DRIVING EXCELLENCE | LABOUR MARKET REPORTS 2019 BUSINESS & FINANCIAL

Compensation Workforce Business & Benefits Trends & Financial Employment Forecast MCPCC | LABOUR MARKET REPORTS 2019 CONTENTS BUSINESS & FINANCIAL

MOTOR CARRIER PASSENGER COUNCIL OF INTRODUCTION...... 3 PART ONE OVERVIEW 4

DATA SOURCES ...... 5 INDUSTRY-SPECIFIC...... 5 PUBLICLY AVAILABLE INFORMATION...... 5 STATISTICS CANADA ...... 5 SECTOR DATA ...... 5 OCCUPATION DATA ...... 5 PART TWO BUSINESS ENVIRONMENT 7

INDUSTRY PROFILE...... 7 STRUCTURE...... 7 INDUSTRY REVENUES AND GOVERNMENT CONTRIBUTIONS...... 7 SERVICE PROVIDERS ...... 8 VEHICLES ...... 9 PART THREE VEHICLE PROGRESSION AND CLIMATE CHANGE 11

ELECTRIC VEHICLES (EV) ...... 11 CANADIAN CITY COMPARISONS...... 13 POWERING ELECTRIC VEHICLES...... 15 SUMMARY...... 16 AUTONOMOUS VEHICLES ...... 18 CONSULTATION SCOPE ...... 18 CONSIDERATIONS ...... 19 RESEARCH FINDINGS...... 20 CURRENT STATE OF AVS...... 20 LIMITATIONS OF AVS ...... 21 AV LEGISLATION ...... 21 AVS IN PUBLIC TRANSIT ...... 21 PART FOUR PUBLIC SECTOR INVESTMENT 22

URBAN TRANSIT...... 22 FEDERAL...... 22 ...... 22 ...... 22 ONTARIO...... 23 QUEBEC ...... 24 SCHOOL ...... 24 PART FIVE RIDERSHIP AND SERVICE 25

PART SIX EMPLOYMENT COSTS 27

PART SEVEN LABOUR MARKET IMPACT 29 AGEING WORKFORCE...... 29 RECRUITMENT ...... 29 SUSTAINABILITY OF AND RURAL BUS COMPANIES ...... 29 PART EIGHT CONCLUSION 30 ENDNOTES...... 31

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MOTOR CARRIER PASSENGER COUNCIL OF CANADA INTRODUCTION

The MCPCC provides a crucial National forum for industry, labour, government, and education to share resources and information .

MCPCC’s work is focused on several key areas: raising awareness of and advocating for the bus industry across Canada, reaching government, education, and the public; reporting much needed www.buscouncil.ca labour market information, recognizing the outstanding service of bus professionals; promoting industry-wide career opportunities, and the exceptional training and development that has contributed to the industry’s commendable safety record.

MCPCC is constantly seeking innovative ways to work with industry and government to promote the Bus Industry as a critical link in the nation’s transportation infrastructure. It is a privilege to advocate for the exceptional men and women dedicated to this essential service.

For more information, contact

MCPCC 10350 Yonge Street, Suite 206 Richmond Hill, Ontario L4C 5K9 Tel: (905) 237-0533 [email protected]

©All rights reserved. The use of this publication, in whole or in part, reproduction, storage in a retrieval program or transmission in any form or by any means (electronic, mechanical, photographic, photocopying or recording) is prohibited, without the prior written permission of the Motor Carrier Passenger Council of Canada, and is an offense under the Copyright Act.

Copyright © 2019 Motor Carrier Passenger Council of Canada (MCPCC)

This project was funded in part by the Government of Canada Sectoral Initiatives Program The opinions and interpretations are those of the authors and do not necessarily reflect those of the Government of Canada

3 PART ONE OVERVIEW

The motor carrier passenger industry has significant economic increase profitability of an integrated transportation infrastructure. and societal influence on Canada and Canadians. The many Our Industry has fully embraced these opportunities for growth, benefits include: public mobility, cost-efficient transportation progress, and innovation. that stimulates economic development, environmentally sound solutions to traffic congestion, reduction of energy consumption While mass public transportation will remain the backbone around and improved air quality. which sustainable mobility solutions will thrive, complementary solutions are making the passenger transportation market more Over the past few years, the industry has seen a transformation complex. The trending technological innovations have ironically to digitization, and the emergence of new mobility players. reinforced the importance of the human aspect in public Digitizing transportation services, if done well, can improve the transportation as our mission is to serve the public effectively while efficiency, create better experiences for customers and ultimately adapting to changing structures.

KEY TRENDS IMPACTING THE INDUSTRY

KEY TRENDS POTENTIAL IMPACTS DEMOGRAPHICS • Ageing Population • Loss of skilled workers • Increased average age of workforce • Smaller labour pool • Migration and Immigration • Economic growth constrained by labour shortages • Urbanization • Curtailments/cancellations of rural services TECHNOLOGY • Automation • Job loss • Artificial Intelligence • Restructuring of existing occupations • Digitization • Emergence of new jobs and careers • Increased demand for advanced technical and “soft” skills • Falling demand for mid-skilled jobs CLIMATE CHANGE • Electrification • Challenges for carbon-intensive sectors • Increased investment in “green” sectors • New skill requirements • Initial higher procurement costs

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DATA SOURCES OCCUPATION DATA PART ONE Survey of Employment, Payrolls and Hours3 INDUSTRY-SPECIFIC • Provides a monthly portrait of the amount of earnings, as well as the number of jobs (i.e., occupied positions) and hours worked. OVERVIEW • Ongoing consultations and interviews with participants • Information available at the 4-digit NOC level. from industry employers and employees, labour, associations, • Information available at the national and provincial/territorial education, manufacturers and governments levels. • Customized Industry surveys of a representative sampling of employers, owners, managers and human resources practitioners Job Vacancy and Wage Survey4 covering all sub-sectors in all provinces and territories • Job Vacancy Component of the JVWS collects data on the • A comprehensive review of secondary sources, databases and number of job vacancies by occupation and economic region internet search on a quarterly basis. Additional information is also available by occupation, such as the average hourly wage offered, the proportion of job vacancies for full- and part-time positions, the duration of job vacancies, and the levels of education and PUBLICLY AVAILABLE INFORMATION experience sought for the job. • Provides information at the 4-digit NOC code. The following section outlines publicly available labour market • Data can be split by province (Alberta, Ontario, Quebec, information, disseminated by the Canadian federal government. BC, Manitoba only provinces/territories that consistently provide at a quality at the “acceptable” level and above). STATISTICS CANADA • Data tables produced quarterly.

Statistics Canada administers five surveys that provide a snapshot Employment Insurance Statistics5 of current labour market events. These surveys are: the Labour • Reports on the operation of the Employment Force Survey (LFS, record number 3701), the Survey of Insurance Program. Employment, Payrolls and Hours (SEPH, record number 2612), • Provides complementary labour market statistics at the national Employment Insurance Statistics (EIS, record number 2604), and provincial level, as well as for sub-provincial areas. Job Vacancy Statistics (JVS, record number 5202), and the Job • The statistics released include the number of beneficiaries, types Vacancy and Wage Survey (JVWS, record number 5217). These of benefits, benefit payments, the number of claims, as well as surveys provide varying degrees of granularity and timeliness with the number of disqualifications and disentitlements. respect to bus industry labour market information. • Estimates are also produced by detailed age and for 140 occupation groups to the 2-digit NOC codes.6

SECTOR DATA Labour Force Survey1 (LFS) Statistics Canada also administers the Annual Passenger Bus and Urban Transit Survey. Data are typically released 2 years after • Provides estimates of employment and unemployment. survey administration and includes: • Survey results provided 10 days after the completion • Financial performance of the industry;7 of data collection. • Sources of operating revenue and expenses;8,9 • LFS data are used to produce the well-known unemployment • Capital expenditure;10 rate as well as other standard labour market indicators such as • Equipment operated;11 the employment rate and the participation rate. • Fuel Consumption;12 • Information available at the 2-digit NAICS level. • Maintenance costs;13 14 Job Vacancy Statistics2 • Employment and compensation; and • Revenue and passenger trips (urban transit only).15 • Provides a monthly portrait of the level of unoccupied positions, job vacancy rates and unemployment-to-job vacancies ratios. • All estimates are produced at various levels of cross-classification It should be noted that a change in the questionnaire in 2014 of geography (province and territories) and industry (available at limits the comparability of results for some questions. the 2-digit NAICS level).

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PART TWO BUSINESS ENVIRONMENT

Employment and Social Development Canada16 (ESDC) Limitations of Bus Industry LMI

ESDC uses the models of the Canadian Occupational Projection There are two principal and interrelated challenges associated System (COPS) and the National Occupational Classification with open bus industry LMI. Data that are available on a timely (NOC, 2016 version) to develop projections of future trends in basis (i.e., LFS) are typically rolled up to the 2-digit NAICS the numbers of job openings and job seekers for 292 occupational level (Transportation and Warehousing). This limits the ability groupings at the national level, covering the entire workforce. The to interpret these data specifically for the bus sector. Conversely, projections help to identify those occupations that may face labour data related directly to the industry, either at the 4-digit NAICS shortage or labour surplus conditions over the medium term. The or NOC code, typically takes much longer to be released, limiting latest projections cover the 2017 to 2026 period. the ability to interpret these data as they are no longer timely (i.e., Annual Passenger Bus and Urban Transit Survey).

Statistics Canada information is used with the permission of Statistics Canada. Users are forbidden to copy the data and re-disseminate them, in an original or modified form, for commercial purposes, without permission from Statistics Canada. Information on the availability of the wide range of data from Statistics Canada can be obtained from Statistics Canada’s Regional Offices, its World Wide Web site at http://www.statcan.ca and its toll-free access number 1-800-263-1136.

6 PART TWO BUSINESS ENVIRONMENT

INDUSTRY PROFILE

The motor carrier passenger industry of Canada, the bus industry, The structure of the industry has changed significantly as a result is a significant force in the Canadian economy, with business of widespread industry consolidations in the school bus, intercity activity of approximately 1,032 companies, generating more and tour and charter sub-sectors; which has repeatedly involved than $20 billion in 2017 operating and non-operating revenues, international investment. Selective evaluation of public/private and employing over 118,000 full-time equivalent people. It is an partnerships and inter-modal alliances is continuing, primarily essential component of Canada’s transportation infrastructure. motivated by economic and competitive issues.

STRUCTURE INDUSTRY REVENUES AND GOVERNMENT The industry encompasses five sub-sectors: CONTRIBUTIONS

• Urban transit systems Of the 20 billion of total revenues in 2017, urban transit • Scheduled intercity bus carriers predominantly publicly operated, is the sub-sector with the • School bus services greatest revenues (82%) with operating and non-operating • Tour and charter carriers expenses (75.5%) and net income (78.5%) from 2012-2017. • Accessible services () It should be noted that over 50% of urban transit revenues are operating and capital contributions from government, necessitated by the complexity of the urban infrastructure, combined with the essential nature of urban services.

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SERVICE PROVIDERS

Figure 1 provides a graphic of the number of business companies through amalgamation, which make up roughly 40% of the operating in Canada. There were 1,032 bus companies operating companies in the bus industry. The interurban and rural bus in 2017, down from the number of companies in 2012. This is due sector also experienced a downturn in the number of companies, primarily to a decrease in the number of school bus companies, decreasing from twenty-two (22) in 2012 to thirteen (13) in 2017.

FIGURE 1 : NUMBER OF BUS COMPANIES (CANADA) (2012-2017)

1,246

1,062 1,032 1,051 1 024 936

751

542 531 491 488 411

347 396 258 247 231 213

155 148 141 127 118 117 87 85 88 92 96 95 22 18 17 13 13 13

2012 2013 2014 2015 2016 2017

Urban Statistics Canada. Extract from Table 23-10-0081-01. Financial performance of the Interurban & Rural passenger bus and urban transit industries. School & Employee Charter & Sightseeing Other Total

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VEHICLES

While the number of bus companies has decreased since 2012, bus sector, which increased in total fleet size by 17% over that the overall number of vehicles has increased by 10% over that period. The percentage of the overall fleet owned by each time. Again, this change can be attributed primarily to the school sub-sector remained consistent between 2012 and 2017.

FIGURE 2: NUMBER OF VEHICLES OPERATED BY SECTOR (2012-2017)

74,367 76,433 76,460 69,346 71,588 69,092

42,872 43,291 38,057 39,658 36,733 35,788

17,736 18,014 17,915 18,402 19,148 18,604

9,017 9,264 10,642 9,166 9,175 9,330

5,859 6,253 6,152 5,736 5,248 5,235

2012 2013 2014 2015 2016 2017

Urban Motor Coaches School & Employee Other Total Statistics Canada. Table 23-10-0086- 01 Canadian passenger bus and urban transit industries, equipment operated, by industry and type of vehicle

School make up over Urban transit buses are Motor coaches, on the other half of the fleet of Canadian the next most prevalent, hand, make up only 7% of bus companies, representing making up 24% of the the total rolling stock for the 56% of all rolling stock. industry and 80% of the industry but are the primary School buses also make up urban transit sector. class of vehicles used in the 90% of the fleet in the school interurban and rural and charter and employee bus sector. and sightseeing sectors at 66% and 59%, respectively.

9 PART THREE MCPCC | LABOUR MARKET REPORTS 2019 BUSINESS & FINANCIAL VEHICLE PROGRESSION AND CLIMATE CHANGE It costs nearly twice as much to maintain urban transit CANADIAN BUS INDUSTRY FLEET COMPOSITION (2017) buses ($0.35/km) and motor coaches ($0.32/km) than school buses ($0.18/km). 13% The industry consumed 784.6 million litres of diesel 24% Motor Coaches fuel in 2017 - down 20.7% from 2016 - and 892.2 7% School Buses million kilowatts of electricity, up 5.9% from 2016. Urban Transit Buses Vehicle energy expenses accounted for 8.6% of total Other Rolling Stock operating expenses in 2017, up from 7.7% in 2016.

56%

URBAN TRANSIT

2017 SUMMARY OF REVENUE BUSES BY FUEL TYPE - REGULAR SERVICE

10,762

3,699 Number of Revenue Busses Number of 1739

355 242 262 10 Diesel Biodiesel Natural Gas Gasoline Hybrid Hybrid Trolley Battery Fuel Cell Diesel Biodiesel Fuel Types

Source: CUTA - summary of Canadian Transit Statistics 2017 Operating Data

10 PART THREE VEHICLE PROGRESSION AND CLIMATE CHANGE

ELECTRIC VEHICLES (EV)

The way people and goods move is set to change dramatically The 2019 forecast includes new analysis on how shared mobility over the next two decades, driven by a combination of policy, will impact vehicle sales patterns, on the long-term demand for technology, economics, demographics and changing consumer freight, and on how electrification will play out in the commercial preferences. vehicle market.

Bloomberg New Energy Finance (NEF)17 has produced By 2040 it is expected that 57% of all passenger vehicle sales and The Electric Vehicle Outlook which is their annual long-term over 30% of the global passenger vehicle fleet will be electric. The forecast of how electrification and shared mobility will impact road electrification of the global bus fleet is already well underway with transportation from now to 2040. This report draws on their team over 400,000 electric buses on the road. Commercial electric van of specialists around the world and also looks at how these trends and sales are set to accelerate in the 2020s. will affect electricity demand, oil use and demand for battery materials.

EV SHARE OF ANNUAL VEHICLE EV SHARE OF ANNUAL VEHICLE SALES BY SEGMENT FLEET BY SEGMENT 90 90 80 80 70 70 60 60 50 50 40 40 Percent

Percent 30 30 20 20 10 10 0 0

2019 2025 2030 2035 2040 2019 2025 2030 2035 2040

Buses Passenger Light Commercial Medium Commercial Heavy Commercial

Source Bloomberg/NEF. Note Passenger car and bus figures are global. Commercial vehicle segment adoption figures in both charts cover the main markets of China. Europe and the U.S.

The electrification of buses is also helping cut pollution in a meaningful way: for every 1,000 e-buses introduced, global demand for fuel drops by over 180,000 barrels per year 18.

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Urban buses are the first transport mode where electrification is having a significant impact today. This trend is driven primarily by the rising awareness of “Canada’s transit industry toxic air pollution in our cities from internal combustion engines and supported by the compelling economic, comfort, and noise advantages. We expect urban is working towards a buses to be the first transportation mode to reach zero emission thanks to more sustainable future. electrification. The impressive deployment of electric buses in China has been the We are transitioning to center of much attention, but what is the situation in Canada? greener propulsion systems, including electrification, to do our part in reducing greenhouse gas emissions and supporting our country’s international climate commitments.”

Marco D’Angelo Canadian Urban Transit Association CEO and President

Vancouver, B.C September 11, 2019, TransLink launches zero-emissions battery-electric buses and standardized high-powered charging systems as part of Canadian Urban Transit Research and Innovation Consortium’s (CUTRIC’s) Pan-Canadian Integration Trial

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CANADIAN CITY COMPARISONS

MONTREAL, QUEBEC

When it comes to zero-emission transit, has one of Canada’s most forward-thinking strategies. Not only does Société de transport de Montréal have zero-emission ambitions for 2040, but it has a clear plan for how it will get there. Between now and 2025, all new acquisitions will be hybrid or electric, becoming 100% electric after 2040. The wheels are already in motion, with the transit authority in the process of acquiring six rapid- charge buses, 30 slow-charge buses, and six other electric buses and para- transport vans from Canadian manufacturers. The move follows a successful test of three rapid-charge buses over an 18-month period in 2017 and 2018. During the trial, the buses were charged 11,000 times with an average charge time of three minutes, travelled more than 100,000 kilometres, and saved well over 100 tonnes of CO2.19

TORONTO, ONTARIO

The Toronto Transit Commission, which operates 140 bus routes across the Greater Toronto Area, is maneuvering its way toward a 100% zero-emission fleet by 2042. Toronto’s transit fleet, which is the third most heavily used in North America, has already begun the electric transition by acquiring 10 new 40-foot battery-electric buses from a Canadian supplier20 in 2018 as part of its Green Bus Technology Plan.21 These buses will soon be joined by additional electric buses, bringing Toronto’s e-bus total to 60 by the end of 2019 22 —increasing to 907 zero-emission buses by 2027. The transit authority will purchase only zero-emission buses starting in 2025.

MONTREAL TORONTO 100% zero-emission 100% zero-emission No zero-emission targets Reducing carbon pollution transit by 204027 transit by 2038-204229 but intends to implement a by 80% by 2050 and 31 TARGET “phased strategy” powering its entire fleet by renewable energy by 205033

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EDMONTON, ALBERTA

Edmonton is also joining the move to electric buses, recently ordering 25 overnight-charging buses to operate on the city’s routes from 2020.23 Before committing, Edmonton commissioned one of the most in-depth feasibility studies of operation in North America. When faced with Edmonton’s steep river valleys and plummeting winter temperatures, the buses fared well, with the study concluding battery-electric buses could operate efficiently and cost-effectively even during a deep freeze.24 When plugged into Edmonton’s grid, a battery-electric bus is expected to emit 38% to 44% less CO2 than a diesel equivalent—and as the electricity gets cleaner, so will the buses.24

VANCOUVER, BRITISH COLUMBIA

While battery-electric buses are making their debut elsewhere in Canada, Vancouver has been successfully operating electric buses of a different kind for more than 70 years. Vancouver is home to 262 operational electric trolley buses—the third-largest such system in North America.25 This year, Vancouver is diversifying its electric fleet with the addition of four new on-the-go charging battery-electric buses purchased from Canadian manufacturers as part of a partnership between TransLink, Natural Resource Canada, Metro Vancouver, and BC Hydro. The pilot project is part of a pan-Canadian initiative led by the Canadian Urban Transit Research and Innovation Consortium (CUTRIC).26 The first of four buses and two high-powered, standardized overhead charging systems went into service on September 11, 2019 in Metro Vancouver, with six more on the way.

TOTAL RIDERS FLEET SIZE

MONTREAL TORONTO EDMONTON VANCOUVER MONTREAL TORONTO EDMONTON VANCOUVER 429.5 million 533.2 million 87 million 407 million 1,837 1,920 1,032 1,075 in 201728 in 201730 in 201732 in 201734 in 201728 in 201730 in 201832 in 201634

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POWERING ELECTRIC VEHICLES The company is also taking orders for two additional electric bus models: the LionA, a 26-seat mini-school bus with a 306-kilometre There are four ways electric buses can get their power. range, and the LionM, a mini-bus designed specifically for the The top two are used by Battery Electric Buses. paratransit market with a number of accessibility features.35

Slow-charging Industries (NFI)

These buses charge slowly while not in use, usually overnight. New Flyer was founded in Winnipeg in 1930 with just five The buses then operate all day on a single charge. employees and is now the largest bus manufacturer in North America. The company has a manufacturing plant in Winnipeg as On-the-go rapid-charging well as four others in the U.S. A report by Bloomberg New Energy Finance suggested New Flyer is one of the biggest competitors These charge (sometimes wirelessly) while passengers are getting on for Chinese e-bus manufacturers BYD and Yutong in the U.S. and off, usually at a central bus station or strategic stops along the market.2 New Flyer makes hybrid, trolley-electric, battery-electric, route. The buses usually charge for five or six minutes every hour and fuel-cell electric buses including its “next generation” Xcelsior and, as a result, can operate continuously. Charge battery-powered bus with a 420-kilometre range. Of the 41,000 buses serviced by New Flyer, 18% are powered in some Trolley buses capacity by batteries or electric motors (such as plug-in hybrids), while 4% are entirely zero-emission.36 They draw power continuously from overhead wires, rather than onboard batteries. Trolley buses can only operate where wires are installed over the entire route. Nova Bus is a Quebec-based bus manufacturer with two Hydrogen fuel cells manufacturing plants in Canada and one in the U.S. In 2011, the -owned company decided it was time to go electric, With the same electric power train as a battery bus, hydrogen fuel developing the battery-powered model ‘LFSe’ to join its range of cell electric buses have a hydrogen fuel cell generator that produces diesel, hybrid, and natural-gas-powered buses.37 An 18-month trial power. Notably, Canada is home to several leaders in hydrogen fuel of Nova’s battery-electric buses in 2017 and 2018 by Montreal’s cell technology for buses, including Ballard Power Systems and transit authority saw the delivery of North America’s first on-the- Hydrogenics go charging technology. The trial resulted in the order of four additional buses, which will join its fleet this year. B.C. transit Canada is home to multiple North-America-leading e-bus provider TransLink has also decided to follow, piloting two manufacturers that, as the world moves to electrify transit, 40-foot Nova buses in its Vancouver fleet over the first few months are well-positioned to capitalize—provided transit authorities and of 2019. policy makers seize the opportunity. Here are four companies in Canada driving the battery e-bus transition. GreenPower Motor Company

Lion Electric Company Vancouver-based GreenPower is the only Canadian company to exclusively produce electric buses. The company sells a range of Quebec-based is North America’s largest buses, which are manufactured in California and come in eight supplier of electric school buses, employing 135 people and different models, including a school bus and 45-foot double- manufacturing all of its buses in Canada. Lion has around 200 decker, two of which are in use at Victoria’s cruise ship terminal e-buses on roads across the continent, with around 80 in Canada. on Vancouver Island. With an expanding order book of over 120 Lion’s electric school bus, the LionC, can be found on school buses, GreenPower intends to triple its production capacity over runs across North America, with the most in California. And the the next few years after leasing a new manufacturing facility in number of Canadian children enjoying an all-electric commute will California. The company plans to focus its expansion on its mini- soon rise, with Lion recently agreeing to supply transit provider buses and school buses.38 Keolis with 12 LionCs for its fleet of school buses in Montreal.

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SUMMARY

As cities across Canada set targets to substantially cut emissions Increased and expanded public transit can improve Canadians’ in the next two decades, the country’s transit authorities need to quality of life, enhance affordability, and cut carbon pollution. The make decisions now to ensure they remain on track. With battery federal government has invested $3.4 billion in transit since 2016, prices falling 79% between 2010 and 2017, e-buses are becoming and has committed another $20 billion over the next decade, increasingly competitive with diesel buses. According to Bloomberg which will be invested through bilateral agreements with provinces New Energy Finance, transit providers will be able to drive away an and territories.50 e-bus for the same price as a diesel bus by 2030, while also saving hundreds of thousands on fuel costs over the bus’s lifetime.17 To ensure this next generation of investment maximizes long-term pollution reduction and cost-savings, it should include a focus on zero-emission transit fleets and associated fuelling infrastructure, complemented by innovative financing that bridges the higher capital cost of e-buses with the long-term cost-savings they deliver. 50

LIFE-CYCLE ASSESSMENT INVOLVED IN TRANSPORTATION SERVICE DELIVERY

Materials Infrastructure Vehicle Fuel Infrastructure Vehicle & Extraction Construction Manufacturing Produciton & Vehicle Infrastructure Operation Maintenance

TTC’s first all-electric bus goes into service June 2019.

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The following graphs illustrate that with external acquisition carbon emissions, and health impacts also support the funding the on-going operating costs of vehicle life-cycle case for e-buses. Accordingly, governments should support ownership are considerably lower with e-buses. Additional costs transit authorities in developing plans to achieve 100% incurred by the use of diesel vehicles, such as poor air quality, zero-emission fleets.

NO EXTERNAL FUNDING Purchase costs Operating costs

$120,000

$100,000

$80,000

$60,000

$40,000

for a 40-foot $20,000 Lifecycle ownership costs per year 0 Rapid Slow charging Diesel hybrid Diesel Compressed Biodiesel Liquefied charging e-bus electric bus Natural Gas Natural Gas e-bus

EXTERNAL FUNDING PAYING FOR 80% OF BUS PURCHASE COSTS

$120,000

E-buses become $100,000 the clear winner once external funding helps to pay $80,000 upfront purchase costs $60,000

$40,000 for a 40-foot transit bus $20,000 Lifecycle ownership costs per year 0 Rapid Slow charging Diesel hybrid Diesel Compressed Biodiesel Liquefied charging e-bus electric bus Natural Gas Natural Gas e-bus

SOURCE: “Lifecycle ownership cost and environmental externality of alternative fuel options for transit buses.” Transportation Research Part D: Transport and Environment, 2017, Vol. 57. 17 MCPCC | LABOUR MARKET REPORTS 2019 BUSINESS & FINANCIAL

AUTONOMOUS VEHICLES 39,40,41,42

The emergence of autonomous vehicles represents the most CONSULTATION SCOPE significant change in transportation since the transition from The scope of the review is on automated vehicles which are capable horse-drawn carriages to motorized cars. And with the first of “driving themselves”. In other words, they can operate in an driverless vehicles expected to be publicly available in the next automated mode in which they are not controlled and do not need decade, governments, cities and companies around the world are to be monitored by an individual, for at least part of a journey. already contemplating the potential for massive change to our This differs from driver assistance technology, which needs to be environment. Consequently, there remains enormous technical, monitored by a human driver at all times. legal and social challenges in implementing automated vehicles. MCPCC will be conducting consultations over the two-year The Society for Automotive Engineers International (“SAE”) has period 2019-2021. The context of the consultations will be produced a six-level classification system for automated vehicles, “How AVs will affect the world of work and the workplace”. ranging from 0 to 5. These “SAE levels” are widely used by industry and policymakers to provide a common international language for automated driving. These levels provide the context for our consultations.

LEVELS DEFINITION COMMENTS HUMAN DRIVER MONITORS THE DRIVING ENVIRONMENT Level 0 – No automation. The human driver performs all aspects of all Human Driver for all aspects of driving driving tasks, even when these are enhanced by warning or intervention systems. Level 1 – Driver assistance. The driver assistance features can carry Human Driver with system capability for steering out either the steering or acceleration/ and acceleration/deceleration in some driving deceleration. modes Level 2 – Partial automation. The driver assistance features can carry out Level 2 and below can be characterized as driver both steering and acceleration/deceleration. assistance: the automation is simply intended The driver is responsible for monitoring to assist a human driver, who remains fully the driving environment and must remain responsible for performing the driving task. engaged at all times. Level 0-2 are out of scope for our consultation. AUTOMATED DRIVING SYSTEM MONITORS THE DRIVING ENVIRONMENT Level 3 – Conditional automation. The driving automation features can perform The “fallback”-ready user must be receptive all driving tasks but a human “fallback”-ready to a handover request or to an evident system user is expected to respond appropriately to failure, but is not expected to monitor the driving “a request to intervene”, i.e. the vehicle will environment. request human intervention when deemed necessary, so a driver must be ready to intervene at all times. Level 4 – High automation. The driving automation features can perform Many operational proposals of Level 4 fleets all the driving tasks within their “operational involve Operators being replaced by a fleet design domain” (i.e., motorways only). They manager remotely monitoring and controlling are limited by different ‘driving modes’ where vehicles to navigate through restrictive driving they cannot operate autonomously, such as in modes. inclement weather, or on particular types of roads. Level 3 & 4 are within the scope for the purposes of our consultation. Level 5 – Full automation. Level 5 vehicles can be considered There is skepticism towards whether it can autonomous rather than automated, as there actually be achieved or is just a theoretical are no driving modes they cannot perform in, concept paralleling artificial intelligence. and human input will never be needed, even remotely. Level 5 is out of scope for the purposes of our consultation.

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Our consultation relates to SAE Levels 3 and 4 within the Weather Conditions following framework: Fog, heavy precipitation, snow accumulation, icy surfaces, salt 1. A vehicle which “drives itself” within an operational design spray, blowing leaves, etc. domain, only being limited by different driving modes. 2. “User-in-charge” - where a vehicle is listed as capable of safely Driving Environment driving itself, and the automated driving system is correctly engaged, the human user would not be a driver. They would no • Recognition of pedestrian status (motion, motorized, walker, longer be responsible for the immediate driving task. However, wheelchair, dog-assisted, etc.) limited also by software inability a human may still be called on to drive in certain circumstances. to anticipate intent or interpret behaviour. We refer to this person as the “user-in-charge”. The main • Unpredictable cyclists, skateboarders, rollerblades, etc. role of the “user-in-charge” would be to take over in planned • Animal recognition and hazard level. circumstances or after the vehicle has achieved a minimal risk • Malfunctioning traffic lights, and right-of-way decisions. condition and come to a stop. • Hand signals (police-directed traffic, flag men, flagging riders, 3. A “fallback”-ready user – when operating at conditional etc.) automation, an AV is not designed to bring the vehicle to a safe • Avoidance of emergency vehicles in response mode. stop when it encounters a system failure or reaches the limits of its operational design domain. At conditional automation a • Temporary/emergency barriers and detours. human (“fallback”-ready user) must take over driving in these • Hazardous road conditions (significant potholes, tree branches, circumstances. The requirement for a “fallback”-ready user debris, etc.) distinguishes vehicles operating at conditional automation from vehicles operating at high or full automation, where the AVs can bring the vehicle to a safe stop. Rider Management • Emergency medical/other assistance. • Rider conduct (harassment, violence, vandalism, CONSIDERATIONS criminal acts, etc.) While we recognize that the future of AV technology is still • Technical uncertain, it is clear that significant resources are being invested • Accident management, emphasizing rider safety and welfare, of into the industry to achieve widespread adoption. Many all AV vehicle accidents. government agencies are beginning to take proactive approaches • Cybersecurity capable of preventing hacker exploitation of to managing AVs, further suggesting the likelihood of their systems. commercialization in the coming decade. The future of AV • Resolving expeditiously incidents of vehicle breakdown and/or transit vehicles specifically is further from the fore front of current systems failure. predictions, and even more uncertain, but unquestionably • A “Black Box” equivalent (quality and scope) vehicle/systems progressing. At present, private automated shuttles on streets make performance-monitoring system. up the majority of prototypes being developed.

The many uncertainties in the capabilities of the technology, As noted, the research indicates that the implementation of the cost, the restrictions, and the timing for companies to Level 3 and Level 4 AVs in the bus industry poses numerous develop a strategic plan and implementation currently provide challenges and would prompt changes throughout the industry. an opportunity for individuals impacted by AVs to share their views. It is evident in the research that the greatest challenge Reports summarizing consultation viewpoints will be facing commercial vehicle AV adoption is the need to reasonably published on our website periodically throughout the replicate, via “artificial intelligence”, selected human sensory and two-year period. decision-making processes. The magnitude of this challenge is illustrated by the following concerns:

19 MCPCC | LABOUR MARKET REPORTS 2019 BUSINESS & FINANCIAL

Driverless Shuttle Testing

City of Calgary introduces driverless shuttle Transdev introduces driverless to test autonomous vehicle technology shuttle in Montreal “ELA, or electronic autonomous”

RESEARCH FINDINGS

CURRENT STATE OF AVS the Autonomous Technology Program centered on “development and deployment of technology for Advanced Driver-Assistance The most controversial and uncertain element in AV discussion Systems (ADS) and Automated Vehicles (AV), with a guiding is when and how the vehicles will reach public roads, which is principle focused on public safety”. dependent on the capabilities of the technology, affordability and ownership models, restrictiveness of responding legislation, and public perception. Vehicles in level 0-2 are already commonplace City of Montreal Introduces Driverless Shuttle to Test and operate freely on . Level 3 and Level 4 Autonomous Vehicle Technology vehicles are currently being tested in designated areas. There is The announcement in May 2019 cited an exclusive partnership almost always a requirement for a driver to be present to take with the U.S. entity Robotic Research, with the stated objective control should the system fail. As an alternative the vehicles are of “advancing autonomous technology through developing and tested in designated lanes or areas with extremely low traffic. employing ADS in heavy-duty transit bus applications,” initially Google’s Waymo is currently testing Level 5 vehicles that do not directed to SAE Standard Level 4 criteria. need any method of driver control in a closed environment and has Also, in May 2019 NFI announced the acquisition of U.K. bus announced it will be expanding its Level 5 testing to public roads manufacturer Alexander Dennis Limited (ADL). “ADL is the UK’s after approval from State regulators soon. The vast majority predict leading bus manufacturer and the leading global manufacturer of the commercial arrival of AVs within the range of 2020-2025. double-deck buses, with an established international presence.” This range mirrors the dates several major auto manufacturers ADL’s current markets include the U.K./Europe, the Asia Pacific, have announced for their plan to complete development of either and to a lesser extent, North America; substantially expanding Level 3 or Level 4 technology, with only Volvo and Tesla projecting NFI’s global presence. Level 4 before 2020. Predictions for widespread adoption of AVs generally fall within the range of 2030-2040. The arrival of AVs Additionally, and significantly, ADL is the manufacturer of a U.K. within transit networks is a largely unprecedented subject with very prototype for a 42-passenger single-deck autonomous coach now little evidence for a meaningful prediction to be made, but it can undergoing trials to enable compliance to SAE Level 4 Standards. be assumed that it will closely follow that of personal AVs. The advanced stage of this project should substantially contribute to the progress of NFI’s ambitions relative to autonomous-bus Automated Bus Preparedness – NFI Group manufacturing and deployment/sales. Forecasting positively, it seems reasonable to assume that NFI could at an early date become NFI, recognized by the business community as “the largest bus the dominant autonomous-bus manufacturer in North America, manufacturer in North America” and “the Industry leader in zero and a major player elsewhere. emission electric bus deployments” has announced the launch of

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LIMITATIONS OF AVS • The Government of Canada has yet to release a policy for AVs, but it is possible that with the release from the US DOT, a While a key argument for AVs is that their ability to monitor their similar policy may be produced in Canada. environment surpasses what a human can detect, their ability to • As of 2019, 40 states and Washington D.C. have enacted understand complex situations is currently lacking. Most of the legislation or issued Executive Orders related to AV’s. The vehicles presently being tested simply come to a halt when an legislation in all states regulates the safe testing and deployment/ obstacle comes before them, but in the example of a piece of light operation of AV’s on public roads. plastic waste that has blown onto the road, abruptly stopping could be significantly less safe than colliding with the obstacle. This • The state of Michigan has passed four bills that together create a limitation encroaches on a key unknown of how AVs will weigh globally leading policy to further the adoption of AVs. The most factors in cost benefit analyses when a collision with one thing or differentiating component of these bills is that they allow for the another is unescapable. testing of AVs that are driverless or completely without a steering wheel and pedals. This is an unprecedented policy that removes A uniform challenge for AV manufacturers has been managing a lot of barriers to testing. Equally important is that the policy inclement weather, with snowy conditions being particularly is passed in the state of Michigan where the US car industry is disruptive to performance. Should this barrier not be addressed, concentrated. it would significantly limit the viability of AVs in Canadian • The City of Toronto currently has no official position or any climates. In a similar capacity, bright lights and reflective surfaces policies concerning AVs, but is currently directing an AV have been proven to be capable of disorienting an AV system, as working group to identify impacts that may necessitate new or demonstrated with a highly publicized crash of a Tesla vehicle on modified policies. auto pilot that failed to identify a white truck in its path.

AV technology to date is associated with electrically powered AVS IN PUBLIC TRANSIT vehicles. In its current state of development if AV technology was While the contemporary image of an automated vehicle is typically to be deployed on buses this would require charging stations at a personal automobile, considerable industry efforts, as well as transit terminals. Electric bus technology has yet to reach a point government-funded research, for higher capacity AVs are being where a full day’s worth of revenue service could be achieved put forth. Transit agencies are refraining from working directly with a single charge. This requirement for recharging may result with automated vehicles, instead 3rd party pilots that supplement in increased operational cost and also additional run time/buses existing service are most commonly observed. Research into would need to offset the time required for charging. automated transit vehicles is still in its infancy, but a summary of available information follows below. AV LEGISLATION The majority of larger on-street AVs being developed and tested Being a new and unprecedented technology, AVs have largely are shuttles that can hold 10-12 people on average, and operate been unaddressed by legislative bodies. Policies that do exist occur at average speeds of 20-25 km/h. These shuttles are almost sporadically throughout North America and the rest of the world. exclusively electrically-powered with lithium batteries. Testing Below is a summary of key steps towards legislating AVs, both occurs mostly in low-traffic areas like business parks or university locally and abroad. campuses, on fixed routes of only a few kilometers. Most instances • On October 13, 2015, the Government of Ontario filed Reg. of testing require a driver to be present and monitoring the 306/15 under the Highway Traffic Act, permitting testing of system’s performance. Hailing has been tested in a variety of ways, AVs on select Ontario highways, provided applicants adhere including e-hailing through an app, connected stop infrastructure to all specifications and restrictions set out. This came into that signals the vehicle, stopping at every stop along the route, effect January 1, 2016, and the first large scale applicants were and Operator interpretation, but there is little data as to which approved in November of the same year. have proved effective. The Mercedes-Benz Future Bus is the only prominent example of a full-sized automated bus and has yet to • In September, 2016, the US Department of Transportation have had test data made public. Tesla, an industry leader of AVs, released a federal policy intended to accelerate the has announced plans to expand into public transit vehicles in implementation of AVs and provide common standards and future years. regulatory tools to be used at state level.

21 PART FOUR PUBLIC SECTOR INVESTMENT

URBAN TRANSIT

FEDERAL ALBERTA

Through the Public Transit Infrastructure Fund, Budget 2016 A recent announcement from the Government of Alberta finds focused on making immediate investments of $3.4 billion over $215 million invested in various transit projects across 17 three years, to upgrade and improve public transit systems across municipalities. $101.8 million of the $215 million investment will Canada. go towards the Calgary Metropolitan Region to fund the purchase of 15 new Vehicles and 52 compressed natural gas buses. To support the next phase of ambitious public transit projects, $95.4 million will go to funding transit projects in the Edmonton through Budget 2017 the Government committed to invest $25.3 Metropolitan Region, while the remaining $17.8 million will be billion over the next decade, including $5 billion invested by the dispersed throughout 15 different Albertan communities. Canada Infrastructure Bank. Over the first three years, $141.4 million worth of the grants will Through new bilateral agreements with provinces and territories, be funded through the Climate Leadership Plan. the Public Transit stream will provide provinces, territories and municipalities with funding to address the new construction, 43 expansion, and improvement and rehabilitation of public transit BRITISH COLUMBIA infrastructure, and active transportation projects. In 2016, the TransLink Board and Mayors’ Council approved the These investments will help to improve commutes, cut air Phase One Plan, which funded the first phase of transportation pollution, strengthen communities and grow Canada’s economy. improvements in a 10-Year Vision. The Phase One Plan included improvements to the transit system to reduce overcrowding and In addition to this funding a number of provinces have also increase service quality so that people could travel across the region committed significant resources. more quickly and conveniently. The Phase One Plan also provided new funding for roads, cycling, and walking infrastructure and project development for expansion.

Building on the success and momentum of the Phase One Plan, the TransLink Board and Mayors’ Council is proceeding with the Phase Two Plan, which funds the second phase of transportation improvements in the 10-Year Vision. The Phase Two Plan is an historic investment in transportation infrastructure and transit service in this region and will transform how people travel.

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2018 – 2027 Investment plan transit than they would without the Phase Two Plan investments. PART FOUR The Phase Two Plan funds the second phase of transportation 2017 Ridership actual 247.8 million improvements in the 10-Year Vision, including: 2018 Ridership forecast 251.7 million PUBLIC SECTOR INVESTMENT • Construction and operation of the Surrey-Newton-Guildford Line (Light Rail Transit) 2027 Ridership forecast without phase two 274.1 million • Construction and operation of the 2027 Ridership forecast with phase two 316.3 million Extension • Modernization of Expo-Millennium Line infrastructure, TransLink anticipates developing a Phase Three Plan in the coming including significant capacity and reliability upgrades to systems years, which would fund 10-Year Vision expansion projects for and stations, and additional SkyTrain cars for the Expo and the remaining years of 2022-2026. This would include all the Millennium lines to increase capacity and accommodate growth remaining bus, rail, walking, cycling, and road improvements in • Project development and potential early works for the the 10-Year Vision, including construction and operation of the Surrey-Langley Line (Light Rail Transit) Surrey-Langley Line. • A 7% increase in HandyDART service, 8% increase in bus service and 42% increase in rail service across the region ONTARIO • Two new B-Line routes, as well as transit priority and enhanced passenger amenities on other new B-Lines from the Ontario’s government announced a commitment to build better 10-Year Vision public transit and transportation infrastructure, deliver faster • New funding to municipalities for upgrades to walking and service – and put people first by making public transit an attractive, cycling infrastructure, such as sidewalks and bikeways affordable and low-stress alternative for individuals and families. The financial investment is estimated at $28.5 billion for various • New funding to municipalities for upgrades to major roads, projects throughout Ontario including four rapid transit projects including seismic upgrades in the Greater Toronto Area (GTA) making up $11.2 billion of the • Planning for a potential gondola to SFU Burnaby campus and total fund. rapid transit to UBC Point Grey campus These include: The Phase Two Plan includes funding from all levels of • A proposed new to help relieve overcrowding on government: federal, provincial, and regional. The Government the Yonge-University-Spadina Line in Toronto of Canada and Government of British Columbia have committed • Axtending the Yonge Subway Line to Richmond Hill and an unprecedented amount of funding to cost-share the new Markham and the Eglinton Crosstown Light Rail Transit transportation investments in the Phase Two Plan. Line further west into Etobicoke, as well as completing the Scarborough Subway Extension TransLink has requested: • Stage 2 of Ottawa’s Light Rail Transit project • $2.0 billion from the Government of Canada for the capital • Promoting economic development and meeting local costs of Phase Two projects, and transportation needs in the North by reviewing opportunities for • $2.5 billion from the Government of British Columbia for bus, passenger rail and rail freight services in Northern Ontario their commitment to contribute 40% of the capital costs of • Moving towards two-way, all-day service every 15 minutes on Phase Two projects. With the availability of this new federal core segments of the GO Transit rail network and provincial funding, the region has a chance to improve the transportation system at a significantly reduced burden • Improving service through the largest increase in GO Transit rail to local taxpayers. services in five years, including more trips per day, introducing route expansion and looking at the feasibility of providing flexible food and beverage services across the GO Transit rail As a result of the investments in the Phase Two Plan, transit network ridership is forecast to increase from 248 million journeys in 2017 • Allowing kids age 12 and under to travel free of charge on all to 316 million journeys in 2027. By 2027, people in the region GO Transit trains and buses. will make an estimated 42 million more journeys per year by

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QUEBEC from school. As of 2018, students are about 80 times more likely to get to school safely on a school bus than by car. PART FIVE The Coalition Avenir Québec (CAQ) was elected in October 2018. The highlights of the CAQ’s transportation plan included: Fatalities on school buses account for less than 0.1% of all motor • The extension of the Metro Blue line. vehicle-related fatalities in Canada. In the last decade, between RIDERSHIP AND SERVICE 2009 and 2018, there was 1 school bus passenger fatality on • The scrapping of plans for the Metro Pink line. Canadian roads. • The extension of the LRT to Chambly on the South Shore and to Laval, north of Montreal. Note: data were filtered to identify school-related purpose, i.e. • The introduction of tax incentives for carpooling. weekdays (Mon-Fri), school months (Sept-June), and school • The widening of Highway 30 to three lanes between Highways related hours. 10 and 20, for public transit. As of September 1st, 2020, a school bus equipped with seat belts will need to meet the technical requirements for installation under In June 2019, Montreal Mayor Valérie Plante struck a deal to the Motor Vehicle Safety Regulations and cannot be equipped with build the western portion of her promised Pink line, agreeing to lap belts only. transfer federal infrastructure money for ’s tramway in order to secure provincial support. She announced plans to build Funding Concerns a tramway line from downtown to Lachine, in the city’s west end. In exchange, Montreal will deliver $800 million to Quebec City, to While there is significant government support and funding for help pay for the provincial capital’s proposed $3.3-billion tramway changes to Canada’s public transit network, delivery of school bus network. The western portion of the Pink line will now be added services continues to lag behind in the level of required public to the government’s ten-year Quebec Infrastructure Plan (QIP). funding. The government has added $5 billion to the $110-billion QIP budget for 2020 to 2030. In Ontario, based on the industry’s recent financial report, the Ontario School Bus Association (OSBA) anticipates a $141 million annual funding gap arising from the minimum wage increase and SCHOOL BUS changing market conditions. If this funding gap is not addressed, According to the National Collision Database (NCDB) statistics, OSBA estimates further negative impacts on driver retention and 44 school buses are the safest means of transporting students to and operational effectiveness.

24 PART FIVE RIDERSHIP AND SERVICE

In 2017, more than 23 million Canadians lived in areas with Capital funding for Canada’s transit systems has also grown, transit service. In that year, transit ridership in Canada exceeded both to meet the need for repair and replacement of ageing 2.1 billion passenger trips, representing an average annual growth infrastructure and to make up for many years of underinvestment rate of 1.6% since 2008. In 2016, the Census found that 12.4% in transit expansion. Total capital investment in 2017 reached $8.1 of Canadian workers took transit to work, a significant increase billion, up from $4.2 billion in 2009 45. from levels in 2006 (11%) and 1996 (10.1%).

The availability of transit service has increased steadily across Canada in recent years, with the number of revenue vehicle hours growing at an annual average rate of 1.96% from 2008 to 2017.

FIGURE 3: RIDERSHIP TRENDS - REGULAR SERVICE

2.5 2.10 2.06 2.06 2.05 1.96 2.01 2.01 1.88 2.0 1.8 1.8 1.74

1.5

1.0

Annual Ridership Billions 0.5

0 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

*Only Transit systems who have recorded for the majority of the bench marking years have been included

Canadian conventional transit ridership continues to surpass services through in Montréal, Québec which accounts for 2 billion passenger trips. In 2017, 103 CUTA transit system approximately 20 million trips that were uncounted in the past. members reported 2.10 billion passenger trips which is an An analysis of normalized Canadian transit ridership data shows increase of more than 2.5% reported revenue passenger trips that Canadian ridership increased by approximately 1.5% from following a 5 year period of plateauing. 2017 marks the first year 2016 to 2017 alone. that CUTA received counts of ridership from metropolitan bus 25 MCPCC | LABOUR MARKET REPORTS 2019 BUSINESS & FINANCIAL

TRANSIT RIDERSHIP

2.15 PART SIX 2.10 2.00 EMPLOYMENT COSTS 1.95 1.90 1.85

(Billions) 1.80 1.75 1.70

Regular Service Passengers 1.65 2009 2011 2013 2015 2017

TRANSIT SERVICE PROVIDED

51 50 49 48 47 46 45

(Millions) 44 43 42

Revenue Vehicle Hours Revenue Vehicle 2009 2011 2013 2015 2017

TRANSIT CAPITAL EXPENDITURES

9.0 8.0 7.0

6.0 5.0

Value Value 4.0

($ Billons) 3.0 2.0 1.0 0 2009 2011 2013 2015 2017

26 PART SIX EMPLOYMENT COSTS

The breakdown of employees by position has remained consistent bus sector ($61,591) are compensated considerably more than since 2012. Overall, bus drivers make up 67% of employees. in other sectors, particularly relative to school and employee bus This is lowest in the urban bus sector (52%) and highest in the transportation employees ($25,897), however it should be noted school and employee bus sector (90%). On average, employees that the majority of school bus employees are part-time. in the urban transit sector ($101,351) and interurban and rural

6%

27%

67%

Bus Operators Mechanics/Maintenance Other

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BUS INDUSTRY EMPLOYMENT STATISTICS OVERALL AND BY SECTOR (2017)46 PART SEVEN Average Total # employees %Drivers %Mechanics %Other employees expenditure per employee LABOUR MARKET IMPACT Urban transit systems 61,528 52% 7% 41% $101,351

Interurban and rural bus 2,809 62% 9% 29% $61,591 transportation School and employee bus 42,033 90% 4% 6% $25,897 transportation Charter and sightseeing bus 6,004 60% 6% 34% $35,367 industries Other transit and ground 6,096 73% 2% 25% $44,169 passenger transportation

Total Bus industry (2017) 118,469 67% 6% 27% $67,351

28 PART SEVEN LABOUR MARKET IMPACT

AGEING WORKFORCE SUSTAINABILITY OF INTERURBAN AND RURAL BUS COMPANIES The ageing population will disproportionately affect the bus industry, where bus drivers make up 68% of the total workforce The interurban and rural bus sector has not been profitable since and have a median age of 51.7. It is projected that roughly 40% 2011 showing a net loss of $104M from 2008 to 2016. Losses in of the workforce will retire in the next 10 years, and while it is 2016 were the second highest during that period and at $24M it projected that supply will meet demand, fewer new drivers may represented 3.3% of total operating and non-operating revenue. put a strain on driver training programs. Over that same period, the number of companies shrank from 22 in 2012 to 13 in 2016.47

SCHOOL BUS RECRUITMENT There has since been contraction in one of Canada’s oldest operators. In 2018 declines in ridership led The school bus industry has been challenged in recruiting to cancel routes in nearly all of , as well as some and retaining bus operators. In Ontario, the province chose to in Ontario and Quebec.48 In British Columbia, some routes incentivize eligible school bus operators up to $3,000 in bonuses were preserved through $2M in interim funding and are being over periods spanning January 2018-June 2019. A total of $60M operated by BC Transit.49 Greyhound stated that ridership dropped funding went to the Ontario School Bus Association to administer 41% nationwide since 2010 and 8% in Western Canada alone the school bus driver retention bonus program. in 2017. They explained that the decline in ridership was due to increased car ownership, subsidies to competing passenger carriers, competition from low cost airlines and regulatory restrictions.

29 PART EIGHT CONCLUSION

This industry comprises establishments primarily engaged in These include but are not limited to: ground passenger transportation activities (such as urban transit • Ageing and/or inadequate fleets and related infrastructure systems, school, interurban and rural bus transportation). Transit • Automobile competitor dominance and ground passenger transportation accounted for only 20% of production but 37% of employment, making this segment the most • Funding inadequacies labour intensive. Transit and ground passenger transportation is also • New technology costs strongly influenced by the degree of urbanization and the associated • Prohibitive operating/capital costs escalation demand for public transit systems across major cities in Canada. • Declining student populations With the collapse of crude oil prices in 2014, fuel costs are projected • Increased safety and security issues including growing violence to remain low over the short- to medium-term, resulting in lower prices and/or higher profits in the industry. The substantial long-term government investment in urban transit infrastructure including the progressive upgrading of fleets, will Furthermore, the industry will continue to benefit from the gradual enable this sub-sector to provide a modern, accessible network displacement of the Canadian population toward urban centers of bus services to meet 21st century expectations/requirements. over the coming years, increasing the need to ease road congestion Development of quality partnerships with governments, other key with more public transit services. A desire to decrease emissions stakeholders and capital investors is also crucial to further success. and pollution is also expected to entice more commuters to use environmentally-friendly public transit systems. This demand The industry still has substantial work to do to overcome the should be met in part by major commuter-rail projects under negative public perception of bus and coach travel. It is therefore construction in Edmonton, Toronto and Ottawa. imperative that the industry is enabled to work in a stable and fiscally supportive legislative environment. Most important, that all The industry strives to improve its services so that growing stakeholders commit to delivering a high quality of transportation customer expectations are reasonably met in the areas of reliability, services that meet or exceed the legitimate needs and reasonable safety, comfort and affordability. This is seen by many industry expectations of the public which it serves. stakeholders as an exceptional challenge as they also must contend with a number of significant business and economic issues, some While the outlook for the bus industry labour market appears fairly beyond their operational control. stable through 2026, there are significant social and technological factors, in terms of an ageing workforce and AVs, respectively, which will likely cause significant change. These issues, in addition to the stability of the interurban and rural bus industry, the ongoing challenges of school bus companies recruiting drivers, and other emerging challenges will be explored over the coming months.

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ENDNOTES PART EIGHT 1. Labour Force Survey – Data Tables 26. TransLink. “TransLink launches new electric bus trial.” Accessed: February 2019, 2019. https://www.translink.ca/AboutUs/Media/2018/April/TransLink- 2. Job Vacancy Statistics – Data Tables launches-new-electric-bus-trial.aspx. 3. Survey of Employment, Payroll and Hours – Data Tables CONCLUSION 27. Société de transport de Montréal. Sustainable Development Plan 2025. 2017. 4. Job Vacancy and Wage Survey – Data Tables 28. Société de transport de Montréal. Rapport annuel 2017. 5. Employment Insurance Statistics – Data Tables 29. Toronto Transit Commission. TTC Green Initiatives. Accessed: 6. Table 14-10-0337-01 Employment insurance beneficiaries (regular benefits) February 25, 2019. https://www.ttc.ca/Riding_the_TTC/green_ initiatives.jsp. by province, territory and occupation, monthly, seasonally adjusted 30. Toronto Transit Commission. System Quick Facts. Accessed: February 25, 7. Statistics Canada. Table 23-10-0081-01 Financial performance of the 2019. https://www.ttc.ca/About_the_TTC/Operating_ Statistics/2017/ passenger bus and urban transit industries, by industry sectionone.jsp. 8. Statistics Canada. Table 23-10-0088-01 Canadian passenger bus and urban 31. The City of Edmonton. Edmonton’s Transit Strategy. July 2017. transit industries, revenue, selected provinces and regions 32. . ETS Statistics for 2017-2019. Accessed: February 9. Statistics Canada. Table 23-10-0085-01 Canadian passenger bus and urban 25, 2019. https://www.edmonton.ca/ets/etsstatistics.aspx transit industries, operating revenue, by Industry (x 1,000) 33. Renewable Cities. “TransLink, Metro Vancouver’s transit operator, sets a 10. Statistics Canada. Table 23-10-0082-01 Canadian passenger bus and urban 100% renewable energy target.” Accessed: February 25, 2019. https://www. transit industries, capital expenditures, by industry (x 1,000) renewablecities.ca/newsupdates/translink-sets-100-renewable-energy-target. 11. Statistics Canada. Table 23-10-0086-01 Canadian passenger bus and urban 34. TransLink. Fleet and Technologies. Accessed: February 25,2019. https://www. transit industries, equipment operated, by industry and type of vehicle translink.ca/About-Us/Corporate-Overview/Operating-Companies/CMBC/ Fleet-and-Technologies.aspx. 12. Statistics Canada. Table 23-10-0084-01 Canadian passenger bus and urban transit industries, fuel consumption, by industry (x 1,000) 35. Lion Electric Company. Accessed February 2019. https://thelionelectric.com/ en. 13. Statistics Canada. Table 23-10-0087-01 Canadian passenger bus and urban transit industries, maintenance cost, by type of vehicle 36. New Flyer Industries. About New Flyer. Accessed: February 2019. https:// www.newflyer.com/company/about/. 14. Statistics Canada. Table 23-10-0083-01 Canadian passenger bus and urban transit industries, employment and compensation, by industry 37. Nova Bus. Accessed: February 2019. http://novabus.com/. 15. Statistics Canada. Table 23-10-0078-01 Large urban transit statistics, 38. GreenPower Motor Company. Accessed: February 2019. revenue and passenger trips based on 10 major Canadian urban transit https://www.greenpowerbus.com/. operators (x 1,000,000) 39. Autonomous Vehicles and the Future of Work in Canada. Information and 16. ESDC – Canadian Occupational Projection System Communications Technology Council (ICTC). Ottawa,Canada) 17. Bloomberg New Energy Finance. “The Electric Vehicle Outlook” 2019, 40. Law Commission London England 2019 “Electric Buses in Cities Driving Towards Cleaner Air and Lower CO2” March 41. Implications of Automated Vehicles for TTC 2018 42. NFI Press Releases 18. Poon, Linda. “How China Took Charge of the Electric Bus Revolution.” City Lab. May 8, 2018. 43. Phase 2 Ten Year Vision 2018-2027 Investment Plan June 28, 2018 19. Société de transport de Montréal. “STM orders four new fast charging electric 44. A new vision for student transportation April 2018 buses.” September 17, 2018. 45. CUTA 2017 Canadian Conventional Transit Statistics 20. New Flyer Industries. “Toronto Transit Commission orders up to 40 battery- 46. Statistics Canada. Table 23-10-0083-01 Canadian passenger bus and urban electric buses from New Flyer.” Accessed: February 25, 2019. https://www. transit industries, employment and compensation, by industry newflyer.com/2018/06/toronto-transitcommission-orders-up-to-40-battery- electric-buses-from-new-flyer/. 47. https://www150.statcan.gc.ca/t1/tbl1/en/cv.action?pid=2310008101 21. Leary, Rick and Case, Bem. TTC 2018-2040 Green Bus Technology Plan. 48. https://www.theglobeandmail.com/canada/article-greyhound-cancels-most- November 2017. routes-in-western-canada/ 22. Toronto Transit Commission. TTC Green Initiatives. Accessed: February 25, 49. https://www.theglobeandmail.com/canada/british-columbia/article-new-bus- 2019. https://www.ttc.ca/Riding_the_TTC/green_ initiatives.jsp. service-in-northern-bc-willhelp-fill-gaps-left-by-greyhound/ 23. The City of Edmonton. “Electric Buses Make Edmonton a Canadian leader.” 50. Clean Energy Canada, “Will Canada Miss the Bus”. March 2019 https://www.edmonton.ca/projects_plans/ transit/electric-buses.aspx. Accessed: February 25, 2019. 24. Marcon for the City of Edmonton. Electric Bus Feasibility Study. June 2016. 25. TransLink. Fleet and Technologies. Accessed: February 25, 2019. https://www. translink.ca/About-Us/Corporate-Overview/ Operating-Companies/CMBC/ Fleet-and-Technologies.aspx.

31