Cameco shut down will have regional economic impact

By Glenn Hicks
November 10, 2017 - 9:05am

Cameco said it is committed to assisting employees who’ll be temporarily laid-off at its Key Lake and McArthur River operations.

Recessed uranium prices forced the mining company to announce Wednesday a 10-month closure at the two operations starting in January. That will affect around 850 employees, many of them from Prince Albert and northern communities.

The company said around half of the employees were from the North and there would also be a knock-on effect for regional suppliers.

“We have very strong relationships with our stakeholders and have done a lot of work to make sure northern communities participate and have a voice in the industry,“ Communications Director Gord Struthers told paNOW.  “That is not going to change as a result of this.”

While Struthers said it was very early in the process to determine exactly how salaried employees would be financially affected by the temporary lay-offs, discussions were underway with United Steelworkers Union on a plan.

“It involves some topping-up of employment insurance benefits and we would also extend some benefit coverage to affected employees as well," Struthers said.

The job losses, although temporary, will have an impact on the regional economy and there is also the possibility of losing some employees as they head elsewhere for work. Struthers acknowledged that.

“We have a highly trained and skilled workforce at our operations and we’re going to look after them,” he said.

Brooke Dobni is a Professor of Strategy at the University of Saskatchewan’s Edwards School of Business. He said the loss of 850 jobs will have a negative impact.

“It’s going to have a fairly large impact” he said. “There are a lot of folks who commute from P.A, northern communities, Saskatoon, and Edmonton, so it’s going to be felt throughout the region.”

And Dobni figured there would be an impact on communities at the retail level.

“A key indicator of economic well being is consumer spending, “ Dobni said. “Once they pull back on that it has a trickle down effect on store owners, and then there may be fewer people working in the stores.”

Dobni also noted the risk of a brain drain as certain employees decided they can’t necessarily wait out the temporary 10-month closures and seek work elsewhere.

“A lot of [Cameco] jobs are specific but a lot of them can be trained up,” he said. “There’s no doubt companies don’t like to [shut-down] because they’ll lose good trained people who they’ve invested a lot of time and effort into.”

But Dobni said Cameco had little choice as they face very recessed uranium prices.

“You have to make decisions to be responsible in respect to the company and the bottom line,” he said.

 

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Fuller impact of Cameco closures becoming clearer

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