From Hawkesbury to Estevan documents show towns to be hit hardest by automation

By Jordan Press

THE CANADIAN PRESS

HAWKESBURY, Ont. _ Sitting around a table with fellow Steelworkers, Steve Berniquez starts listing companies that once stood in and around Hawkesbury, a small Ontario town an hour’s drive east of Ottawa.

When he mentions Canadian International Pulp and Paper, everybody nods. Its mill closed in 1982 and that was a bad one, more than 400 jobs gone at once.

“We had how many mills around here where everybody could work? Now we don’t have anything else,” Berniquez says, leaning back in his chair.  “They’re not coming back to us.”

If federal calculations are accurate, automation and technological advances could make the local situation worse in the coming years, with Hawkesbury, a town of about 10,000, hit harder than any other city in Ontario.

An internal government presentation from last August listed Hawkesbury as having the largest share of workers at high risk of being affected by automation. The chart in the lengthy presentation to a group of deputy ministers went province by province with the municipalities that were facing the same fate: Bay Roberts, N.L.; Summerside, P.E.I.; New Glasgow, N.S.; Winkler, Man.; Estevan, Sask.; Quesnel, B.C.; and Brooks, Alta.

Also on the list was Lachute, Que., across the Ottawa River from Hawkesbury.

Federal officials expect that rural areas and small towns will feel the biggest negative effects of automation, as well as regions  “dependent on high-risk sectors like manufacturing or mining,” while gains from technological advances accrue to large urban centres.

“Less-educated local workforces mean that rural areas and small towns are less likely to seize the economic opportunities presented by new technologies,” reads the August presentation, a copy of which The Canadian Press obtained under the access-to-information law. “Less-diversified local economies mean that rural areas and small towns are less likely to adapt if incumbent sectors and businesses are disrupted.”

The steelworkers who considered the past, present and future of Hawkesbury on a snowy spring day estimated about one-third of manufacturing jobs that disappeared in the town over the past 30 years could be attributed to technological changes.

Among the recent examples was an automated packing machine that replaced two workers in one plant, and a “magic eye” that does quality control instead of a handful of workers. Three years ago, 100 workers lost their jobs when a local warehouse decided to automate work.

Berniquez has seen it. He works in the next-door village of L’Orignal, in the melt shop at Ivaco Rolling Mills, which makes wire rod and steel billets semi-finished products that go on for further processing elsewhere. Earlier this month, the company announced it will lay off 50 people of the 538 who work there, most directly because of the tariffs the United States has put on Canadian steel imports.

Automation, punishing tariffs and now additional costs from the federal carbon tax in Ontario have left steel and aluminum companies in the town in a bind, the workers say.

But Berniquez isn’t ready to throw in the towel, nor would he considering moving to another town for work. He said it’s not how he was raised. “We need to protect what we’ve got,” he said.

As manufacturing declined, the town has found new sources of employment. More health-care jobs have flowed into town thanks to the local hospital, the steelworkers say, and, according to the latest census figures, the local service sector employs the largest share of workers in the town.

“These folks are making the (local) economy work,” said Richard Leblanc, the area co-ordinator for the United Steelworkers union. “We focus a lot on these big manufacturers that have gone, but some of that has been replaced.”

How quickly towns like Hawkesbury have to adapt is unclear. The government presentation notes that Canadian firms traditionally have low takeup rates of new technology. There is also uncertainty around how quickly new technology will come available and the breadth of its impact on any number of professions, including doctors and accountants.

A report this month from the Brookfield Institute suggested there are few easy answers for workers who want to know what training courses they should take to prepare. The report, produced to help a federal organization studying future skills needs, said a key problem is that the country lacks a “holistic, detailed, and actionable forecast of in-demand skills.”

“A complex array of changes could impact employment over the next 10 to 15 years. Some, such as population aging, are well understood, while others, such as technological change, present a high degree of uncertainty,” the report said. “When these changes interact, uncertainty expands, making it challenging to predict the future of Canada’s labour market, and more specifically, what skills will be most in-demand.”

The federal Liberals’ latest budget promised $1.7 billion in spending to provide a training tax credit and employment insurance benefits to cover wages during time away from work. The steelworkers questioned how low-income workers will be able to afford the upfront costs of programs and worried about time off from companies where training time is at a minimum because staff are stretched thin.

The spending in the 2019 budget comes after billions more, over three previous federal budgets, aimed at helping workers prepare for the tectonic digital shifts in the labour market, and help those in the workforce stay there later into life.

Hawkesbury’s future is more clouded because so many younger workers have gone off to college and university and moved away. In fact, nearby Ottawa and Gatineau, Que., have the lowest shares of at-risk workers in their respective provinces, based on the Finance Department calculations.

David Bruneault stayed in Hawkesbury as friends got higher educations, eventually landing jobs as teachers or physiotherapists down the highway in the capital. The 34-year-old went into manufacturing, but says he’s willing to take a retraining course to learn to do something else.

“You don’t want to be left with nothing,” Bruneault said. “I’m thinking about it a lot more now, too, because everything is uncertain.”

And how does being a “medicinal” or “recreational” user affect your premiums?

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Federal call centres dropped more than 3 million calls last year

Employment Insurance call centres routinely fail to meet standards on timely responses to callers

The excerpted article was written by Dean Beeby · CBC News

Service Canada’s call centre agents answer only about half the telephone calls made by people with questions about Employment Insurance (EI), a CBC News investigation shows.

The rest of the calls are lost because the system is overloaded, or because callers hang up after being put on hold.

That lacklustre performance — during the relatively slow post-2016 period, when EI claims were falling sharply across Canada — is weaker even than the results Service Canada says it has achieved.

And it comes despite the Liberal government spending up to $200 million since 2016 to hire more agents and update the technology.

“When senior management … finds itself facing call volumes it is unable or unwilling to staff and provision for, they typically move to a strategy of customer call avoidance,” said David Filwood, a call centre expert and critic of government-run operations.

The strategy “includes far longer hold times than a consumer would ever experience from a private call centre … with mazes of monotonous computerized voices … that leave callers floundering in voice mail jail, unable to reach a live human.”

Service Canada operates 10 so-called EI Specialized Call Centres from St. John’s, NL, to Vancouver, staffed by about 1,425 people. The 2018-19 budget for the centres was $83.8 million; most of that money goes to salaries.

The system has been underfunded for years, according to the consulting firm PwC Canada, which produced a report on the system in 2016.

Moving the goalposts

Service Canada initially set a service standard requiring agents to answer 80 per cent of calls (those calls that actually got through to the queuing system, at any rate) within three minutes.

On April 1, 2014, the agency moved the goalposts, stretching the three-minute window to 10 minutes and acknowledging that the earlier standard was unrealistic.

Service Canada currently can’t meet even that relaxed standard; only 67 per cent of calls got through to an agent within 10 minutes in 2018-19, down from 73 per cent the year before.

Since 2016, Service Canada has added 384 agents to its EI Specialized Call Centre workforce; it says it has increased the capacity of the network by 40 per cent.

But the investments still have not solved the problem of so-called “blocked calls” — calls made to agents that were lost because the overloaded system couldn’t even put them into a queue.

There were 3.1 million of these lost “blocked calls” in 2018-19 — along with another 979,761 calls that did get into a queue but were lost because their callers hung up before they could speak to an agent.

About 4.6 million calls did get through to an agent in 2018-19 — about half of all attempts to speak to a live human at the call centres that year.

In a 2017 report to Parliament, Canada’s auditor general cited the same “blocked call” problem at Canada Revenue Agency (CRA) call centres, where agents are required to answer calls within two minutes.

“We found that the Agency blocked more than half of the calls it received (about 29 million out of 53.5 million) because it could not handle the volume,” said the report. “Blocked calls were those that did not reach either an agent or the automated self-service system.”

By ignoring “blocked calls,” the CRA was able to claim rosier results for its call centres, the auditor general found. “While the [CRA] reported that it met its targets … its performance measures were incomplete and its call centres’ results were overstated.”

Service Canada was alerted to its own “call blocking” problem in a 2016 report it commissioned from consultants PwC Canada.

“… accessibility (being able to get through to a call agent) is still a factor that must be addressed, i.e., reducing call blocking,” warned the $700,000 report, obtained by CBC News under the Access to Information Act.

No response

Service Canada claims that in 2018-19, two-thirds of calls intended for its EI agents actually made it into a queue.

But the agency did not include in that calculation calls that were abandoned in the queue by callers who, in some cases, waited longer than 10 minutes to speak to an agent.

A spokesman for Employment and Social Development Canada, the parent department for Service Canada, said most of those calls are abandoned within the first 10 minutes and are therefore not counted.

An expert says the federal government needs to bring its call centres up to the standards of private sector operations, such as this Air Canada call centre in Saint John, N.B. (CBC)

Department spokesman Christopher Simard also said most EI callers use an Interactive Voice Response (IVR) system — the first stop for all callers, including those wanting to speak to an agent — to get answers without needing to talk to a human.

Simard added that the Service Canada call centres for EI, the Canada Pension Plan (CPP) and Old Age Security (OAS) inquiries are being upgraded with new technology that will improve performance by March of next year.

Filwood, principal consultant with TeleSoft Systems in Nanaimo, B.C., says Service Canada also needs to improve its workforce, since its agents typically need to be rotated out after three to five years because of burnout from dealing with rude, angry and abusive callers.

Source: CBC News

Sonnet Insurance partners with like-minded brands to simplify life for CDN’s

Sonnet Insurance has launched Sonnet Connect, a new way to protect, improve, and simplify life for Canadians. Known for simplifying the insurance experience, Sonnet has partnered with 14 different brands that share a commitment to customer experience that will impact Canadians at home, on the road, and in their wallet.

“This is one of the many ways Sonnet is enhancing our services to provide the best experience possible for Canadians,” said Mark Fujita, VP Business Development. “As Sonnet continues to evolve, we are partnering with brands who are equally committed to making things simple and understandable for Canadians.”

Sonnet Connect gives access to special offers, promotions, and trusted advice from partners in three key areas relevant to Canadians:

At home
Sonnet is there to protect your home with house, condo, tenant and landlord insurance, but these partners can do even more, from financing the perfect place to keeping it safe:

  • Hive – Smart home devices that help homeowners detect problems and protect their place
  • Homewise – The easiest way for home buyers to get the best mortgage by applying online in minutes to save time and money
  • MovingWaldo – The app that helps Canadians simplify address changes when moving
  • Parent Life Network – The online community for parents with exclusive deals and offers
  • Petsecure – Canada’s first and only licensed insurance company in Canada to focus solely on pet health insurance

On the road
Sonnet has your car insurance covered, and now offers more confidence for buying, leasing and selling vehicles through these partnerships:

  • CarCostCanada: Provides new car buyers with reports that include dealer costs, hidden rebates, and price guidance for peace of mind
  • CARFAX Canada: A leading source of vehicle history and valuation information helping Canadians buy and sell used cars with confidence
  • LeaseBusters: Canada’s #1 lease-take-over destination and marketplace that helps customers get out of their lease
  • The Car Magazine: Providing Canadian car buyers with the latest car news and objective reviews

In your wallet
As Canada’s first and only national provider of home and auto insurance online, Sonnet cares about making financial transactions easier for Canadians, just like these partners:

  • Borrowell: The first AI-powered credit coaching tool providing Canadians with free credit scores to help understand and improve their financial well-being
  • Drop: The app that rewards customers for spending with their favourite brands
  • KOHO: Offering customers an alternative to the traditional banking experience with no fees, cash back, savings goals, and roundups
  • Mylo: The app helping Canadians with automated savings and investing
  • Wealthsimple: The simple way for customers to grow their money like the world’s most sophisticated investors on autopilot

Sonnet will continue to provide updates as these and other new partnerships develop further.

About Sonnet Insurance
Launched in 2016, Sonnet Insurance Company (Sonnet) is a federally regulated insurance company. Our mission is to provide Canadians with an easy, transparent, and customized way to buy home and auto insurance online. Experience the future of insurance at Sonnet.ca, and say hello on Twitter, Instagram, Facebook, and LinkedIn.

SOURCE Sonnet Insurance Company

Ontario: Ford’s right, auto insurance is broken

Toronto Sun | Postmedia News

The good news is Premier Doug Ford promised major reforms to Ontario’s broken auto insurance system in last week’s budget.

The bad news is previous governments — including the Liberal one he defeated in June — have attempted such reforms and failed.

Ontario drivers are among the safest in Canada but pay 55% more for auto insurance than the Canadian average, according to a 2017 study — by insurance expert David Marshall — done for the previous government.

As Finance Minister Vic Fedeli said in his budget speech: “It is clear that Ontario’s auto insurance system is broken — and drivers deserve … transformative changes.

Insurers blame the problems mainly on fraud, which Marshall estimated costs them $1.3 billion annually.

But even more money — $1.4 billion, a third of all insurance premium benefits — goes to duelling lawyers and medical experts in court, instead of to treatment for accident victims.

Because of Ontario’s “no fault” auto insurance system, victims often have to sue their own insurance company for benefits.

As the Fair Association of Victims for Accident Insurance Reform (FAIR) notes, this means they have to hire their own lawyers and medical experts to counter their insurance companies’ lawyers and medical experts, eating up billions of dollars that should be spent on treatment.

Auto insurers complain plaintiffs’ lawyers drive up costs by charging outrageous contingency fees, redirecting money for treatment into lawyers’ pockets.

The root problem is our adversarial court system is ill-equipped to deal with these issues.

Ontario needs a system in which credible, independent, objective medical and insurance experts, approved by the province and accepted by both sides at the start of major claims, determine the injuries sustained, appropriate treatment, and costs.

We agree with the Ford government’s decision to restore the maximum benefit for those catastrophically injured in car crashes to $2 million, and it’s intent to increase competition and consumer choice in the auto industry.

That is, with the caveat that allowing insurers to offer customers cheaper insurance packages providing them with less, and often inadequate coverage, while making them pay more if they want to keep their current coverage, is not genuine reform.

Ford’s government seems to be aware of the major problems. Fixing them won’t be easy, but it needs to be done.

Swap These Financial Stocks to Reduce Risk

Victoria Hetherington

Rising household debt, falling house prices, slowing credit applications – it’s a wonder anyone is still buying shares in Canada’s Big Six banks. Indeed, from financing weed suppliers to exposing itself to a potentially volatile American market, big Bay Street bankers may be too rich by half for the low-risk appetites of domestic investors looking to them for stability.

Take Bank of Nova Scotia (TSX:BNS)(NYSE:BNS), with its exposure to the U.S. economy, for instance. Scotiabank does substantial business south of the border, and as such may have left itself vulnerable to the potential of a widespread market downturn in the U.S. Even with this leg up, though, it still managed to underperform the Canadian banking industry as well as the TSX index for the past year.

More shares have been bought than sold by Bank of Nova Scotia insiders in the past three months, though not in vastly significant volumes. The usual boxes are ticked by its value, indicating P/E of 10.6 times earnings and P/B of 1.4 times book, while a stable dividend yield of 4.88% is augmented by a good-for-a-bank-stock 6.6% expected annual growth in earnings.

Again, overexposure to the United States market is an issue with Bank of Montreal(TSX:BMO)(NYSE:BMO). Specifically, this comes from BMO Harris Bank, a large personal and commercial bank; BMO Private Bank, which offers wealth management across the U.S.; plus BMO Capital Markets, an investment and corporate banking arm of the parent banker.

With year-on-year returns of 8.1%, BMO outperformed the industry and the market, and as such seems a safe bet on the face of it. Its one-year past earnings growth of 24.6% shows rapid recent improvement given its five-year average growth rate of 6.1%. Meanwhile, a P/E of 11.3 times earnings and P/B of 1.5 times book show near-market valuation, and a dividend yield of 3.9% is matched with a 3.6% expected annual growth in earnings.

Try the “insulated” alternatives

An example of domestic alternative on the TSX index would be Laurentian Bank of Canada (TSX:LB). Although its one-year past earnings dropped by 4.2%, a five-year average past earnings growth of 14.3% shows overall positivity, while a P/E of 9 times earnings and P/B of 0.8 times book illustrate Laurentian Bank of Canada’s characteristic good value. A dividend yield of 6.3% coupled with a 9.2% expected annual growth in earnings gives the Big Six a run for their money.

Alternatively, Manulife Finanical (TSX:MFC)(NYSE:MFC) offers a way to stick with financials but ditch the banks. This ever-popular insurance stock was up 2.33% in the last five days at the time of writing and is very attractive in term of value at the moment, with a P/E of 10.3 times earnings and P/B of 1.1 times book.

Manulife Financial’s 3.5% year-on-year returns managed to beat the Canadian insurance industry, but just missed out on walloping the TSX index’s 4.2%. In terms of the company’s track record, its one-year past earnings growth of 138.1% eclipsed the market and its industry, though its five-year average is sadly negative. Its balance sheet is solid, however, with its level of debt reduced over the past five years from 60.2% to the current 41% today.

The bottom line

Sidestepping banks may be a shrewd move at the moment, with other forms of financials offering a more insulated route to a broader space. While more regionalized banks like Laurentian Bank of Canada are one option, stocks like Manulife Financial, with its dividend yield of 4.17% and 11.3% expected annual growth in earnings offer a similar but less risky play on the TSX index’s financial sector.

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