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Tillsonburg jobs losses 'sad,' 'predictable,' says prof

A University of Guelph economist says yesterday's shuttering of the Siemens wind blade manufacturing plant in Tillsonburg was not only sad, but predictable.

Guelph economics professor Ross McKittrick predicts the same will happen to Ontario's solar industry

Siemens says industry change has forced it to pull the plug on its Tillsonburg plant less than five years after it opened because the new wind blades are bigger than the Tillsonburg plant can build. (Colin Butler/CBC Butler)

A University of Guelph economist says yesterday's shuttering of the Siemens wind blade manufacturing plant in Tillsonburg was not only sad, but predictable. 

"Very sad story obviously for the employees and for the town. It's however very predictable as well," said Ross McKittrick. "The whole green energy economy is an artificial economy created with subsidies."

Ross McKittrick is a professor of economics at the University of Guelph and a senior fellow of the right-leaning think tank the Fraser Institute. (Ross McKittrick)

The University of Guelph economics professor, and senior fellow with the right-leaning think tank the Fraser Institute, argues the Ontario Liberals were betting that subsidies for green energy manufacturing would provide the province with a steady stream of manufacturing jobs, even at the cost of other manufacturers withering under high prices for power.

McKittrick said now that the Liberals have pulled the plug on wind power, all bets are off. 

Artificial green economy

"Companies like Siemens were only around for subsidies," he said.

"We'll see the same thing on the solar side," he said. "The companies who are set up to make solar panels, they aren't exporting them around the world. This isn't entrepreneurship where we have some advantage in this field and we're going to be world leaders. These are plants set up to take advantage of government programs." 

While Ross' prediction remains to be seen, it seems, you don't need a PhD in economics to see the Tillsonburg plant closure coming. 

"It wasn't a huge shock," said Tom Paulson Tuesday, moments after Siemens let him go, along with 206 other employees working at the wind blade manufacturing plant. 

With no job and no prospects, the 24-year-old former factory worker blames a shift in the political winds. 

"I do," Paulson said. "With Donald Trump down south, he doesn't really like the green energy, so that's definitely not helping us and with the Liberal government cutting the wind power that's not helping us either."

"I think most people took it well, they knew it was coming," says Tom Paulson, one of the 206 workers who were terminated from the Siemens Tillsonburg Wind Blade manufacturing plant Tuesday. "It wasn't a huge shock. (Colin Butler/CBC News)

Siemens cites changing industry

Siemens doesn't seem to see it that way. 

Siemens Gamesa Business in Canada head David Hickey blames price pressure and "significant changes" in the wind industry market for the fact it pulled the plug on the Tillsonburg plant. 

He also pointed out the Tillsonburg plant is too small to accommodate a new standard blade which is bigger.

"The factory is constrained. So we'd have to make additional investments to bring in this new technology, which would mean we would no longer be cost competitive," he said.

Once the conversation shifted to the province's energy policy however, the executive clammed up. 

Siemens executive David Hickey won't say whether he saw the Tillsonburg plant closure coming 0:39

"The eastern Canada market outlook has changed," is how Hickey answered one question about the shifting winds of the provincial government's energy policy. 

"Were you caught off guard?" asked a reporter. A question to which Hickey didn't offer a direct answer. 

"My focus today is really about the employees," Hickey he said. "Today has been a really difficult announcement."

Energy Minister Glen Thibeault would not immediately agree to speak with CBC. His office issued a statement a few hours after the Tillsonburg plant closure was announced. 

"While we are saddened by the news out of Tillsonburg," he wrote. "We are confident that as Ontario looks towards the future, green energy will remain an important part of both our electricity supply mix and our economy, supporting jobs and growth all across the province."

About the Author

Colin Butler

Video Journalist

Colin Butler is a veteran CBC reporter who's worked in Moncton, Saint John, Fredericton, Toronto, Kitchener-Waterloo, Hamilton and London, Ont. Email: colin.butler@cbc.ca

with files from Nathan Swinn and Natasha MacDonald-Dupuis