The Rise and Fall of Industrial Companies in Niagara (Part 1)

March 06, 2015

Some Background

In this two part series I will write about industrial companies that reside or have resided in Niagara. In part one, I will highlight some examples of companies that have left Niagara in a big way or all together, and in part two, companies that are rising stars or still have a strong presence in our great community.

Over the last several decades Niagara has seen a significant transition in its economy.  Simply put, we have gone from a heavily industrial based economy to one more aligned with tourism and agriculture.  I know firsthand as a member of the Niagara Industrial Association (NIA), however, that there is a large group of industrial business owners that are trying to turn the tide back to making this once again a key industrial region.

General Motors – A Once Proud History

General Motors started in St. Catharines in March 1929 after it purchased McKinnon Industries, which became a subsidiary of G.M. Canada.  Over the years many changes occurred, and in 1969 GM consolidated all plants into three; the engine, axle, and foundry operations. With employment peaking at almost 10,000 local workers, many residents of Niagara were proud of what GM had accomplished over the previous decades.  That would all come to an end when in 1996, GM closed its foundry, and one of its engine lines was halted.

The effect of this major closure had ramifications throughout the region and hurt many other businesses related to the automotive industry as well as many other sectors.

My Own Experience

As with so many others, I was fortunate enough to find summer employment with GM in the mid 1980’s in the security department.  I thoroughly enjoyed working there and to this day, I still touch base with a few of my colleagues from that time.  As a student, working at GM in the 1980’s and 90’s was considered a prize job since you got full time hours and made a significant amount over the minimum wage.

I remember walking throughout the plants on Ontario Street amazed by how large of an operation this was, only to become dismayed today as this once giant of a Niagara business now only consists of one plant and about 1,500 workers.  While GM is still very much important to St. Catharines and Niagara, it is but a shadow of its former self.

Unfortunate Statistics

Numbers found from a City of St. Catharines study, have some very unfortunate statistics relating to the job losses in the region over the last 14 years.  Here is just a sample of some of those numbers:

To be clear, these are just a sample of actual losses.  Between 2000 and 2007, Niagara lost a total of 5,952 manufacturing jobs with 35 plant closures.

Some Good News - Ontario Street Plants Never the Same Again

In late 2014 it was announced that the Ontario Street plants would be sold and redeveloped by The Bayshore Group out of Toronto and Budapest.  Bayshore is going to develop this land which is expected to be worth over $200 million.  I have met Robert Megna, president of the Bayshore Group who has already entrenched himself and his team into the Niagara community.  I got a real sense of commitment and pride coming from him as well as a whole lot of excitement in this new development for his company.

It is very sad to see Ontario Street change from its glory days of industry, but at least perhaps we will once again be proud that this property will go to good use and hopefully create many important jobs along the way.

Please find below an attachment to an article written in the St. Catharines Standard which highlights this new development.

The Solution

When the economic situation in a region is so dire there are two things you can do; fold up or fight back.  I like to think of Niagara as a region that is fighting back.  Niagara has had to reinvent itself in many cases as is evident in our growing Agriculture, Tourism, and what I would call Agri-Tourism; our wine industry.  The growth in our local wine industry has been absolutely phenomenal, and it continues to grow and prosper every day.

But is our industrial sector finished?  Not by a long shot.  Through my time at the Niagara Industrial Association (NIA), I have heard of many successes of where small and medium sized companies have changed the way they do business to compete, when many jobs are moving to places like Mexico.  This renaissance will be the subject of Part 2 of this series.

Michael Coholan
Portfolio Manager at ScotiaMcLeod