Northern Gateway jobs just ‘pipe dreams’: report

By John Woodward, CTV News, March 20, 2012

A new report claims that the promise of 10s of thousands of new jobs created by the proposed Northern Gateway pipeline is just a "pipe dream."

Estimates of job creation promoted by Enbridge, the company behind the pipeline, are about 10 times too high, according to economist Marc Lee of the Canadian Centre for Policy Alternatives.

"I think there are a lot of wild claims being made about the economic benefits of the pipeline, that it's in Canada's national interest, but if you look really closely there are fairly few jobs being delivered by the pipeline," he told CTV News.

The proposed $5.5-billion Enbridge pipeline would take Alberta oil to Kitimat, where it would be loaded on tankers bound for Asia.

Enbridge has claimed the project will create 63,000 person-years of employment. That's another way of saying the project will create the equivalent of 21,000 full-time jobs over the period of its three-year construction.

That estimate includes construction jobs, but also jobs the company estimates will be created as spinoffs when the people employed in the construction spend their wages. It also includes the jobs created from the pipe manufacture.

The CCPA, a left-leaning think tank, provided CTV News with an advance copy of their study entitled "Enbridge Pipe Dreams and Nightmares," which is expected to be released on Wednesday.

Lee's estimates discounted the claims of spinoff jobs, arguing they are too difficult to quantify,and assume that the people in those jobs were already unemployed. He also pointed out there is no guarantee that other jobs involved in pipe manufaturing will be in Canada.

"The only jobs we can bank on are approximately 1,850 construction jobs per year for three years, and a handful of permanent new jobs once completed," he wrote.

In total, that's only 5,536 person-years of employment – less than a 10th of those claimed by Enbridge, he said.

Enbridge representative Paul Stanway told CTV News the company has done detailed modelling of the economic impact of the project.

"It's not surprising to see we're seeing people taking potshots at the project but we stand by our projections," he said.

Still, Lee's report is one of a number that have questioned economic claims about the pipeline.

Economist Robyn Allan, who wrote a report on the Northern Gateway Pipeline that was released in January, said the pipeline would be bad for Canada because it would raise the local price of oil.

Allan reasoned that if the pipeline was built, oil that had been sent to Eastern Canada would be redirected to Asia. With greater Asian demand for oil, local prices would increase by $2 to $3 a barrel each year, she reasoned.

Stanway said Enbridge would be willing to defend its math in front of upcoming hearings at the National Energy Board. Lee said he will also testify in front of the board.

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