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APRIL 2016 • SPOTLIGHT ON BUSINESS
Get Noticed. Spotlight on Business reaches and engages with influential entrepreneurs, business groups, associations, and all levels of government, so you can be up to date on the latest industry and business news along with feature articles on companies succeeding in today’s every changing marketplace.
For more information on how to get involved, vist www.spotlightonbusinessmagazine.com or email info@spotlightonbusinessmagazine.com
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SPOTLIGHT ON BUSINESS • APRIL 2016
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APRIL 2016 • SPOTLIGHT ON BUSINESS
spotlight on april I t is very true to say that regardless where you do business or what industry you are in that there is some uncertainty about what the immediate future will bring. As the first quarter of the New Year ends, we start to see how recent political and economic events will affect reaching our goals for 2016 and beyond.
Editor Lee Atwater
Research Team Barry Cox Latasha Hetland Ryan Jacobs Alia Morash David MacDonald
Daily headlines create a rollercoaster ride of emotions about the global economic path. Much of the information is partisan and often the messages are disseminated directly by political parties or through consortia sharing similar ideological viewpoints.
Operations and Production Director Manager Samantha Ford
Office Administrator Kyte Carter
Nevertheless, if you tend to lean to the left, the right or stay straight down the middle, we can all agree that we have some challenges to overcome if we are to see the economy growing again. You have AIDACA Media’s commitment that Spotlight on Business Magazine will be there to keep you informed on the issues, economic and industry events and to celebrate those that took the jump and successfully overcame adversity in a challenging economy to take their companies from good to great.
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Contributing Writers Katie Davis Barry Cox Charlene Boyce David MacDonald Andrew Berzins
Whether you are a Mom and Pop business, medium size company or a Multi Billion dollar orga- nization, you have a story to tell and we look forward to telling it for you.
Welcome to Spotlight on Business Magazine from our entire team of researchers, writers, designers, marketing and production staff we all look forward to working with and for you.
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SPOTLIGHT ON BUSINESS • APRIL 2016
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EVERYTHING OLD IS NEW AGAIN Larlyn Property Management
04 SPOTLIGHT ON APRIL 06 CURRENT INDUSTRY EVENTS 14 ELECTION NOVEMBER 2016 16 SPOTLIGHT ON INNOVATION 18 SPOTLIGHT ON INDUSTRY 24 REBUILDING A COUNTRY 26 STRATEGIC LEADERSHIP, INTERNATIONAL ACCLAIM, AND COMMITMENT TO CANADA OHL Construction Canada 30 EVERYTHING OLD IS NEW AGAIN Larlyn Property Management 38 BALANCING CRAFTSMANSHIP & TECHNOLOGY Mission Bell 44 RECOGNIZING EXCELLENCE AT IT’S PEAK Monk Renovations
We spoke to the Chief Executive of Master Builders Australia in a week when news broke of the latest (financial) disaster involving tunnels in Brisbane, so it was with some diffidence that we asked Wilhelm Harnisch whether he could see light at the end of the tunnel in more general terms for the beleaguered industry.
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APRIL 2016 • SPOTLIGHT ON BUSINESS
NATIONAL CONSTRUCTION AND INFRASTRUCTURE LAW CONFERENCE Fairmont Banff Springs Hotel - Banff, Alberta, Canada The National Construction and Infrastructure Law Conference is organized by the Canadian Bar Association. The conference will cover areas like Canada’s economic outlook and the construction industry, buildforce ethics, developments of good faith in construction contracts, negotiating key construction contract provisions. April 1st & 2nd 2016
April 23rd & 24th 2016 THE FRANCHISE & BUSINESS OPPORTUNITIES EXPO Palais des Congrès de Montréal – Montréal, Quebec, Canada North America’s Franchise & Business Opportunities Event showcasing the fastest growing franchises & business opportunities with thousands of potential franchisees & business partners eager and ready to invest.
For more information http://www.franchiseshowinfo.com/ montreal-spring/visitor/
For more information visit https://www.cbapd.org/details_ en.aspx?id=NA_CONSTR16
HARD HAT EXPO New York State Fairgrounds – New York, New York, USA
HOME MODIFICATIONS AUSTRALIA NATIONAL CONFERENCE (HMANC) National Convention Centre Canberra - Canberra, Australian Capital Territory, Australia
April 6th & 7th 2016
April 28th & 29th 2016
Hard Hat Expo is a 2 day event which showcases products like hard hats and other protective
construction products and services and is the only gathering of construction equipment and services in New York etc. in the Building Construction industry.
The Home Modifications Australia National Conference is organized by the Arinex Pty Limited and will cover areas like Administration innovation, Design innovation, Diverse populations and complex cases, Funding and Finance, Marketing and Social Impact and many more.
For more information visit http://hardhatexpo.com/
For more information visit http://10times.com/hmanc
MIRAMICHI HOME & COMMUNITY SHOWCASE Miramichi Civic Centre - Miramichi, New Brunswick, Canada
BATC’S BUILDERS & REMODELERS SHOW Convention Center Hall E - Minneapolis, Minnesota, USA The leading residential construction trade show in the Midwest, this event brings together builders
April 7th 2016
April 30th & May 1st 2016
Miramichi Home & Community Showcase is a 3 days event which is being held at the Miramichi Civic Centre in Miramichi, Canada. This event showcases the latest technology products and services like Homebuilding and Renovation Industries, Building Cleaning, Maintenance and Security, Smartcard Technology, Mining, Concrete, Doors and Windows, Metal Detectors, Fire and Gas Detection, Marble and Granite Products, Security Glass and Screens, Community Resources, Health, Retirement, Children and Educational Program including Recreation, Retirement and Financial Planning etc. in the Building Construction, and Household Consumables Industries. For more information visit http://www.masterpromotions. ca/previous-events/miramichi-home-and-community- showcase-2016/
and remodeling industry profession to hear about new trends and product releases, tips for increasing productivity and profits, and solutions to the challenges of today’s marketplace.
For more information visit http://www.batcbrs.com/
UPPER MIDWEST ELECTRICAL EXPO Minneapolis Convention Center - Minneapolis, Minnesota, USA Learn about new industry trends and find out which electrical products are catching industry
April 13th & 14th 2016
and consumer attention.
For more information visit https://www.ncel.org/page.aspx?id=2
Please contact info@spotlightonbusinessmagazine.com to get your event spotlighted in our upcoming issue.
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SPOTLIGHT ON BUSINESS • APRIL 2016
ONTARIO NEWSPAPER TO END PRINT EDITION AFTER 149 YEARS
DONALD TRUMP DEMANDS ‘BIG CHUNK’ OF KEYSTONE XL PROFITS FOR THE U.S. Republican presidential front-runner Donald Trump says he would reject the Keystone XL oil pipeline if TransCanada Corp. didn’t give the U.S. a “big, big chunk of the profits, or even ownership rights.” All of Trump’s Republican rivals say they would immediately approve the pipeline from the Alberta oil sands, which Presi- dent Barack Obama rejected in November. Trump, who bills himself as a master negotia- tor, now says he would require TransCanada to fork over billions. Trump, campaigning as an economic national- ist, said he wants the pipeline approved. But he said TransCanada should not be allowed to send Canadian oil through American land without paying a price for it. Trump said, “When they do this pipeline, it’s going to be a very profitable thing, and it’s really Canada oil coming down — so it’s not — I like Canada, I want these people to be happy, but I want the developers of the pipeline to give the United States a big, big chunk of the profits or even ownership rights, like I do in business. That’s what I do.” Trump also declared that he is “not in love with the idea of taking Canadian oil.” He added: “I love Canada, by the way.” Trump once favoured rapid Keystone approval. He appears to be launching an effort to use the project as fuel for his attempt to challenge the patriotism and the eligibility of top competitor Ted Cruz, the Texas senator who was born in Calgary and held dual citizenship until 2014. “I want a big piece of the deal. Otherwise I’m not going to approve it. They will give us a lot.”
A newspaper with a history as old as Canada has printed its last issue.
Metroland Media Group printed it’s last edition of the Guelph Mercury, which was estab- lished in 1867.
The closure will affect 23 full-time and three part-time employees, according to a press release on the newspaper’s website.
The company said the newspaper was suffering financially, with circulation dropping to less than 9,000 home-delivery subscribers.
Publisher Donna Luelo said “the decision was not made lightly,” and that shutting down the print edition was the only viable option.
“The decline of classified and national advertising in recent years has made it impossible for the printed copy of the daily newspaper to remain profitable,” she said in the release.
We will have to wait until November to see how this reality show ends.
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APRIL 2016 • SPOTLIGHT ON BUSINESS
NIAGARA FALLS COULD BE ‘SHUT OFF’ TO FIX BRIDGES
New York State parks system is proposing to temporarily “shut off” Niagara Falls within three years to allow for the replacement of two 115-year- old stone arch bridges.
The plans would see the American Falls “dewatered” by diverting the upper Niagara River to the Horseshoe Falls in Canada while the work was carried out.
The two bridges, built between 1900 and 1901, provide pedestrians with access to Goat Island, but are deteriorating and temporary truss bridges were installed in 2004 over safety concerns.
If the plan is approved, it would be the second time the US side of the falls has been shut down.
In 1969, the US Army Corps of Engineers diverted the water to allow scientists to study the effects of erosion and the build-up of rock at the base of the falls, The Buffalo News reported.
According to a report, the temporary bridges are an “aesthetically unappealing experience for park visitors.” Niagara Falls attracts around 12 million visitors every year.
But restoring them to a working condition could cost up to $37.3M, the report adds.
Under the proposal, the parks department has come up with three plans - two of which involve shutting the water flow off using a cofferdam.
Plan 1: Would divert the water for five months between August and December. Plan 2: Would divert the water for the entire summer tourism season of nine months between April and December. Plan 3: Would be to not divert water but has effectively been discounted because it is too expensive and would take three years to complete. New York State’s Office of Parks, Recreation and Historic Preservation has said it could have a design approval in place by the summer and would take two years to complete the final design when funding was in place, along with permits and approvals, with construction taking approximately 24 months.
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SPOTLIGHT ON BUSINESS • APRIL 2016
ROGERS MEDIA TO CUT 200 JOBS ACROSS TV, RADIO, PUBLISHING DIVISIONS
TOP TWITTER EXECUTIVES TO LEAVE COMPANY, CEO DORSEY TWEETS Four senior Twitter executives are leaving the media company, according to a tweet from CEO Jack Dorsey, announcing the biggest leadership changes since Dorsey returned as chief executive as he struggles to revive the company’s growth. Media head Katie Jacobs Stanton, product head Kevin Weil, the head of the engineer- ing division, Alex Roetter, and HR head Brian “Skip” Schipper will all leave the company, he said. Addressing what he called inaccurate press rumors, Dorsey praised the four execu- tives and said he was sad to announce their departures. Twitter’s stock has fallen nearly 50 percent since Dorsey’s return last year and is now trading below its IPO price amid concern the company has failed to significantly boost its user base despite a quicker pace of product rollouts under Dorsey. Jason Toff, who heads Twitter’s video streaming service, Vine, tweeted that he was also leaving Twitter to join Google to work on virtual reality. Dorsey’s tweets did not mention him. In an earnings conference call in October, Dorsey spoke about “hiring and investing in talent” and the need for “bold rethinking.” Dorsey, who is also CEO of financial services technology company Square, has yet to lay out a detailed plan of what he wants Twitter to do differently. Dorsey plans a retreat with Twitter executives and work out a strategy, a source close to Dorsey said. Dorsey and Team have been hinting at new developments for the site, such as a increased character counts that would exceed the current 140-character limit. Twitter, which has just over 300 million users, had its slowest user growth in 2015 and was eclipsed by photo-sharing app Instagram, owned by Facebook Inc, which surpassed 400 million users last year.
Rogers Media announced that it plans to cut 200 jobs across its television, radio and publish- ing divisions. The company said the layoffs, which represent 4 per cent of its workforce, which began in February are said to “conclude as soon as possible.” Spokeswoman Andrea Goldstein said in an e-mailed statement, “The media industry continues to experience significant pressures from a softening advertising market, fierce competition from global players, and shifting audience consumption habits.”
She said the Toronto-based company identified cost savings in production, operations and procure- ment and “made the difficult decision to reduce headcount.”
The cuts will primarily affect Rogers’ conventional television, radio and publishing operations as well as back-office roles, Ms. Goldstein said. She said “today’s announcement impacts all areas of Rogers Media, except for the Toronto Blue Jays.” Rogers Media owner Rogers Communications Inc., which earns most of its revenues from its com- munications business, including cable television and Internet and wireless services, reported in the third quarter of 2015, that Rogers Media division posted an 8-per-cent increase in sales to $473-million. However, it attributed that to the playoff success of the company-owned Toronto Blue Jays baseball team, which led to higher advertising and revenue growth at Sportsnet, Rogers’ spe- cialty sports station.
Meanwhile, the company said conventional broadcast television and print advertising continued to struggle.
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APRIL 2016 • SPOTLIGHT ON BUSINESS
SEARS TO CLOSE MORE STORES IN COST-CUTTING EFFORTS
Sears Canada Inc. is stepping up its efforts to close another round of stores, raising more questions about its fate and putting pressure on landlords who already have a lot of empty retail space. The struggling Sears has instructed real estate firm CBRE to look for alternative uses for Sears’s weakest stores, such as its clearance outlets, Brandon Stranzl, executive chairman of Sears Canada, said in an inter- view this week. As well, Sears officials are working internally to shrink its store network, he said. He said “everything and anything” is on the table as Sears races to cut costs and revive its core full-line department-store business amid tumbling sales. “We’ve got this network we’re going to rationalize and we’re going to figure out which stores make the most sense,” said Mr. Stranzl, who took the top job last summer. “We’ve got a higher level of activity today than in the past few years” in looking to drop sites. Sears, which sold off some of its best stores over the past few years to raise money, is concentrating now on scaling back its underperforming real estate at a time when landlords grapple with a glut of vacant retail space after chains such as Target Corp. and Future Shop Ltd. closed their stores. Sears’s sales declines over the past decade underline the urgency for it to reduce its footprint. The retailer’s sales have plummeted by almost half to what is expected to be just more than $3-billion in fiscal 2015 from about $6-billion 10 years earlier. Tom Balkos, senior vice-president at CBRE Retail in Canada, confirmed it has been retained as Sears’s real estate adviser and “we continue to do work on numerous real estate efforts for them including various footprint rationalization efforts.”
Sears’s most recent store-closing plans differ from previous shutdowns, which involved landlords often approaching Sears with offers to buy back the retailer’s store leases to replace Sears with alluring foreign retailers betting that these new retailers will draw more customers. However with retailers such as Target and Future Shop closing all of their stores and Staples and Rona downsizing their operations, landlords no longer have enough compelling new retailers to fill so much space. This along with the additional pressure that online shopping is putting on traditional brick and mortar retailers and how quick they can adapt to the new ecommerce era. As for now, Mr. Stranzl said he has made no final decisions on the extent of closings. “We want to fix Sears as a mall-based department store, as a destination for home products in the home stores,” he said. “That doesn’t mean we’re going to keep all the home stores. That doesn’t mean we’re going to keep all the full-line stores.” It goes without saying that Sears’s recent review of its physical-space needs is consistent with what is happening in the marketplace with all long-time North American retailers and only time will tell if the right deci- sions have been made.
Sears has about 10 outlet stores, 40 home stores and 95 traditional full- line department stores.
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SPOTLIGHT ON BUSINESS • APRIL 2016
WAL-MART CANADA WILL START CHARGING FOR PLASTIC BAGS
Walmart Canada has announced that in an effort to promote the use of reusable bags and reduce waste, that it will start charging customers who request plastic bags at checkout. The new initiative is part of its ongoing efforts to ultimately achieve zero waste. The elimination of free single-use plastic bags was to be rolled out across Canada in February. Customers who request plastic bags at checkout will be charged five cents per bag. Walmart recognizes that it’s asking customers to change their shopping behavior, Lee Tappenden, chief operations officer of Walmart Canada said in a statement. “But we strongly believe that removing plastic film from our waste stream is imperative to reaching our goal of zero waste and will encourage our customers to broaden their already existing waste-reduction efforts.” He said that in other international markets, fees encouraging customers to use reusable bags has reduced single- use plastic bags by more than 50%. “Similar programs here in Canada have reported comparable successes,” he said. This was sent in October of last year when customers in England faced a plastic bag fee for the first time. It was the last country in the United Kingdom to adopt a plastic bag ban. At the time of the ban, consumers in England used 12 plastic bags per month. In Wales, where a bag tax has been in place since 2011, shoppers used two bags per month.
Tesco, Britain’s largest retailer, said in early December that the use of plastic bags have dropped 80% since England’s ban went into place.
In the U.S. some states have adopted similar bans. In July, grocery stores in Hawaii were banned from distributing plastic bags and about 150 cities and counties in California have instituted similar rules. A city- wide ban on plastic bags also went into effect in Chicago this summer. In announcing its plastic bag ban in Canada, Walmart cited a study introduced at the 2016 World Economic Forum in Davos, Switzerland says that by 2050, the ocean is expected to contain more plastic than fish by weight if there are no efforts taken to reduce plastic pollution.
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APRIL 2016 • SPOTLIGHT ON BUSINESS
AUSTRALIAN LEADERS UNITE FOR A REPUBLIC
Australian state leaders threw their support behind motion that the nation should not have to wait for the end of Queen Elizabeth II’s reign to cut ties with the British monarchy. Seven of the nation’s eight state and territory leaders have signed a declaration calling for an Australian head of state to replace the reigning royal in London. The only state leader not to sign up, Western Australia Premier Colin Barnett, said he also supported a republic but just did not think “the time is right.” Federal Prime Minister Malcolm Turnbull is already a noted republican, having passionately led the cause ahead of a failed referendum in 1999, as is opposition Labor leader Bill Shorten.
South Australia Premier Jay Weatherill said it would be “the ultimate act of respect” if the Queen presided over the transfer of Australia from a monarchy to a republic. “I think that’s something that she could preside over and do it in the elegant and expert way in which she has handled her relationship as head of Australia,” he told the ABC. Seven of the nation’s eight state and territory leaders have signed a declaration calling for an Australian head of state to replace the reigning royal in London. “I mean if you think about it, what are we waiting for? Are we waiting for her to die? I would have thought that it’s much more respectful to have her supervise this transition.” The British crown’s power in Australia is seen as largely symbolic, and while Queen Elizabeth II is hugely popular Down Under the monarchy is viewed by some as an anachronistic colonial relic. Support for a republic has wavered over the years, with a Fairfax-Nielsen poll in 2014 finding that 51 percent of people surveyed favoured the status quo compared to 42 percent supporting a republic.
Australian Republican Movement chairman Peter FitzSimons seized on the new enthusiasm.
“All of Australia’s political leaders now support an Australian head of state,” he told the Australian Broadcasting Corporation.
FitzSimons, who wants the process on a referendum over becoming a republic to start by 2020, said the declaration sent a message to the prime minister however Turnbull has previously said that he has more pressing priorities than turning the nation into a republic.
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SPOTLIGHT ON BUSINESS • APRIL 2016
TERROR IN THE WEST
THE NEW PRESIDENT
Experts predict the volatility of the Middle East will continue. Terror is the weapon of choice for organizations pursuing global notoriety. Recently signs of discontent with some western government’s proposed polices on gun control and immigration have created discontent with radical groups inside their own borders. Aggressive policy changes could be a catalyst for domestic terroristic activity. The shock of 9/11 was ravaging on Western economies. Experts allude that it played an indirect part in creating, and prolonging, the economic downturn in 2008. Terrorist activity on Western soil, foreign or domestic, could put economic recovery into turmoil for North America.
As the US’s closest ally and trading partner, Canada has a vested interest in the success of the US economy. Canada has persistently benefited by respecting, not always following, US policy on important items like; fighting terrorism, immigration, environmental protection and a host of other crucial issues. It is vital that the new US President affirm the country’s unrelenting conviction that Canada is a faithful ally. The potential challenge is rooted in the complex and controversial stances both Democratic and Republican candidates are promoting. It may prove very difficult for Canada to remain deferential to US policy while disagreements arise over pipelines, the Trans Pacific Partnership, and foreign policy. It is key Prime Minister Trudeau quickly build a strong rapport with whomever ends up in the White House even if it means taking a softer line on precarious issues. Tighter border controls, trade disputes and the repatriation of companies operating from Canada are just a few problems our economy cannot endure. The Canadian dollar is now so depressed a toonie is racing towards the value of what a loonie was worth 5 years ago when compared to the US dollar. This decline triggers a price increase for imported goods. Domestic products also rise for reasons like escalated costs of imported raw materials. The economic impact of a low dollar also includes inflation, lower adjusted incomes, capital projects cost esca- lation, and the possible exodus of our most skilled workers to other countries. Academics debate whether a low dollar is good or bad for an economy in recovery. The real world answer is perhaps both. The dilemma for Canada is the negatives like higher prices emerge more rapidly than the positives like boosted demand for Canadian goods and services. THE LOONIE DIVE
THE CRUDE TRUTH
Canada has become a one trick pony with GDP growth. Oil production has been the sector of the economy producing strong gains to safe- guarding us from recession. Global crude prices are still falling. Declin- ing prices eliminate good jobs, decrease exploration, degrade energy stocks and critically ravage previously robust oil and gas industry companies. Canada can muddle through an interim downward slide but a long term slump in oil prices will have permanent consequences for the energy sector. Thwarting the ability of the economy to handle lower prices is the problem that Provincial governments have become addicted to the tax revenue directly tied to petroleum products. With sparse alternatives to generate new revenue, cash strapped govern- ments will have to increase other taxes to replace the level of contribu- tion from items like gasoline. Tax increases slow GDP growth. Petro- leum contributes 27% of our national GDP and presently most of the growth. Pragmatically thinking analysts acknowledge that in the near future no other sector of the economy can replace the GDP growth oil production provides.
COMMODITIES, TAXES AND YOUR WALLET
The growing tax burden in most Canadian provinces is prohibitive to growth. The mounting individual debt load for middle and lower class workers is a warning sign of strained personal finances. If commodity prices skyrocket because of a weak loonie consumer spending will unques- tionably fall off. Consumer confidence indexes are wholly based on opinions and attitudes. Reporting a decrease in consumer confidence directly influences spending, the job market and investment. Time and again the tools used to rally consumer confidence have taken several quarters to transform an unenthusiastic outlook into optimistic spending behavior. The tax burden and debt payments for many workers precludes them from absorbing large price increases in essential commodities while maintaining their current spending patterns. Without strong consumer spending, the economy will not rally.
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APRIL 2016 • SPOTLIGHT ON BUSINESS
Written by Katie Davis T his title match is looking to have all the flair of a Floyd Mayweather, Jr. vs. Manny Pacquiao prize fight, with a much bigger title on the line, Leader of the Free World - President of the United States of America. Very much like a fighter has to climb the ranks to get the title shot, Clinton and Trump must secure the top of their parties ranking to make it to the title match this coming November.
2016 GENERAL ELECTION VOTE PREFERENCE Among Registered Voters
CLINTON TRUMP
NOW
Sept. 2016
Dec. 2016
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SPOTLIGHT ON BUSINESS • APRIL 2016
DEMOCRATIC CANDIDATES Hillary Clinton
DELEGATES
1681*
Bernie Sanders
927*
*as of Primary Results up to and including March 23rd, 2016.
The Democrats have two facing off for the chance at a title fight, Hillary Clinton and Bernie Sanders. Bernie Sanders is likely to start racking up a series of victories over the next two to three weeks as the Democratic primary heads out West. The big problem for Sanders is that many of the states where he is expected to do well are small. So while his supporters might be thrilled to see him on a hot streak, it’s unlikely that even sub- stantial wins will do much to change the underlying math of the race to 2383 to secure the Democratic nomination. REPUBLICAN CANDIDATES Donald Trump 739* Ted Cruz 465* John Kasich 143* *as of Primary Results up to and including March 23rd, 2016. The Republican race to 1237 Delegation to secure the nomination is much tighter than that of the Democrats, with Donald Trump, Ted Cruz and John Kasich still in the running. Donald Trump leads both Ted Cruz and John Kasich in the delegate count. The big question is whether Trump can reach the 1,237 delegates required to win the Republican nomination outright. DELEGATES
So come November and the election bell rings it will be very interesting to see if this is a first round knock out and over quick or if we go to the cards and the Judges’ decision.
Should it be a Trump vs. Clinton contest based on the polls as of March 21st, 2016 this is how they match up.
As we all know polls are not predictive, they only measure current sentiment and not future choices.
What matters are campaigns, platforms and voter turnout with the latter generally being that higher voter turnout is better for the Republican candidate, but this election has been like no other it is not about the past it is about the future. It has been about people wanting to be heard and we have seen a strong movement within both parties against the establishment, whatever that may be.
All I know is that for the next eight months the United States of America is the World’s reality show and everyone will be watching with a vested interest in who will OUTWIT, OUTPLAY AND OUTLAST.
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APRIL 2016 • SPOTLIGHT ON BUSINESS
IT IS ALL ABOUT BEING SMART.
THE CONSTRUCTION INDUSTRY IS LOOKING TO TAKE OFF When looking at latest technological innovation in the construc- tion industry the sky is the limit, well that may not be true anymore. Unmanned air vehicles (UAVs) commonly known as drones are hitting the construction industry by storm and experts believe that they will be a common tool on jobsites. With the cost of drones continuing to drop as more and more manufacturers move into the market place we are seeing the increase use of this technology for the commercial sector. Canada is ahead of the curve in North America, at least in terms of regulation as the U.S. Federal Aviation Agency does not permit the use of drones for commercial purposes, but with time this will change. In the construction industry, there are a number of different appli- cations that can benefit from the collection of aerial images and data, which include: site surveying and planning, construction documentation, safety and inspection, environmental reporting, lead line/cable delivery and positional marking. Drones can also be used to perform volume and planning calculations and thermal calculations. Drones can be programmed to fly a consistent path at a consistent height to ensure a consistent data set, without the We have our smart cars and our smart phones but it just might be the “Smart Helmet” that redefines workflow on the construction site. Topcon Positioning Group and DAQRI put their heads together and partnered up to create a wearable technology designed to change the way construction and survey professionals interface with the job site. The DAQRI Smart Helmet is an industrial-grade wearable that seam- lessly connects construction and infrastructure professionals to their work environments by providing them the ability to view valuable infor- mation about the project and job environment around them using aug- mented reality technology solutions allowing workers on the job to be safer and more productive. The DAQRI Smart Helmet is designed to bring wearable technol- ogy to a wider AEC (architecture, engineering and construction) user-base; empowering the user with a safe hands-free tool that can be used on the job. Both Topcon and DAQRI are committed to developing innovative solutions that power the future of work and are at the forefront of the Construction and Infrastructure industries with some of the most innovative products that are being used by millions of workers across a variety of environments. We look forward to seeing how our partnership re-defines the nature of ‘work,’ by setting a new standard for wearables in the AEC space..
human error that often creeps into data collection. Safety is another important element of drone use. A huge benefit in the construc- tion industry is that drones can increase the focus on safety on the job site as it can eliminate having to send employees into unsafe environments to collect data or for inspections.
We are seeing the increase use of this technology for the commercial sector.
It has been proven that drones clearly have a role to play on construc- tion sites. Now contractors need to consider that technology is evolving quickly, and early adopters may run the risk of investing in equipment that becomes outdated before the return on investment is realized. For some businesses outsourcing might be the way to go at first and you need to remember staff training and gear maintenance costs also have to be considered plus Transport Canada requires a Special Flight Operating Certificate (SFOC) for most commercial drone use. Whether your decision is to invest in the technology yourself or hire a service provider, it is very clear that the use of drones for commercial purposes is growing exponentially and soon will be as important to your business as computers and mobile phones.
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SPOTLIGHT ON BUSINESS • APRIL 2016
WHY YOU SHOULD HAVE A PAIR OF SOCKS IN YOUR TRUNK It looks like socks in the winter might not only be used to keep your feet warm and dry, but also to help you keep out of the ditch. We have all been there when you wish that you had a bit more traction, particularly when scaling a slippery hill or ascending an icy driveway. Beyond winter tires and all-wheel drive, there are aftermarket products that promise to provide added grip for occasional use. Consumer Reports recently evaluated three textile products that fit over tires to aid traction. Think of them as alternatives to clunky metal snow chains. Two of the products are AutoSock and ISSE, which resemble a cloth sock that slips over the tire. The Michelin Easy Grip looks and works more like a snow chain made out of rope. Like the “socks,” the Easy Grip slips over the tire. Installing these products is straightforward, but labour intensive as it takes some muscle and patience to slip one of these products over the tire. Yes they say they will increase tractions however, they are all intended for use on snow and icy roads only, and they have limited speed ranges of 25 mph (Michelin Easy Grip and ISSE) to 30 mph (AutoSock). You can purchase a pair for front wheel or rear wheel drive vechicles or they can paired up in a set of four for if you have an all-wheel-drive vehicle and want extra traction. Samples of Michelin Easy Grip cost approximately $140.00, the AutoSock wcan be purchased for approximately $110.00, and ISSE was the least expensive at approximately $80.00. Please keep in mind that prices will vary depending on retail outlets and sizes.
PAVEMENT THAT ACTS LIKE A SPONGE
We all know that you should not drink and drive, but soon the road will drink while you drive as interest in permeable concrete, pri- marily its ability to prevent devastating envi- ronmental damage caused by runoff is now being addressed. Topmix Permeable has been testing and dem- onstrating a product which is able to absorb more than 1,000 gallons of water in a minute in a paved parking lot. According to Lafarge Tarmac, manufacturer of Topmix Permeable, stormwater routinely overwhelms older U.S. wastewater systems, causing untreated sewage to be dumped into local waterways and onto public beaches and creating a significant source of pollution for rivers, streams and reservoirs. Products like Topmix Permeable are applied over a base layer of gravel and, depending on the permeability of the substrate, the water is allowed to either permeate the ground below or is diverted elsewhere, over a period of time, through a series of pipes which makes it an excellent solution for parking lots. However, the empty spaces in the permeable concrete that allow water to flow through have limited the product’s use in more rigorous applications, so more research and develop- ment is needed before testing will begin on heavily-traveled roadways, but all sign point that Lafarge Tarmac is heading in the right direction with this product.
SO WHAT HAPPENS WHEN THE SOCK MEETS THE SNOW?
The good news is all three products offer added grip on snow and ice. The bad news is installation can be tough, particularly when you factor in the cold. However if you need temporary traction to get out of a slick spot once in a while, these should be part of your winter emergency kit unless you have dedicated winter tires, which are more practical and versatile for the wide variety of winter conditions.
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APRIL 2016 • SPOTLIGHT ON BUSINESS
NEW MORTGAGE RULES GO INTO EFFECT
A CHANGE IS GOOD
OTTAWA — New federal rules for Canadian mortgages have now gone into effect.
Well if you are in the construction industry in North America you are looking for a change, but not in the way that you might be thinking. Industry numbers are showing that new builds are down however, that renovations and repurposing are more than compensating in the drop in new build numbers. On the residential side more than half of the construction invest- ment will be in renovations and maintenance work according to industry numbers. New builds will continue to decline even if we see a drop in leading rate as consumers look to increase the value of their current properties. On the Commercial construction side of the industry there looks to be a steady source of new production projects from coast to coast, North and South of the border however, repurposing commercial properties is a growing sector and one that should be looked at as an area of great opportunity as investors look to increase on their property’s return on investment. Again looking at the numbers it looks like a change is coming as both commercial and residential property owners look to reinvest to get the most out of their current properties, while still showing moderate increases in both residential and commercial construction.
The changes affect properties that cost more than $500,000 — a small percentage of the overall market.
Buyers can still have a 5 percent down payment on the first $500,000 of a home purchase but must now put at least 10 percent down on the portion above $500,000.
Finance Minister Bill Morneau has said the new measure aims to ensure buyers have sufficient equity in their homes.
Lenders also face new capital requirements to keep pace with the growing risk of the real estate markets that they bankroll.
And Canada Mortgage and Housing Corp. will change the fees it charges issuers of mortgage-backed securities.
The Finance Department has tightened mortgage rules on several occasions in recent years — along with requiring stricter enforcement and management of loans — to weed out marginal buyers and specu- lators. — The Canadian Press
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SPOTLIGHT ON BUSINESS • APRIL 2016
O TTAWA — The Canadian Real Estate Association says sales of existing homes rose by 8 percent cent last month compared to a year ago, while the national average home price soared 17 percent. CREA says the national average home price was $470,297 in January, fuelled largely by price gains in greater Vancouver and greater Toronto. However, excluding the piping hot markets of Ontario and British Columbia, the average sale price actually edged lower by 0.3 percent from a year ago to $286,911. “Canada’s housing market continued to exhibit some radical regional differences in January, consistent with the underlying economic picture,” BMO senior economist Robert Kavcic wrote. “Vancouver’s market is drum tight, with an almost unheard of 91 percent sales-to-new listings ratio (in other words, almost every new listing is getting absorbed within the month as record sales meet average growth in new listings). “On the flip side, sales and prices continue to retrench in markets exposed to oil prices. Sales in Calgary are now down more than 40 percent from their 2014 high, but prices have corrected a modest 3 percent to date.” On a month-to-month, seasonally adjusted basis, CREA says national home sales rose 0.5 percent in January, compared to December of last year.
Meanwhile, the number of new listings on the Multiple Listing Service declined by 4.9 per cent in January, compared to December. Though he expects the market to be “more of the same” for the rest of this year, Kavcic noted that “the explosion in price gains since the Bank of Canada began cutting rates last year might warrant some real concern down the road.” TD economist Diana Petramala said Toronto and Vancouver “are expected to be well supported by foreign investment and positive net interprovincial migration flows this year, but still ease off their cur- rently elevated levels.” Petramala predicts house prices will decline in those two hot markets next year. And “every month of double-digit home price growth raises the risk of a deeper home price correction down the road,” she added in a client note Tuesday. CREA chief economist Gregory Klump said single-family homes remained in high demand in Toronto and Vancouver last month, while a number of Alberta markets continued to see ample supply while potential buyers sat on the sidelines. “Tighter mortgage regulations that take effect in February may shrink the pool of prospective homebuyers who qualify for mortgage financing and cause national sales activity to ease in the months ahead,’’ Klump said. New federal rules requiring Canadians to put down larger down payments on homes that cost between $500,000 and $1 million took effect Monday. — The Canadian Press
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APRIL 2016 • SPOTLIGHT ON BUSINESS
SPOTLIGHT ON INDUSTRY
M ore than a few industries, such as agriculture, are apprehensive about the Trans Pacific Partnership. With few details to analyze, vexed industry groups have lost their poise. Many producers expect adverse blows to their prevailing operating model with reduced gov- ernment backing or the eradication of price controls. This uncertainty could slow investment and expansion in these sectors. In the absence of details, speculation rules. Clarity based on facts will unquestionably not emerge in the short term. Canada needs a significant increase in GDP and this type of uncertainty could cause delays or even eliminate long term investment by apprehensive producers.
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SPOTLIGHT ON BUSINESS • APRIL 2016
T he Canadian construction industry, like many industries in Canada, is faced with seeing its work force get older as our population ages. Over the next 10 years the Canadian construction industry will need to build on its recruitment efforts as skilled labour retirees looks to exceed 268,000. This is a major and ongoing challenge faced by the construction sector and one that needs an industry wide strategy blueprint to attract and recruit young people to the industry along with those working in other industries and sectors in addition to workers from outside of Canada. Making the industry as they say, “Sexy,” to a young work force will be a change but one that I am confident that the industry can do. Given the higher post sec- ondary education cost, more and more young adults are looking to the trades as a career. Over the last 10 years many industry specific schools have emerged through partnerships with Industry Leaders and Employers to give our young adults an opportunity to learn the trades of the industry and join the skilled labour market.
With a down turn in the resource industry, more and more skilled workers are making the transition to the Construction industry; this migration will help to reduce the need for skilled labour in the short term, with the key being to retain these workers once the resource sector rebounds. Good news comes from immigration fromoutside of Canada. The number of Economic Immigrants coming into Canada is at one of the highest levels that we have seen in the past 10 years. All indicators show that these trends will continue to help build our skilled labour force. In 2014, 260,404 Immi- grants came into Canada with 165,089 of those claiming Economic Immigrant status, which is good news for employers.
Any way you look at it there is a lot of work to do and be done to meet the needs for skilled labour in Canada’s Construction Industry, but I am confident that industry leads are up for the challenge.
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APRIL 2016 • SPOTLIGHT ON BUSINESS
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SPOTLIGHT ON BUSINESS • APRIL 2016
Written by Katie Davis S hipments of motor vehicles, auto parts, food and beverages were the driving force behind Statis- tics Canada reporting the highest increase in manufacturing sales on record in January. As per data released by Statistics Canada, Canadian factories sold $53.1 billion worth of goods in January, which is an increase of 2.3 percent from the previous month’s level.
Sales of automotive parts continued to show growth for the fifth con- secutive month increasing by 4 percent to $2.7 billion, which puts Canadian auto part sales at their highest level since 2006. Statistics Canada also states that a shift to higher-value vehicle pro- duction had made a difference in the dollar value of Canadian auto production, while the low Canadian dollar had helped exports.
As we look regionally, eight provinces recorded higher sales in January
Food sales also increased, this is partly related to the lower Canadian dollar pushing up wholesale costs. Food sales are normally fairly steady regardless of the economy but they rose 4.6 percent in January to $8.4 billion, the highest value ever recorded. Kirkland also states that, “We remain optimistic that much of these gains will be sustained in coming months as the past declines in the loonie and robust U.S. domestic demand continues to support Canadian shipments.” As we look regionally, eight provinces recorded higher sales in January, led by Ontario and Quebec. British Columbia, Saskatchewan, Manitoba, New Brunswick, Prince Edward Island, Newfoundland and Labrador all saw slightly smaller increases. The only provinces to record declines were Alberta and Nova Scotia.
Automotive sales increased 9.6 percent in January to $6.6 billion, the highest level since November 2000. Statistic Canada attributes the increase was due to two things, increased sales of higher-end expensive cars and the plunging value of the loonie (Canadian Dollar). However not all this increase can be explained by the weaker loonie making things appear to be more expensive. TD Bank economist Warren Kirkland states, “The volume of goods sold is returning to their pre-recession highs,” and that Canadian facto- ries simply produced and sold more products in January.
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APRIL 2016 • SPOTLIGHT ON BUSINESS
Written by Katie Davis N ow that they, the Liberal government has control of the House of Commons in Canada they have delivered their first federal budget with a promise of government-fostered economic growth. FinanceMinister Bill Morneau far exceed a “modest” $10 billion deficit that was a major part of Liberal election platform during last Fall’s campaign, elevating the Liberals from third-party status into power with amajority gov- ernment and mandate. We can expect higher deficits throughout this Liberal mandate as all this gov- ernment spending takes its toll on the budget balance, as this current Liberal offering will add almost $12 billion to the federal deficit in 2016-17 alone, bringing it to $29.4 billion.
The Liberal election campaign promised modest deficits of $10 billion annually to fund infrastructure spending, with a return to balanced budgeting by the next election, expected in 2019. However, Morneau’s budget speech emphasizes that by the time of the next election, Canada’s debt-to-GDP ratio, a measure of how affordable Canada’s deficit spending is relative to the strength of the economy, should be lower than it is today, albeit only slightly. According to the 2015 Liberal election platform, “We have two fiscal anchors that guide our overall fiscal framework” — reducing the federal debt-to-GDP ratio annually until reaching 27 per cent in 2019-20, when the party promised a return to budgetary balance.
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SPOTLIGHT ON BUSINESS • APRIL 2016
SO BUDGET DAY 2016 HAS COME AND GONE, SO LET’S TAKE A LOOK AT WHAT IS IN IT FOR CANADIAN BUSINESS. Trudeau and his government are now, all in, betting heavily on funding a growth agenda for the economy. While many of the projects named in the budget are targeted for spending over the next two years, it also includes projects the government will spend on over longer time frames. The promise to spend on infrastructure was a centrepiece of the Liberals’ 2015 election campaign platform. The party pledged to spend $125 billion over 10 years in a bid to “kick-start” the Canadian economy. The 2016 Budget expanded an existing $65-billion program the Liberals inherited from the previous Harper Conservative government. In this Budget, the Liberals will spend some $3.4 billion over the next three years to upgrade and improve public transit across the country. Money to be allocated to provinces and territories based on their share of national public transit ridership. Another $5 billion was set aside over the next five years to go to water, wastewater and so-called “green” projects designed to respond to climate change. That includes $2.2 billion for clean water, waste water and waste management in First Nations communities. $3.44 billion has been set aside to build social projects, such as subsidized housing, rec- reation centres and daycares. Plus Trudeau and his government want to continue to have talks with Canada’s premiers to develop strategies for positioning Canadian cities to be more competitive internationally however; The 2016 Budget does not change the corporate tax rate for small businesses, a move much-discussed during the fall election campaign. As for military spending, the Federal Budget does reallocate $3.7 billion for large-scale capital spending planned for the Canadian military between 2015-16 and 2020-21, pushing it off to later years. However, the government argues this is not a reduction in the Defence Department’s budget, but a shifting of the spending forward to the years when the military expects to be ready to make these purchases.
Morneau’s most recent pre-budget projections have debt-to-GDP rising to 31.8 per cent next year (from 31.0 per cent in 2015-16). As for balanced books in 2019-20, Trudeau has called it a “difficult” challenge. “Difficult” is a good word to use when speaking of deficit figures as they fail to capture how the Canadian economy is doing. The federal deficit calculations are based on economic growth forecasts. The Liberals have taken a more pessimistic view of these forecasts compared to the private sector forecasts from February. We must understand that the government has only so much control over the factors that go into determining the debt-to-GDP ratio. It ultimately decides how much money it piles onto the country’s debt by running a deficit (or pays down by running a surplus), but it doesn’t directly control how much the economy grows or what interest rates are.
Previous to the release of the budget Trudeau said in the House of Commons, “Confident, optimistic economies are willing to invest in their future, in their children’s future.” What we must ask ourselves is; are we investing in our future or mortgaging our present, only time will tell if the right decision was made.
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APRIL 2016 • SPOTLIGHT ON BUSINESS
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