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Canada: It's Time to Take a Fresh Look

A decade ago, many U.S. site seekers thought Canada an expensive place to do business. As a result, they rarely looked north of the border when expansion plans loomed.

True, Canada was a costly place to operate, compared with many stateside locations. In fact, high operating costs helped turn the country into a favorite hunting ground for U.S. economic development organizations, which sent raiding parties to feast on Canadian firms’ discontent.

Those days, though, are practically ancient history. Robert Fine, president of the Flamborough, Ontario-based Economic Developers Association of Canada (EDAC), says Canada today is a globally competitive location with a pro-business attitude, skilled workers, technology assets and – yes – attractive operating costs.

“A new KPMG Peat Marwick report comparing business costs in Canada to the U.S. and Europe is to be released March 11,” he reveals. “Preliminary numbers show us to be extremely cost competitive. The picture sometimes is painted that we’re taxed to death with wonderful social programs, but the reality is that our taxes aren’t nearly as high as they might seem – especially with the value of our dollar compared to the U.S. dollar.”

Bottom-Line Health-Care Benefits

The Canadian dollar, in fact, has hovered around 65 to 70 cents on the U.S. greenback for the past year (see CanadaFocus for a full report on Canada). That goes a long way toward making Canadian operating costs competitive with many U.S. locations, but there’s more to Canada’s bottom-line benefits. It’s found, surprisingly enough, in the country’s government-run health-care system.

“True, our health-care system is accessible to everyone in the country,” says Fine, who also is executive director of the Economic Development Commission for Central Okanagan, British Columbia. “And it must be funded by the employer in some provinces. Most companies do pay for it, even where it’s not mandated. That’s just the standard here in Canada.”

But Canada’s system “is incredibly inexpensive compared to the U.S. system from the employer’s point of view,” Fine says. “For instance, the monthly cost for myself, my wife and two daughters is about $72 Canadian (US$50). Multiply that kind of individual savings in a 100- or 200-employee facility, and a company can realize great savings in the health-care area alone.”



More Good Reasons To Take a Look

The country’s highly educated work force is another reason site seekers should consider opportunities in Canada. “Here in our community, a high percentage of the people have postsecondary education,” Fine reports. Canada’s university system is both accessible and affordable, he adds.

Quality of life is another strength. In fact, Canada has ranked No. 1 among countries worldwide in the United Nations’ livability index for the past two years.

Given its size (it’s the second-biggest country in the world in terms of land area) and its solid business benefits, you wouldn’t think Canada has a problem getting attention. “But we do,” Fine admits, “even though we have a lot to offer here. The problem is getting on site selectors’ radar screens – just getting noticed. There are an awful lot of opportunities for American companies in Canada. Once we’ve opened their eyes to what it’s like to do business in Canada, we can certainly provide a healthy environment for business growth and development. I think we’ve become very attractive.”

Indeed, Canada’s high-tech sector is in a decided growth mode. And call centers are dialing up profitable locations across the country, with most choosing sites in bigger cities and in the maritime provinces.



EDAC Initiatives

Not surprisingly, EDAC has been working hard to capitalize on the enormous business opportunities presented by Canada’s large neighbor to the south.

“There’s been a lot of emphasis in economic development in Canada in the past few years to develop partnerships with U.S. companies, especially with regard to cross-border trade,” Fine says. “About 75 percent of Canada’s population is within 100 miles (160 km.) of the U.S. border, so we’re a natural partner. We want to embrace and take advantage of the opportunities across the border.”

Another EDAC priority is raising local economic developers’ overall skills and awareness level. “We’ve worked hard on that, making sure we’re aware of the issues businesses face,” Fine reports. “And we’ve been very responsive to trends like globalization and technology.”

EDAC is also working with two U.S.-based organizations (the American Economic Development Council and the Council of Urban Economic Development) and Canada’s Dept. of Foreign Affairs and International Trade to develop location data enabling direct comparisons between U.S. and Canadian cities. “This issue has bothered us for a long time, because we can’t compare apples with apples,” Fine explains.

Given Canada’s growing competitiveness, his interest in drawing comparisons is understandable.

— by Tim Venable