Portage fears ‘devastating impact’ of job cuts

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This article was published 06/04/2022 (1299 days ago), so information in it may no longer be current.

An economic impact study of provincial government cuts and closures in Portage la Prairie shows 456 public sector jobs that pay $27.6 million in wages and salaries will be affected.

The study looks at cuts to the Addictions Foundation of Manitoba’s Compass Residential Program, the Crown Lands Property Agency’s real estate division and closures slated for this year at Red River College Polytechnic’s Stevenson campus in Southport, the Agassiz Youth Centre and the 2024 shutdown of the Manitoba Developmental Centre.

“There definitely will be a huge economic impact,” said Portage la Prairie Mayor Irvine Ferris.

“These jobs that are being moved out of Portage are full-time jobs that pay benefits, they have a pension plan — the kind of jobs where people could take a mortgage, raise 2.5 kids and contribute to the community,” he said.

An average annual salary of $64,600 is associated with the five Portage organizations, according to Economic and Tax Revenue Impact Assessment: Portage la Prairie’s Public Sector Employment Reductions. The report by Manitoba’s former chief statistician Wilf Falk was commissioned by the Manitoba Government and General Employees’ Union.

It found that 456 working families will be impacted if the Manitoba government goes ahead with its plans to cut and close public workplaces in Portage, which has a population of 13,270.

Of the 456 affected workers, 349 live and work in Portage and contribute $7.6 million in federal, provincial, and municipal taxes.

Ferris said it’s the first time the community has seen the impact of all the planned public sector cuts researched and spelled out.

“It looks very accurate and it really gives the business community an idea of what the impact is — this is something we didn’t really have before,” the mayor said.

Portage has long anticipated the 2024 closure of the Manitoba Developmental Centre and the loss of more than 400 jobs, said Ferris.

“For the last eight years, we’ve really focused on economic development, creating jobs, and we’ve seen some big successes,” he said. “We’ve seen over a billion dollars in industrial investment.” The Roquette pea protein processing plant has 120 good paying jobs, said Ferris. The expansion of the Simplot potato processing plant added 79 jobs. Nearly 200 newer jobs won’t offset the losses of the public sector cuts and closures, he said.

“So there’s a pretty devastating impact.”

Agriculture is the main industry in Portage, and the public sector jobs are what helps the local economy weather tough times in the ag sector, the mayor said.

“Every once in awhile they have bad year, they have weather events, commodity prices are low, and these other jobs really backstop our local economy because they’re stable,” said Ferris. “They’re not weather dependent. They’re very different than ag jobs. Often they provide that stability for our business people, our merchants — and their incomes don’t vary that much.”

The economic assessment includes MGEU member salaries and benefits only, and not the loss of management salaries, Falk said in an interview from Victoria, B.C. where he’s semi-retired and works as a consultant.

“What’s more important is it doesn’t include the goods and services that these organizations purchased,” said Falk. “For example, the MDC and Agassiz buy food and beverages for residents — that is not included because we had no way of getting good, accurate information.”

The report does not look at what the government would save from the public sector reductions but raises questions about their potential cost to the community. For instance, how will employees having to relocate affect housing in Portage, Falk asked.

“What’s the impact of a whole bunch of homes coming onto the market at the same time? What’s going to happen to house prices?”

Falk said the estimates can’t be considered an “economic loss to the province” because not all the income received by the 456 impacted employees would disappear. Severance payments would be received for job losses, there’d be retirements with pension benefits, job transfers to other public sector locations in the province, and employment insurance payments to those out of work.

Ferris said Portage has submitted proposals to the province for re-purposing the MDC but has not received a response or any indication from the province that help is coming in its April 12 budget to offset public sector job losses.

“We know that the jobs being lost in the Portage la Prairie area are good, family-supporting jobs that contribute to the local economy,” MGEU president Kyle Ross said in a press release Tuesday.

“These job losses hurt families, damage the local economy, and force future generations out of their community. We are calling on the provincial government to recommit to investing in the region,” Ross said.

The Progressive Conservative MLA for Portage la Prairie, Ian Wishart, said he is committed to advocating for economic development in his constituency.

“Our government is working closely with staff to develop individualized plans,” he said in a statement Wednesday. “We will be communicating with the union, staff representatives at AYC and directly with affected staff about next steps. As soon as the process is developed with the MGEU, we will be meeting with each staff individually to inform them how this closure affects them personally and an opportunity to ask questions.”

carol.sanders@freepress.mb.ca