Blog - Cambridge Chamber of Commerce

I am a small business owner based in Cambridge, Ontario.  Along with my partners, we operate two manufacturing operations employing a total of about 25 people.

 

I am proud of all of the response of our political leaders to this crisis on all levels – local, provincial and federal.  They have taken a sober and analytical approach to the immediate needs of the citizens of this country.

 

Their willingness to commit funds, resources and support to our front line workers, small businesses and all in need will get Canada through this ordeal.

 

As a business owner, my top priority is always looking ahead to determine how I can not only succeed; but avoid unexpected disruption to my team; and minimize our potential for risk of any kind.

 

This is where I think the business community needs more support from our leaders.

 

The question of when we should re-open for business is open for debate.  The leaders in Canada, USA and abroad have differing opinions on this matter. 

 

There is only one question on my mind – what is required for me to do business in a way that will be safe for my team, clients and supply chain?  This is the question that must be answered prior to our return to regular business.

 

There is no doubt in my mind that the scientists of the world will determine when it should happen; using the tools and expertise available to them.  It brings me comfort to know that our Canadian politicians are being guided by science in their decision making process on these issues.  

 

However, there is another component to this decision that I think we are neglecting.  Whenever we return to work, it will be to a new business landscape.  There are new risks, new considerations and a higher expectation from the community for business owners to provide a safe working environment.  As a community, we need to determine what will be required to have in place prior to a return to “regular” business. Until we have a vaccine / “herd immunity”, do workers require masks to be safe?  Do we need to require hand sanitizer at entry points to work areas and require all team members to use?  In Taiwan, there are some common practise expectations for citizens that have allowed them to maintain a very low infection level of COVID without restriction on children being at school, or businesses operating normally.  What can we learn from their example that can help us to prepare to resume our work?

 

If Toyota, Honda, or even my business or a local hair salon re-opened in two or four weeks without making any adaptations to how the risk of COVID transmission is controlled; how will we have made progress against this disease?

 

The saying “time heals all wounds” has never resonated with me.  Time doesn’t heal all wounds; but time does offer us the opportunity to prepare for what is coming at  us next.  We know that the economy will have to resume prior to COVID being completely eradicated.  The question is – what will we as a community do to mitigate the risk of another peak of infection as we make that return to the new normal?

 

There is no question that children will have to return to school; I am less concerned about when that happens than I am about what the plan is to keep them safe and healthy once they are there.  We have the example of how Taiwan has made this work; kids wearing masks and having plastic cubicle style dividers between desks during meals.  Will we use this time to learn from their example and adapt our own action plan for what is required to be in place prior to resuming their in class education?  My hope is that we do. 

 

The Cambridge Chamber of Commerce is starting to gather experts and business owners to start this discussion.  I am proud to be a part of this discussion; I look forward to learning and planning together with others to determine how we as a business community can plan to get back to business.  This is new territory for everyone – consumers, business owners, employees, politicians, government, youth and seniors.  If we can agree on the supports that are needed to re-open in a safe manner, the time spent until that happens can be spent planning and making the required changes to how we do business to accommodate the new reality we live in.  If as a community we neglect this opportunity to plan and adapt, we are destined to repeat this cycle of the pandemic again in the not so distant future.

 

This is work that our Chambers of Commerce, professional associations, industry associations, regulatory bodies or governing standard registrars, perhaps the labour unions and school boards are well poised to do.  They have connections to business in their sector, a communication channel with a broad range of companies in a vertical market, and the support of their members.  If we all pressure these organizations in our own industries to get to work on our behalf, we can start planning for the future.

 

It’s time to change the question from “when can we re-open” to “what is required for a safe and healthy re-opening in my workplace to get through this crisis”?

 

Let’s get to work.

 

Kristen Danson

Managing Partner

MitoGraphics Inc. / Swift Components Corp

519 240-4205 Direct

 

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First you have the Provincial Government with Bill 148 and then you add what our Federal Government wants to do regarding taxes and in reality it just adds up to a nightmare for small businesses. Greg explains in this weeks' 'The City'.

 

 

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Big increases to minimum wage are becoming fashionable in Canada: first Alberta (from $12.20 currently to $15 in October 2018), then B.C. (from $10.35 to $11.35 in September 2017) and now Ontario (from $11.40 to $15.00 in January 2019, a 30% hike in 18 months). Are workers better off or does it mean fewer jobs?


The debate has been ferocious because economists don’t agree, but let’s look at the fundamentals. The government accepts that carbon taxes are effective at reducing emissions because if you make something more expensive, people will use less of it. We agree, but the same logic must apply to wages. And, actually, a business owner faced with the rising cost of an input (labour) has three options:

  • Absorb the added cost out of her profit margin
  • Raise prices
  • Reduce use of labour by substituting in morecapital or simply making do with less work

Let’s take these in order. Some businesses are so spectacularly profitable that owners can just absorb rising labour costs. But Apple and Microsoft don’t use minimum wage labour. If we look at profit margin by industry, the biggest users of minimum wage labour are in retail and food service, with razor thin (below 3%) margins. There is very little room to absorb these costs, and if a business is not profitable, there is not much point in keeping it going.


What about raising prices? The critical ingredient in business success is getting the right price point for your market. One restauranteur told us that the lunch menu in her neighborhood has to be $5-$8, any higher means flirting with disaster. In retail, the competition is with online giants, like Amazon. Often, there is no room to raise prices without driving away customers.


The third option to cope with rising wages is making do with less staff. This is controversial because many studies show that minimum wage can be increased without a corresponding rise in unemployment.

 

That’s why the recent Seattle study produced such a bombshell. Washington state collects detailed data on hours worked and it showed how part time workers with irregular schedules are cut back. Seattle’s minimum wage hike reduced the total hours worked by the low-wage workforce by about 9% while raising their wages by only about 3%. The net loss to workers was an average of $125 a month. This is a big, immediate hit to the most vulnerable workers.


In the long-term, minimum wage hikes can also drive labour-saving capital investment. The former CEO of McDonald’s told Forbes, “demands for a much higher minimum wage would force businesses with small profit margins to replace full-service employees with costly investments in self-service alternatives.” At the time, labour groups accused business owners of crying wolf. McDonald’s is now rolling out touchscreen selfservice kiosks across Canada and the U.S.

 

There is some evidence that modest increases in minimum wage can be done without disrupting labour markets, but governments have to be cautious about hurting competiveness. Previously, I had said there are three options to deal with rising costs, but there is actually a fourth and a fifth option: shut down or move to a different jurisdiction. Let’s provide input to the Government of Ontario to prevent this from happening. The Ontario Chamber of Commerce has
done some great work on this issue and has a report that can be viewed here.

 

For more information, please contact:

Hendrik Brakel

Senior Director, Economic, Financial & Tax Policy

613.238.4000 (284) | hbrakel@chamber.ca

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The Liberal government wants to introduce a minimum wage increase to $15 dollars an hour by 2019. This isn't a move that best helps the people of Ontario nor is it the right move. Funny enough... These newly reformed labour laws won't fully come into effect until AFTER the provincial election is over with. Is it about helping the people of this province? Or is it a move for someone to keep their Premier job?

 

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Bonnie Lysyk the Auditor General for the Province of Ontario released her report last week. The most scathing report in the history of the Province, suggesting that programs are riddled with incompetence and mismanagement.

 

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Ti's the Season, according to the Auditor General. What a wonderful Christmas present to hear about the waste, when some at this Christmas will go without even a decent meal. Just ONE of the wasteful acts by Government could have made Christmas a whole lot brighter for ALL the Homeless in the Waterloo Region, for the next 25 Christmas's. Shameful and disgusting, we don't need to change the people, the people need to change their attitude, there is simply no reason to accept incompetency from elected officials, they said they would watch our money, they even took an oath to do so, now lets hold them 100% accountable to do just that.

 

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