POLITICS
10/19/2011 05:12 EDT | Updated 12/19/2011 05:12 EST

Canadian Shipbuilding Contracts: Halifax Cheers After Winning $25-Billion Deal To Build Fleet Of Navy Ships

CP
HALIFAX - Workers in hard hats waving Nova Scotia flags celebrated with a giant roar Wednesday when the Irving Shipyard won the $25-billion contract to build the navy's next fleet of warships, a moment that meant secure jobs in a province where work can be hard to find.

"I'll have a job till I retire now," said Adam Watson, a 31-year-old painter and sandlbaster at the shipyard.

Watson said he has been employed by the shipyard for 10 years and has seen some hard times with multiple rounds of layoffs.

"Now (that) I've got steady work it means great things for my life," said Watson, one of hundreds of workers who huddled inside an outdoor tent at the shipyard in anticipation of the announcement.

"I can move ahead and look at buying a house or buying a car, that sort of thing."

Premier Darrell Dexter, who has made himself the face of Halifax's bid, said he was elated.

"Today marks the beginning of a brighter future for Nova Scotia," beamed Dexter.

"A future that sees an entirely new generation of shipbuilders, a future that sees our sons and daughters be able to come home from the west."

Jim Irving, the shipyard's CEO, said the deal was boosted by community and political support throughout the province that backed the "Ships Start Here" campaign, which was launched to promote the bid as signs were planted on lawns across Halifax.

"Everybody in Nova Scotia who has put a sticker on their car, a lawn sign in front of their house, whatever you've done to help us ... you've been right there with us from the start," Irving said.

"And it didn't happen unless it was under the leadership of Premier Dexter."

The deal is the biggest chunk of a $33-billion federal shipbuilding program. Vancouver-based Seaspan Marine Corp. picked up $8 billion in contracts for non-combat ships. Another $2 billion for smaller vessels is to be allocated later to another shipyard yet to be chosen.

Earlier this year, Dexter ramped up expectations for Halifax's bid, calling a possible win the biggest industrial opportunity for the province since Confederation. He said it would be the equivalent of hosting the Olympics each year for 30 years as he launched a massive public relations campaign.

Ellen Farrell, a management professor at Saint Mary's University, said Dexter was not overstating the case.

"This is one of the largest shipbuilding contracts ever awarded in the world," she said. "So we can expect that it would have very far-reaching effects."

Farrell said winning the big contract is exceptional because it would provide a whole generation of shipworkers with permanent employment.

"Studies out of the U.S. show that a dollar in shipbuilding has one of the most lucrative returns in the long-run of a dollar spent anywhere," said Farrell.

Jamie Eves, a worker with four years of service at the Irving Shipyard, said with the announcement comes the hope that some of the workers who packed up and left Nova Scotia in recent years could return.

"No more layoffs, work all year round and a lot of people from out West can come home," said Eves, 32.

"It's pretty exciting."

As part of its bid, the provincial government touted two studies released in May that highlighted the benefits of awarding the larger of the two contracts to Halifax.Both were done for the Greater Halifax Partnership, a public-private organization that promotes economic development in the province's capital city.

A study by the Conference Board of Canada said the combat ship contract would create 11,500 additional jobs in Nova Scotia during the peak of construction in 2020.

A second study by Jupia Consultants said the average personal income in the province would increase by $447 annually, helping residents buy an additional 750 new cars each year and 420 houses.

Both studies said spinoffs would be shared across the province, the region and the country.

Ugurhan Berkok, a politics and economics professor at the Royal Military College in Kingston, Ont., said about $5 billion of the total $25-billion contract will be spent in Nova Scotia, where the Halifax shipyard will undergo a substantial upgrade.

The rest of the money will be spent in Ontario, Quebec and the United States, where contractors will be hired to build the ships' combat systems, electronics and propulsion units, he said.

"The Maritimes don't have those industries," Berkok said in an interview, adding that U.S. defence contractor Lockheed Martin will likely join forces with Irving Shipbuilding as the project moves ahead.

The two companies are already working together on a tidal energy project in Nova Scotia.

At least one fledgling business sees the major contract as a "real opportunity."

Brad Murray of DSTN, a wind farm parts manufacturer based in Trenton, N.S., said his company would welcome any work that might come its way, such as fabrication.

Murray said the project will also be a long-term win for businesses in the region because it will attract skilled workers back to the province.

"All across the province and in other parts of the Atlantic provinces, many of the workers have gone west and they are very much recognized for their capabilities and work ethic," he said.