Photo: Google Maps
By Jock Finlayson and Kristine St.-Laurent
Statistics Canada’s latest survey of corporate headquarters provides updated counts of direct head office jobs for each province and the biggest metropolitan areas across the country. The data shows B.C., and Vancouver in particular, are falling behind.
The survey covers publicly traded and privately owned companies as of 2017. A head office is defined as an “establishment … primarily engaged in providing general management and/or administrative support services” to affiliated operations and lines of business owned by the company in question. In most cases, a head office oversees facilities/operations located in more than a single community.
The definition used by Statistics Canada captures large and mid-sized companies from every sector of the economy. Among large companies, some examples of locally based firms with significant operations in B.C. include Tolko Industries, Polygon Homes, London Drugs, Teck, Stemcell Technologies, Coast Capital Savings, and Ledcor Industries. The survey also counts firms that are headquartered in B.C. but whose activities are dispersed broadly across multiple jurisdictions (e.g., Methanex, Silver Wheaton, Lululemon).
Table 1 below shows the number of head offices, as well as direct head office employment, nationally and in the five biggest provinces for 2013 and 2017. Table 2 does the same for the leading Canadian metropolitan areas.
Image: Contributed
A few points are worth noting:
• From 2013 to 2017, head office employment in Canada rose by 1.4 per cent, but the number of head offices dipped slightly.
• B.C. ranks fourth among the provinces in both head offices and head office jobs. However, B.C. trails far behind third-place Alberta in head office employment, with less than half as many corporate jobs. This reflects the comparative paucity of large companies based in B.C.
• The number of B.C. corporate head offices dropped by 11 between 2013 and 2017, while metro Vancouver lost three headquarters over the same period.
• Somewhat surprisingly given the economic vibrancy of the greater Toronto area, metro Toronto also lost head offices over 2013 to 2017. However, the Toronto region gained head office jobs in the period.
• Within Canada, employment at head offices remains concentrated in Ontario (42.8 per cent), Quebec (23.4 per cent) and Alberta (16.4 per cent).
• The majority of head office employees work in census metropolitan areas (CMAs). Among CMAs, Toronto has the largest number of head office jobs (77,167 in 2017), followed by Montréal (42,619), Calgary (29,068) and Vancouver (15,783).
• Toronto also hosts the largest number of corporate headquarters, 696 as of 2017, followed by Montréal (385), Vancouver (239) and Calgary (213).
• While it’s home to slightly more corporate headquarters, metro Vancouver has barely half as many head office jobs as Calgary.
B.C. as a whole and Vancouver as a metropolitan region continue to struggle to develop a strong cluster of major corporate head offices. That’s worrisome, since the presence of locally headquartered enterprises of significant size is a powerful economic driver and a key factor in creating and sustaining high-wage employment.
Consultants at McKinsey describe metro Vancouver as a “minnow” in the North American context, judged by the modest number of large firms based there. When juxtaposed to sky-high housing prices, the weakness of metro Vancouver as a host community for corporate headquarters is even more striking.
Provincial and many municipal politicians in the Lower Mainland are obsessed with the issue of affordability. One way to improve overall affordability is to boost the incomes of employees and households.
Unfortunately, making progress on this goal will be very difficult without a thriving and expanding corporate head office sector.
Jock Finlayson is executive vice-president of the Business Council of British Columbia. Kristine St.-Laurent is a senior policy analyst at the Business Council of B.C.
All Columnists Stories
