McJobs? How about competitiveness?

The manufacturing sector was a hot topic among the three party leaders in Ontario yesterday. Tory and Hampton criticized McGuinty for replacing permanent positions in manufacturing and forestry with "McJobs." McGuinty countered by saying most of the new jobs created still pay about twenty bucks an hour -- and they're outpacing the lost ones three to one.

There are two problems as I see it.

One is the high dollar, of course. It wasn't going to stay low forever and I think too many companies thought it would. They decided to ride out the ebb for as long as it took rather than invest in newer and better technologies that would allow them to stay competitive when the dollar, as it did, eventually did go back up. Provincial governments can't control the markets and even the Bank of Canada is independent of the federal minister of finance.

However, our high corporate tax structure is definitely an issue. On top of corporate income taxes, companies are required to pay their share of CPP (with no refunds for overpayments, unlike we civilians), EI (at a rate 40% higher than we employees pay), as well as the full cost of workers' compensation and the corporate health tax. Not to mention property taxes -- and benefits.

McGuinty cited the decision of Toyota to locate in Woodstock as an example Ontario is competitive. Toyota, however, counters by saying Ontario had a leg up anyway -- Woodstock is just down the road from another facility in Cambridge, as well as near auto parts plants in the whole Golden Triangle, Woodstock and the GTA -- and the steel plants in Hamilton. What won it for Ontario, though, was public health care. In the States, the Japanese auto plants are already $25 per hour per capita below the Big Three in terms of worker costs ($48 vs $73) but they still have to provide a gold plated medical plan to its workers.

Do the math. When in the States a company's biggest supplier is a health insurance company; and in Canada it's electricity, it doesn't take a genius to figure out where we should be trumpeting our strengths. Despite tax and power holiday breaks promised by the southern states, Toyota still came out ahead here -- even with currency swings.

Besides -- who wants to turn in a power wrench at a car plant (one that's closing) for a call centre providing technical and concièrge services to people who purchase those vehicles. That's the case with GM, for instance. The plants in Oshawa are downsizing or even closing all together, but the call centre for OnStar (in Oshawa) is as busy as ever. Of course, OnStar has been nearshored to a third-party contractor.

There's no doubt we need more manufacturing jobs. They help pay for the service sector which Ontario is becoming reliant on. We also need to make sure the lumber and minerals continue to be mined also. Ontario has many resources, human and natural; and so far I don't see anything from any of the parties on how to strengthen both.

Just the blame game.

So far, I'm not impressed.

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