Alberta city finds itself at greatest risk of sweeping disruption by automation
Report reveals manufacturing in Brooks most vulnerable to threat of job cuts
A radio disc jockey interrupts the country music playing to an empty room at Ricky’s All Day Grill in Brooks, Alta.
He wants to take a minute, he says, to recognize Gissela Ramirez, a recruiting supervisor who left her corporate law gig in Guadalajara, Mexico to work at the slaughterhouse and beef-packing plant in Brooks. The facility, owned by the world’s largest beef-processing company, Brazil-based JBS, is the biggest employer in town.
The shout-out is part of a regular segment to remind listeners of JBS’S dedication to its workers and to Brooks, a city of almost 15,000 along the Trans-canada Highway about halfway between Calgary and Medicine Hat. JBS employs 2,800 people in the community, and it’s growing. But those jobs — and many others in Brooks’ manufacturing- and trades-focused labour force — are facing the prospect of sweeping disruption; according to an internal federal government analysis obtained by The Logic, jobs in Brooks are more vulnerable to automation than anywhere else in Canada.
More than one in four jobs in the city could have at least 70 per cent of human tasks replaced by machines, according to the analysis from Finance Canada, which The Logic obtained through an access-to-information request.
While the report doesn’t identify JBS specifically, it notes that manufacturing is particularly vulnerable — a sector that makes up the bulk of Brooks’ workforce. “Less-diversified local economies mean that rural areas and small towns are less likely to adapt if incumbent sectors and businesses are disrupted,” the report reads.
On a visit to Brooks in early December, The Logic heard from several community members who credit JBS with helping Brooks weather the Western Canadian economic downturn, bringing in newcomers and offering reliable employment as energy sector jobs leave the region.
“It’s Steady Eddie work,” says Bill Turner, who owns an automation company in Brooks that builds remote controlling systems for the agriculture, oil and manufacturing sectors. “People have seen ups and downs so many times; they said, ‘Piss on it, we’re going to go work for JBS.’ ”
At the same time, however, the company has deployed millions of dollars to develop robot butchers — technology that could someday replace the workforce it’s building up.
“Any time someone is doing something manual, there’s an opportunity for automation,” says Mayor Barry Morishita, a former auto parts dealer and longtime Brooks city councillor who was elected mayor in the wake of the most recent oil downturn.
“But if you said in 10 years JBS would have just 300 workers at its plant, that would scare the sh-t out of people here.”
Three days of fog and nights below zero have left a layer of crystals clinging to every undisturbed surface of Brooks — the heritage-tree branches, the blades of spent wheat, the vacancy sign outside the Tel Star Motor Inn. Smoke billows over the JBS facility as trucks delivering cattle disappear behind the network of buildings. The smell of blood is overpowered by the scent of manure wafting from the feedlot across the highway.
By many measures, Brooks is a classic company town.
JBS branding is slapped across the sprawling community sports and recreation facility and on the jerseys of the city’s beloved hockey team, the Brooks Bandits. It claims to sponsor the majority of non-profit initiatives in town, and it drives the ranching industry, purchasing 70,000 cattle from the local feedlot every year.
“Basically, that’s the story of this community now,” says one local rancher whose company didn’t authorize him to speak on the record. “The city is the plant.”
JBS personnel would not let The Logic inside the facility, and its Calgary-based president, David Colwell, also declined an interview request. When asked about the automation at the plant, a spokesperson based in Colorado said in an email that “current automation in the Brooks facility is limited,” but that the company is “constantly seeking ways to enhance innovation and improve worker safety and overall performance through the use of automation.”
In 2015, JBS invested US$41 million for a controlling stake in New Zealand-based robotics company Scott Technology. The firm specializes in fully automated butchering, carving out perfect cuts of meat from whole animal carcasses. A video of the process shows skinned and gutted lambs travelling along a conveyor in a personless factory. The carcasses are X-rayed at various points in the production line, with sensors sending information about the size of the carcasses and the positions of their bones to the dexterous knife-wielding robots.
Scott’s technology mainly butchers lamb and pork, which tend to be easier to robotically process than beef. But since investing in the company, JBS has been testing its rib-cutting bots on cow meat in Australia. “It’s about making sure that our beef-processing sector and our industry remains globally competitive,” said Richard Norton, then-managing director of Meat and Livestock Australia, a public authority that represents the interests of the country’s meat industry, in a promotional video for the technology.
Paying people to do the work is a significant cost to JBS.
At one facility in Greeley, Colo., the company pays over US$100 million in salaries to some 3,000 workers every year. But the cost to develop and integrate robots into its operations isn’t cheap, either.
In Brooks, where many jobs at the plant start barely above minimum wage, manpower is still cheaper than full automation.
“Some of the stuff they do is an art,” Morishita says of the plant workers at JBS. “But I can see when, at some point, the return on investment on automation does make sense.”
Second to manufacturing, the oil sector was the biggest industry in Brooks, but many jobs in the field left the community when oil prices were slashed in 2014.
Five years later, while some drilling has returned, a dearth in transportation capacity has kept prices down and the community of Brooks quiet.
“At six o’clock in the morning, this main drag to Tim Hortons was like rush hour,” says Turner, whose automation company works with most of the oil companies in the region. “Since 2015, you could throw a rock down there in the morning and not hit anybody.”
“We’ve had businesses close,” says Morishita, sipping his latte at The Steaming Cup, a coffee shop along Brooks’ small commercial strip. “There’s a lot of empty space in the industrial park.”
If not for the growing workforce at JBS, he says, the impact on the city would be far worse.
The fear of mass layoffs isn’t hypothetical for Brooks; it has happened before. In 2012, 2,000 workers were laid off from the plant, then owned by XL Foods, in the wake of a tainted meat scandal.
Cases of E. coli linked to the plant forced the company to recall over 1.8 million kilograms of beef, the largest meat recall in Canada’s history, and eventually pay $4 million to settle a class-action lawsuit.
“There was a lot of uncertainty during that time,” says Morishita. “It was scary. It was very scary. The scope and scale of the economic devastation would have been immeasurable — we couldn’t even imagine it at the time.”
To deal with the immediate fallout, the city formed a community response team with representatives from local and provincial organizations to help laid-off workers file employment insurance claims, improve their English and find new jobs.
The XL Food workers were eventually reinstated, but the experience left the city with a lingering anxiety over future mass job losses. The community response team, now a group of about 60 organizations, meets once a year to plan for the worst. “God forbid we ever have to do it again, we’re prepared,” says Morishita.
Brooks isn’t the only place where automation threatens to displace workers. A 2016 report from the Brookfield Institute predicted that current technology could perform the majority of tasks in almost 18 per cent of jobs across the country — putting them at high risk of automation. And the internal federal government analysis obtained by The Logic identifies rural communities and small towns scattered across Canada that face similar fates as Brooks. In Lachute, Que. — a 12,000-person town heavily reliant on manufacturing and retail — 27.2 per cent of jobs are at high risk of being automated. And in Summerside, P.E.I. — which also largely depends on the same industries — 22.9 per cent of occupations were identified as high risk.
The dynamic has captured the attention of think tanks, post-secondaries and corporations focused on the future of work — predicting what jobs will be in demand when automation takes over, and retraining workers with the skills to do them. For its part, the federal government this year launched the Future Skills Centre, a $375-million Ryerson University-run program meant to prepare workers and local economies for the changing labour market.
The centre has 16 pilot projects underway, studying shifts in industries like oil extraction, auto manufacturing and trucking.
In fact, there’s a chance the creation of jobs could outpace the obsolescence of others. A 2015 report from Deloitte found that from 2001 to 2005, the U.K. lost 800,000 high-risk occupations, while 3.5 million low-risk jobs were added over the same period.
“The challenge there is, it’s very hard to predict what jobs will or won’t be in high demand 10, 15 or 20 years from now,” says Sunil Johal, a fellow at the Public Policy Forum, an Ottawa-based non-profit think tank. “We have a hard enough time doing that for two or three years out right now.”
Absent a crystal ball, Johal suggests governments and employers focus on training people for skills they need now, as well as for those that transfer to stable occupations, like in the health care or tech spaces. “And where we can, let’s try to diversify our economy so that if one particular sector takes a downturn in job numbers, either through automation or other factors, we’re better positioned to weather that downturn,” he says.
Dozens of people, mostly men, are bundled up, sipping teas and coffees and socializing on their day off at the Tim Hortons on 4 Street in Brooks on a Saturday afternoon.
“Everyone here works at JBS,” says a man named Damen, a butcher at the plant who moved from Ethiopia for the job; his friend Michael, sitting across from him, came from Uganda for the same reason.
The employment opportunities at JBS are the driver behind immigration in Brooks; it’s the second most diverse city in the province, just behind Edmonton and ahead of Calgary, with visible minorities accounting for more than a third of its population. People in Brooks collectively speak more than 100 languages, and the city holds two citizenship ceremonies a year now — it had 206 attendees at the last one in September, according to the mayor. Under previous ownership, the plant used to hire mostly through the federal temporary foreign worker program; JBS now works with settlement and employment agencies from across Canada to attract people who want to put down roots in Brooks. “In less than 30 years, we’ve gone from a very Euroethnic community to having people from all over, and JBS can be commended for that,” says Morishita. “That’s helped give newcomers a sense of community, and huge opportunity for people to take charge of their lives.”
Some of the stuff they do (of the beef packing plant workers at JBS) is an art. But I can see when, at some point, the return on investment on automation does make sense.