Ontario has been hurt by a wave of plant closures, including the Kellogg breakfast cereal plant at London announced last week. Canada should not struggle to hang onto the jobs of yesterday. It should prepare for the jobs of tomorrow.
Plant closings, though painful for everyone involved, are a necessary part of industrial growth. The Kellogg company cannot go on indefinitely making corn flakes at London just to suit the plant's 550 workers and the community. It has to make its whole worldwide operation as cost-effective as possible so as to stay in the competitive game. The company's best sales growth lately has been in Asia. It has to build a new plant somewhere to do the work of its 89-year-old plant in London. Logically enough, it will close the old London plant a year hence and close its snack plant in Carmhaven, Australia by late 2014. It will expand its plant at Rayong, Thailand.
For Ontario, this news closely follows the announcement the H. J. Heinz company will close its tomato-processing plant at Leamington next June, throwing 740 people out of work and eliminating a huge customer for tomato growers in the region.
A job with a giant multinational corporation feels a bit like a job for life, but in fact, the global mega-brands are subject to technological change and shifting consumer taste as much as any mom-and-pop food processor. Ontario towns have been proud to have these world-famous corporate names among their main employers, and they are especially hurt now to lose them.
In the year when BlackBerry lost its way and laid off thousands of people in Waterloo and Caterpillar quit making locomotives at London, it feels as though a lot of great multinationals are pulling out of Canada. People who hate free trade blame it on free trade. People who hate taxes blame it on taxes. People who hate unions blame it on unions. People who want to know what's going on, however, need to stand back and look at the whole picture.
Merchandise and information now flow around the globe much faster and more easily than they did in the era when Ontario's industrial structure was established behind the tariff barriers of Conservative prime minister John A. Macdonald's National Policy. In the era of cross-border shopping and online shopping, Canadian consumers will pay a small premium to shop close to home, but they will complain about it and head for Plattsburg, Buffalo or Grand Forks at the drop of a hat to load up with bargains.
Manufacturers are even more mobile than the consumers to whom they sell. The clothing and the electronic toys in Canadian stores are extremely cheap as a result, but another result is jobs that once seemed secure no longer are.
Canada offers huge advantages as a place to live, work and raise a family. The air is pretty good in most of our cities, the power supply is pretty dependable, the governments are changed by peaceful means and the courts generally follow the law. These advantages, which Canadians take for granted, are not available to most of humanity.
For all those corporate functions that don't rely on the cheapest labour -- functions such as product research, design of production systems, management information, marketing programs -- Canada is a great place to locate them. That is the kind of work Canada should seek for its people. Why would we prepare to spend a career picking tomatoes or flaking corn when we could be designing and marketing the condiments and the breakfast cereals of the rising generation?
The recent comparison of education systems by the Organization for Economic Co-operation and Development suggested Canada is doing only a mediocre job equipping its young people with basic reading and arithmetic skills. If they were just going to pick tomatoes all their lives, that would not matter, but those jobs are rapidly disappearing. Let the corn flakes plants go. Strengthen the schools.