the coming years.

But experts predict this will only exacerbate existing labour shortages, as there aren’t enough young workers to replace the boomers exiting the workforce.

Canada's labour force growth rate has been trending downward since 2000, but the trend has intensified in recent years. This "grey wave" has been on the horizon for a while, but experts say it's now crashing ashore.

According to Statistics Canada, between 2016 and 2021 more than 1.4 million Canadians entered the ranks of those aged 55 and older, and in 2021, one in five Canadians of working age were aged 55 to 64.

CULTURE SHIFT

As demographics continue to shift, office culture is expected to follow.

For example, employers are still struggling to find the “new normal” when it comes to remote work, as many young professionals now expect flexible work profiles, even as companies have attempted to enforce stricter in-office policies. 

A recent survey of Canadian professionals by human resources firm Robert Half found that three in four respondents said a flexible work schedule is the top perk they look for in a job.

Separate Robert Half research also suggests that younger Canadian professionals have different views on certain long-standing office taboos such as discussing your salary with colleagues.

In an August survey, the firm found that 86 per cent of Gen Zers and 59 per cent of millennials reported discussing salaries with their work colleagues, while just 40 per cent of Gen Xers and 41 per cent of baby boomers said they do the same.

With files from The Canadian Press

Young professionals more likely to discuss salary with colleagues: survey

Jordan Fleguel, BNN Bloomberg

Discussing your salary with coworkers has often been considered taboo in office culture, but new survey data suggests younger generations have different views on pay transparency.

A recent survey by human resources firm Robert Half found that 86 per cent of Gen Zers and 59 per cent of millennials reported discussing salaries with their work colleagues, while just 40 per cent of Gen Xers and 41 per cent of baby boomers said they do the same.

Overall, the survey of Canadian workers found that 52 per cent of respondents said they have discussed salaries with colleagues before.

Thirty-five per cent of respondents said they are swapping salary information with colleagues equally, while 17 per cent said they aren’t sharing their own salary information even if they know what their colleagues make.

When it comes to salary negotiation, the survey found that 37 per cent of respondents said they would trust their coworkers for advice, however 44 per cent said advice from a “credible industry source” was the most trustworthy.

Meanwhile, 40 per cent of respondents said they would trust someone in a professional network outside of their own company, while 27 per cent and 26 per cent said they would trust friends or family members, respectively.

SALARY TRANSPARENCY

This latest research underscores a growing demand for pay transparency across all industries in Canada.

British Columbia recently joined Prince Edward Island as the second province to mandate that all public job postings must include wage information or a set salary range, with the government of Ontario looking to follow suit. 

Separate survey data collected by Robert Half found that the disclosure of salary ranges in job postings is now an expectation for half of all Canadian professionals when they are job-seeking.

An additional 63 per cent of respondents in the same survey said they would take themselves out of consideration for a role if an employer declines to provide salary information upon request.

METHODOLOGY

The data referenced was collected from an online survey of 596 professionals 18 years or older across Canada between Aug. 5-15, 2023. The survey was developed by Robert Half and conducted by an external survey partner.

 

Freeland touts need for grocery competition after Loblaw, Metro post higher profits

NOT HAPPENING WE NEED A WINFALL TAX ON THEM

Rosa Saba, The Canadian Press

More competition is needed in Canada’s grocery sector as consumers grapple with higher food prices, said Finance Minister Chrystia Freeland, after two of the country's largest grocers reported higher sales and profits in the most recent quarter. 

Speaking at a press conference in Mascouche, Que., Freeland said major changes need to be made to Canadian competition law in order to help stabilize food prices. 

"We need to bring more competition into the Canadian economy, particularly in the grocery sector," she said. 

"We are prepared to use every tool in our toolbox, including tax policy, to make sure that prices stabilize." 

Freeland's comments Wednesday came on the heels of financial results from Loblaw Companies Ltd. and Metro Inc.

Loblaw reported a profit for the third quarter of $621 million, up from $556 million during the same quarter last year. Revenues for the quarter rose to $18.27 billion, up from $17.39 billion. 

Meanwhile, Metro saw profit for its fourth quarter rise to $222.2 million, up from $168.7 million a year earlier, while sales were $5.07 billion, up from $4.43 billion last year. 

As Canadians increasingly look to save on food costs, Loblaw and Metro said they’ve been converting stores to discount banners and are seeing higher sales growth in private-label brands. 

"Our Maxi and No Frills stores led the way, generating double-digit growth again this quarter," chairman Galen Weston said on a conference call with analysts. The company has plans for more new and converted discount stores next year, he said. 

The price of groceries has been one of the sharpest thorns in Canadians' sides amid a broader swell of inflation that peaked last summer. 

Inflation has since eased under the weight of interest rate increases from the Bank of Canada, but many Canadians are still grappling with an overall higher cost of living, including rent, mortgage payments and grocery bills. 

On Tuesday, Statistics Canada said nearly seven million Canadians struggled with hunger last year. The proportion of families in Canada that reported experiencing food insecurity within the previous 12 months rose 16 per cent between 2021 and 2022. 

This fall, the federal government called upon the major grocers to take steps to stabilize food prices and, last month, Industry Minister Francois-Philippe Champagne announced that Loblaw, Metro, Empire, Walmart and Costco had presented their plans, which included discounts and price freezes.

However, Conservative Leader Pierre Poilievre has questioned whether the Liberal government's pressure on grocers will amount to any real change for consumers. 

"This is more political theatre," he told reporters in September, referring to Champagne's first meeting with the CEOs of major grocery chains. 

In an interview about Loblaw's financial results, retail analyst Bruce Winder said consumer trust in the major grocers is at an "all-time low." 

The industry is also nearing the completion of a grocery code of conduct meant to provide guidelines for fair dealings between retailers and suppliers. 

While grocers have been pointing to large cost increases from major food suppliers as a key factor in rising prices, they have also been criticized over some of the fees they charge to suppliers, which say they have their own rising costs to contend with. Scrutiny of these fees in 2020 helped kickstart work on the grocery code. 

Loblaw recently criticized the code, claiming it could add inflationary pressure to grocery prices to the tune of $1 billion in its current form. Members of the steering committee tasked with overseeing the creation of the code disputed Loblaw's claim, and urged the grocer to give the voluntary code a chance. 

Both Loblaw and Walmart Canada have expressed concern about the code, noted Winder, while the other major grocers are on board. 

"It'll be interesting just to see how that plays out," he said, adding that if the code fails to get traction, there could be pressure on government to step in with regulation. 

In a report released in June, the Competition Bureau said more competition in the grocery sector is "a key part of the answer" to keeping food prices down.

"Canada needs solutions to help bring grocery prices in check," the watchdog said in its report. 

The bureau also noted its inability to compel information from the grocery sector for its report limited its access to some details. 

In September, the federal government introduced legislation that aims to strengthen the Competition Bureau, including giving it the power to compel information from companies as part of its market studies, as well as to block collaborations that are detrimental to competition and choice. 

"Changes to competition law in Canada are really significant," Freeland said on Wednesday. 

"The changes we are proposing are historic and they’re going to make a big difference."

With files from Brett Bundale, Hina Alam, Mia Rabson and Nojoud Al Mallees

This report by The Canadian Press was first published Nov. 15, 2023.

 

Rogers Sugar strike taking some of the sweetness out of holiday season for bakers

Amanda Stephenson, The Canadian Press

A bitter strike at the Rogers Sugar refinery in Vancouver is taking some of the sweetness out of the holiday season for bakers and candy-makers.

Across Western Canada, small businesses that depend on sugar are struggling with shortages and higher costs as labour action at one of the country's few sugar processing facilities stretches into a seventh week.

At Le Gateau Bakeshop in Vancouver, owner Tanya Muller is growing increasingly concerned. 

During the busy Christmas season, she typically goes through 150 to 200 kilograms of sugar per week making the 20 different varieties of holiday cookies her bakery specializes in.

But right now, the maximum amount of the sweet stuff her wholesale supplier can give her is two bags, or 40 kilograms, per week. 

"We've been doing things like lining up early in the morning at Costco and trying to get in first thing to see what's available there. And sometimes that works, and sometimes, you know, Costco doesn't have anything either," Muller said.

"I'm worried we won't be able to fulfil our orders, which obviously isn't ideal for the holiday season."

According to the Canadian Sugar Institute, Canada produces approximately 1.2 million tonnes of refined sugar annually — around 94 per cent of which is refined from raw cane sugar imported in bulk to three refining operations in Vancouver, Toronto and Montreal.

The Toronto refinery is owned by Redpath Sugar, while the Vancouver and Montreal refineries are operated by Rogers Sugar Inc., which markets its products under the brand names Rogers and Lantic. 

The sugar supply issues being experienced in Western Canada stem from the Vancouver refinery, where 138 striking workers have been off the job since Sept. 28. 

Adrian Soldera, president of Public and Private Workers of Canada Local 8, said the union is at odds with Rogers Sugar over issues like wages, benefits and the company's proposal to increase refinery operations to 24 hours a day, 365 days per year.

"Right now, they do about 120 hours a week, which is Monday to Friday, 24 hours a day," Soldera said. "So they're encroaching on our weekends."

Soldera said he's aware the strike is impacting customers — even at the grocery store level, where customers are experiencing sporadic shortages just as demand from home bakers begins to spike.

"I mean, this must be the highest sugar demand time of the year," Soldera said, adding he does not know when the strike will end as the union and employer positions remain far apart.

"Even if we went back tomorrow, the sugar won't really be hitting the shelves in full capacity until the first or second week of December."

While the most severe supply problems appear to be in B.C., the strike's effects are being felt across the western provinces. 

Sarah Foy, candy-maker and owner of Volio's Confections in Calgary, said she has been buying all the sugar she can get for weeks.

"I've been stocking up ever since my father-in-law called and said, 'Do you know there's a sugar shortage?' And then another friend of mine who owns a business also called to warn me," Foy said.

"So we're trying to be prepared."

Tasha Henderson, manager at Sinfully Sweet Cathedral Bakery in Regina, said while she thinks she has enough sugar right now to make it through the holiday season, the strike at the Rogers refinery has already doubled her wholesale costs.

"We used to pay $24 to $28 a bag, and now we're paying about $50 to $62 a bag," Henderson said, adding she expects the bakery will need to increase its own prices in the new year as a result.

"For now, we're just trying to hold tight for the Christmas season, because we've already done all of our promotional documents for our holiday pricing." 

For its part, Rogers Sugar said its Vancouver refinery continues to operate, but at a reduced level, and the company is using its other facilities to support its customers in Western Canada.

In an email, Rogers Sugar chief financial officer JS Couillard acknowledged the strike has resulted in localized supply impacts in Western Canada, particularly for brown sugar and some packaged white sugar.

However, he said there is "ample supply" of the company's other products, including bulk sugars used by bigger food processors and liquid sugars.

Couillard added that the company remains fully committed to reaching a new collective bargaining agreement with its workers.

"We recognize that this has created inconvenience for some of our valued customers," he said.

"We apologize for that, and we thank all of our customers for their continued patience as we seek a resolution."

This report by The Canadian Press was first published Nov. 17, 2023.