Hiring climate said to be 'modest' in coming quarter

Canadian employers expect to hire cautiously in the next three months, with job seekers more likely to have success in Western Canada than in Ontario and Quebec, according to a new survey of hiring intentions.

The latest quarterly employment outlook survey from Manpower finds that employers are forecasting only a "modest" hiring climate in the April-to-June period, with new business growth at its weakest level in five months.

Manpower's survey of more than 1,900 employers across Canada found that 16 per cent were planning to increase staffing levels, while four per cent were planning to cut them back.  

The healthiest hiring climate is in the Western provinces, with the rosiest opportunities in the construction, transportation and public utilities sectors.

"However, job growth is expected to be slower in Ontario and Quebec, with limited advances in full-time work expected for the coming quarter," said Manpower Canada vice president Byrne Luft in a statement.

Manpower said hiring intentions nationally fell two percentage points from the previous quarter to nine per cent. That represents a three percentage point drop from the outlook's forecast of a year ago. 

The weakest prospects are among manufacturers of non-durable goods.

Employment figures released last week by Statistics Canada showed a net loss of 7,000 jobs in February, with Quebec shedding 25,500 jobs.

Only 95,000 net new jobs have been created in Canada in the last year — a growth rate that is considered weak by historical standards. Job growth in the last six months has been especially weak. 

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Fuel costs to trim record airline profits

Rising jet fuel prices will eat into the world's airline profits, but the industry is still on track for a record year, an airline lobby group forecast Wednesday.

The International Air Transport Association, which represents 240 airlines, forecasts that the global airline industry will earn a profit of $18.7 billion in 2014. That's a record. But the figure is $1 billion lower than its previous profit estimate in December.

North American airlines are expected to be the industry's biggest profit driver, with record 2014 profits of $8.6 billion. That's more than double the previous most profitable year — 2010's $4.2 billion.

The Geneva-based group now forecasts that fuel will average $108 US a barrel, up $3.50 from previous projections.

That will add $3 billion to the industry's fuel bill this year — a figure that will be partially offset by stronger demand in passenger and cargo traffic as the global economy recovers.

"“In general, the outlook is positive," said IATA director general Tony Tyler in a statement. "The cyclical economic upturn is supporting a strong demand environment. And that is compensating for the challenges of higher fuel costs related to geopolitical instability."

But he said industry returns remain at an "unsatisfactory level with a net profit margin of just 2.5 per cent." 

Tyler credits industry consolidation and joint ventures with helping to improve the bottom line.

Industry revenues are expected to total $745 billion this year, with average profit per passenger of $5.65.

Besides rising fuel costs, the airline industry also points to such geopolitical risks as the decision by Venezuela to prevent airlines from taking profits out of the country and the crisis in Ukraine.

The disappearance of Malaysia Airlines Flight MH370 over southeast Asia is, at this point, another unknown.   

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Average Wall St. bonus up 15% to $164,530 US

CBC News Posted: Mar 12, 2014 9:44 AM ET Last Updated: Mar 12, 2014 8:31 PM ET

The average Wall Street banker's bonus last year rose to the highest level since the recession, and up to the third highest figure on record, new data out of the N.Y. state comptroller's office showed Wednesday.

"Wall Street navigated through some rough patches last year and had a profitable year in 2013," New York State Comptroller Thomas P. DiNapoli said. "Securities industry employees took home significantly higher bonuses on average."

The typical Wall Street worker took home $164,530 US in bonuses last year, the data shows. That's up 15 per cent from 2012's level and dwarfs compensation seen in any other industry.

The most recent data from Statistics Canada shows the average salaried worker earned $933 a week in December 2013. That works out to just over $48,000 a year — less than a third what Wall Street bankers were paid on top of their base salaries.

There's also evidence, however, that New York bankers may feel they're earning their pay. Total reported profits for broker/dealer operations among the big banks totalled $16.7 billion in 2013. That's 30 per cent less than the $23.9 billion they made in 2012 but still strong by historical standards.

Indeed, the industry as a whole has definitely rebounded from the financial crisis it started. Wall Street's securities industry has now been profitable for five consecutive years, including the three best years on record, the comptroller's office said.

If there's an area in which Wall Street is still hurting, it's likely in job numbers. DiNapoli estimates the securities industry employed 165,200 workers in New York City in December 2013, which is 12.6 per cent fewer workers than before the financial crisis. 

It's still an economic engine for New York, though. Wall Street makes up five per cent of the private sector jobs in New York, but it's responsible for 22 per cent of all the wages paid. And the state collected $10.3 billion in taxes from the industry last year, the data shows.

Mar 12, 2014 4:41 PM ET Mar 12, 2014 4:34 PM ET Mar 12, 2014 4:15 PM ET Mar 12, 2014 4:34 PM ET Mar 12, 2014 4:41 PM ET

The data on this site is informational only and may be delayed; it is not intended as trading or investment advice and you should not rely on it as such.

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Datawind aims to make $20 tablet computer

The Canadian makers of the "world's lowest cost tablet," the UbiSlate 7Ci, think $37.99 still isn't cheap enough.

They figure there's still room to knock about 50 per cent off its price and make tablet ownership possible for anyone and everyone.

"This idea is to bridge the digital divide, it's really that simple, the idea is to overcome the affordability barrier," says Datawind CEO Suneet Singh Tuli during an interview at his Toronto-area office, one of five the company has in Canada, England, Germany and India.

"We think as the Scandinavians do that (internet access) is a fundamental human right."

On the second floor of an unassuming strip mall — strategically located within spitting distance of Toronto's Pearson airport, where Tuli says he's coming from or going to a few times a week — the Datawind team is working on its strategy to sell cut-rate "good enough" tablets.

Datawind CEO Suneet Singh Tuli says the company's founders think internet access is a fundamental human right. (Parivartan Sharma/Reuters)

The company is best known for its work with the Indian government, which it supplied with low-cost tablets for a program to get technology into the hands of students.

Datawind was recently named one of the world's 50 smartest companies by the MIT Technology Review magazine for launching those tablets, branded under the Aakash name.

While India's government is considering proposals from Datawind and other vendors to make the next version of the Aakash, the company has turned its attention to North America and the U.K. to sell its tablets directly to consumers under the UbiSlate brand.

The cheapest version of the seven-inch tablet, the UbiSlate 7Ci, has a not-too-sharp screen resolution of 800 by 480 pixels, four gigabytes of memory, half a gigabyte of RAM, runs a current version of Google's Android operating system and can only get online with WiFi. It sells online for $37.99 plus taxes and shipping. The next model up, the UbiSlate 7C+, costs an additional $42 to gain access to EDGE mobile networks. The most expensive model, the UbiSlate 3G7 at $129.99 plus taxes and shipping, has a better screen and processor and can also access HSDPA 3G mobile networks.

Tuli says the company can sell the tablets so inexpensively because of the scale of its production runs and the fact that it makes its own screens, which helps boost profit margins. A preloaded web browser also displays ads that generate additional revenue for Datawind — although users can choose to download another ad-free browser — and the company monetizes some downloads of apps.

Datawind has also kept its prices down by selling directly to consumers through its website and not seeking retail partners.

"Something that costs $50 to make ends up at $150 easily at retail," he says.

"In our case, something that costs $32 to make ends up at $38 in the consumers' hands."

Tuli says he envisions the price of Datawind's lower-end tablet slipping below $20 "within the next year or two," especially if revenues from ads and apps grow.

"We think pricing will continue coming down and we think features will continue going up. We will keep our high end between $100 to $150, we don't see ourselves going up anything higher than that, but we'll continue pushing the barriers on the lower end," he says.

While he insists that Canadian consumers won't find the tablets lacking, the reviews for Datawind's tablets in India were far from positive. And anyone who has used an iPad or a higher-end Android tablet will notice a major difference in performance.

But he believes there is a strong market of consumers who are willing to trade performance for a low price.

"What we tried to focus on was realizing that for our customer, price is the most important feature and starting with that element we said, 'What can we bundle in to provide a performance experience that would be good enough for them?"' Tuli says.

"You want something for your kids to take to school.... Kids are going to lose them or break them and you want something that you're not worried (about)."

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Paul Reichmann, real estate magnate, dies at 83

Once the head of the largest real estate development company in the world, which went bankrupt in 1992, Paul Reichmann died Friday in Toronto. He was 83.

The reclusive Reichmann brothers built Olympia & York into a major international development firm after starting out as a small company marketing flooring and tile in Toronto.

The five Reichmann brothers were the sons of Orthodox Hungarian Jews who fled central Europe during the Second World War.

Older brother Edward started Olympia Flooring and Tile in Montreal and was joined in Canada by Paul, Albert, Louis and Ralph. After the brothers began a small company in Toronto, Paul Reichmann was the force who parlayed it into a global real estate empire.  

Their developments included First Canadian Place in Toronto, the World Financial Center (right next to the World Trade Center in New York), and Canary Wharf in London.

Paul Reichmann was born in Vienna in 1930, where his father, Samuel, had his business at the time. His mother's name was Renée.

Paul Reichmann is shown in London in 1989. He was the driving force behind the huge Canary Wharf development in the British capital. (Canadian Press)

By sheer luck, in 1938, the family was visiting Paul's grandfather in Hungary when the Nazis occupied Austria and annexed it with Germany.

They settled in Paris for a time, but by 1940, the Nazis were there too. Late in life, Reichmann could still remember the Nazi bombing of refugees south of Paris.

The family moved to Tangier in Morocco, where they prospered, as his father became a successful currency trader.

When the war ended, Paul studied religion in Britain and Israel, and became a rabbi. In 1953, he went back to Morocco and became a shirt retailer. That same year he married Lea Feldman.

In 1956, Paul joined his brother Edward in Montreal. Then, joined by brothers Albert and Ralph, they started a development business in Toronto.

Initially, they built warehouses and commercial buildings. Their first major project was the development of Flemingdon Park in Toronto's Don Mills neighbourhood.

In 1971, they advanced right into the heart of Toronto's financial district and won the contract to build what was then Canada's tallest building, First Canadian Place, at King and Bay streets.

By the 1980s, Olympia & York was the largest property development firm in the world, having bought a portfolio of skyscrapers in New York.

"He seemed to have this extraordinary knack of being able to see value where other people couldn't see it, and also extracting value from the buildings he built by financing them in creative ways and raising money to go on to bigger and better things," said Peter Foster, the author of the 1993 book, Towers of Debt: The Rise and Fall of the Reichmanns.

In 1980, they got 50-per-cent control of Brinco Ltd., a natural resources development company in Newfoundland and Labrador. The next year they bought an 82-per-cent controlling interest in Abitibi-Price Inc., and they held a significant share of Royal Trust Company. In 1985, they bought Gulf Canada Resources Ltd.

Along the way, they had acquired English Property Corp., one of the largest developers in Britain. That was the company that enabled them to build Canary Wharf in east London, at once their greatest achievement and their greatest failure.

The largest real estate development in the world at the time, it boasted Britain's tallest building, One Canada Square.

It was Reichmann's vision (only now coming to fruition) that it would be a kind of Wall Street of London and successfully compete with the city's historic financial district known as the City.

But by the time it was finished in 1992, the London commercial property market had collapsed, bringing down Olympia & York.  In March of that year, Reichmann was forced to resign as president.

When it filed for bankruptcy in May 1992, Olympia & York owed more than $20 billion US to various banks and investors. It was closed down in 1993, and the Reichmanns were left with a small firm, Olympia & York Properties Corp.

There are several theories about what went wrong with Paul Reichmann's judgment when he embarked on the Canary Wharf enterprise.

His reliance on his own business instincts may have led him astray, claims Foster.

According to the president of Canary Wharf, George Iacobescu, the Iron Lady herself, Margaret Thatcher, had personally called to ask Olympia & York to take on the development, and she promised that the Jubilee Line of the London Underground would be extended to speed up the trip to Canary Wharf from central London.

That promise was key to the development's success. But the line was not extended in her time. It opened only in 2000, long after the demise of Olympia & York.

Paul Reichmann was famous for sealing deals with a handshake and not bothering with corporate lawyers, and he always kept his word. He may have thought Thatcher would do the same thing.

The Olympia & York bankruptcy did not leave Reichmann poor by any means. In 2011 he was still listed among the richest Canadians. At number 30 on the list, his net worth was given as $1.83 billion, and that was up slightly from the year before.

In his usual secretive manner, Paul had continued with canny investments. For instance, he owned 70 per cent of Central Park Lodges, which in 1999 operated 74 retirement homes, 63 in Canada, the rest in the U.S., according to the National Post.

He was also involved in a $107-million project in Israel, according to the Jerusalem Post newspaper.

His company, IPC Jerusalem Ltd., built a five-star hotel and luxury condominium, called The Palace Jerusalem — The Waldorf Astoria Collection.

In 2004, he again bought a controlling stake in Canary Wharf, a development that by then was considered essential to the fabric of London. He gave it up in 2009.

Reichmann always lived humbly and austerely, in keeping with his ultra-Orthodox Jewish beliefs, even to the point of closing down his many development projects, and allowing no work there on the Sabbath.

"His accomplishments were titanic, just look at the Bank of Montreal building for example," said Tom Caldwell of Caldwell Securities. "Yes, he got bushwacked in Canary Wharf in England, but he came from a small business to play in the big leagues and he played it well. And he played it with dignity."

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