I have never understood why the enterprising economic developers in Nova Scotia and New Brunswick have never made any serious push to attract the back offices of the financial services industry. Many of these jobs pay very well and require a high level of skill. We already have many of the bank call centres (TD, RBC, CIBC) but it doesn’t seem we have made any real effort to move up the value chain on this sector. Halifax has made a few inroads here with that Bermudan company and with Seamark but really not a considerable effort.
And I think the potential is awesome. Toronto, for example, has quietly built up a significant hedge fund sector over the past year. There are thousands of people working in this sector (and related). However, there is really no need to locate researchers, junior analysts, planners, actuaries, etc. in Toronto. The front office, yes, but the back office no.
And with increasing pressure on fund companies to drop their MERs (expenses), alternative locations make a lot of sense.
There was a time when there was a logical progression to things. Toronto, New York, LA, etc. would get too costly for such business functions and they would move to lower cost areas in North America (consider call centres in the Maritimes or in Iowa).
Now, in the financial services sector, India is jumping the queue. They are aggressively pursuing these very jobs that, I think, offered great potential for this region. Now, India will ween off any potential economic benefit that this sector could have posed for the Maritimes.
What would’ve it took to attract this sector? Not much, in my opinion. These three elements would have been a good start:
1. Aligning college/university diploma/degree programs to the needs of the industry. Pump out hundreds of trained researchers, junior analysts, etc. each year.
2. Market the heck out of the region as a place for financial services (Ireland did a great job at this).
3. Leverage the English/French dynamic.
And finally, don’t underestimate the potential of ‘coming down the road’ (instead of the oft used ‘going down the road’). When a major company recently announced they were setting up in the Maritimes something like 70 of their staff said they wanted to move down here. I still run into people that moved here from Calgary, Toronto, etc. to work for OAO in Moncton. I think if good quality, back office financial services jobs were announced for Saint John or Halifax, I think you would see a lot of exMaritimers moving back. Don’t forget, over 500,000 NBers have left this province since 1978. You have to believe that a fraction of them, at least, would move back for real jobs with real salaries.
Consider India again. I read recently that there is a reverse migration of Indian IT talent from Silicon Valley back to Bangalore to get in on the IT boom over there.
Goin’ down the road for most folks is a function of economics and no of geography. Fix the economics and you’ll fix the out-migration.