A good article in the globe & mail about the economic climate of Nova Scotia, Halifax in particular.
Nova Scotia: Canada's safe harbour
Economic catastrophes have a habit of inverting the natural order of things. Governments take over car companies. American consumers begin to save. And unemployed Wall Street professionals look to Nova Scotia for work.
That's right, Nova Scotia: the same province that for decades has been dismissed as an economic ne'er-do-well, a place that has been steadily robbed of its fisheries, its mines, and its most promising talent.
Not any more. As the recession has taken hold, wreaking havoc in the North American job market and gutting home equity, Nova Scotia actually seems to be getting stronger. It had the best full-time job growth numbers in Canada over the past 12 months, and in Halifax, its largest city, home prices are expected to hold steady or increase this year, bucking a national drop of 7 per cent.
“What's really neat about this is that during the whole recession, Halifax has quietly carried on as if there wasn't one,” said Stephen Lund, CEO of the province's business development agency, Nova Scotia Business Inc. “We're pretty excited about what we see.”
Last Wednesday evening, Mr. Lund was in New York as the lead sponsor of the Wall Street Pink Slip Party, a kind of recruitment fair that resembles corporate speed-dating.
More than 500 financial professionals, many of them junior analysts, traders, and sales people, crowded into a Manhattan wine bar to network, sip cocktails, and swap business cards. Those looking for work wore fluorescent pink bracelets; those looking to hire, like Mr. Lund, wore green ones.
“For us, its exposure in the U.S.,” he said. “It's really creating awareness. We're positioning [Halifax] as a world financial centre.”
Plenty of cities have made that boast, but few have actually backed it up. And while it might be fanciful to think Halifax could become a world-class financial hub, it is making encouraging strides.
A few years ago, Mr. Lund and his team began cold-calling hedge fund administrators in Bermuda, preaching the gospel of doing business in Nova Scotia: a plenitude of university grads; a low cost of doing business; virtually zero turnover in the employment ranks; and of course, some generous tax breaks from the local government.
The province has since attracted several heavyweights in the hedge fund and insurance industries, including Citco Fund Services, Butterfield Fulcrum, Meridian Fund Services, and Marsh.
Nova Scotia Business Inc. (NSBI) has also recruited technology companies like Research In Motion, and a handful of the largest defence companies, like Lockheed Martin, and General Dynamics.
“We could have increased employment in various sites across Canada,” said Michael Barton, an Ottawa-based spokesman for Lockheed. “But to us Halifax is attractive – proximity to the customer is one reason, but also the availability of qualified labour.”
Lockheed plans to create up to 100 new jobs within the next five years in Halifax for positions ranging from software engineers to computer systems analysts. The move will more than double its work force in the city as the company works on a contract to help modernize Canadian Navy frigates.
“One thing you'll find with the government of Nova Scotia, they are aggressive. They come to you with a ‘how can we help' kind of attitude. They're persistent. And they have some unique tools in their bag,” like payroll rebates, Mr. Barton added.
Each new hire Lockheed makes will qualify for a rebate of up to $18,294 per person.
Mr. Lund stresses that these jobs aren't merely support staff and call centre positions, either. One of the financial firms that has established a foothold in Nova Scotia employs 20 PhDs, and pays an average annual salary of more than $100,000. And while the employment numbers may seem modest – the financial companies that have been lured to Halifax plan to employ 1,000 people within five years – that can be significant in a small province.
Indeed, Halifax and Regina had the strongest job growth of all Canadian and U.S. cities over the past year, as measured by both total and full-time employment, government statistics show. In Halifax, employment has risen 4.2 per cent in the past 12 months, and more strikingly, 3.3 per cent since the recession took hold in October.
Heavy reliance on recession-resistant sectors such as health care, universities, government, and defence helps explain why the city was not swept up by either the boom or the bust, said David Chaundy, a Halifax-based senior economist at the Atlantic Provinces Economic Council.
“The province and the city are moving in the right direction, towards knowledge-based, higher-skill, higher-wage jobs,” he said.
The slowdown in Western Canada, which attracted a sizable number of workers from Nova Scotia, is also helping. People are coming back, which has helped boost net migration to the province for the seventh straight quarter.
“This is one of the most stable markets in Canada right now,” said Charlie Aucoin, an analyst with the Canada Mortgage and Housing Corp.
And one of the most optimistic. According to a Manpower Canada survey this month, 23 per cent of employers plan to hire this summer while just 7 per cent plan to reduce their work force.
Of course, Nova Scotia's economic performance has to be taken in a relative context: Unemployment remains at 8.9 per cent, for instance, and there is little question that the job market varies widely by region. Although Halifax seems to be weathering the storm quite well, other areas of the province that were once reliant on forestry, mining and fishing continue to struggle.
Mr. Lund of NSBI is hoping to disperse that prosperity by attracting more businesses to the province, and helping the existing ones grow. At the pink slip party, dozens of people who stepped up to the NSBI table were curious to hear the province's pitch.
There was one small complaint, though. “The recruiters should sponsor the bar,” said Shanti Vargas, a young woman looking for work in the financial services sector – and who confessed to knowing little about Nova Scotia. “We're unemployed”