Cost Competitiveness

Saskatoon is a global leader in business cost competitiveness, according to KPMG's 2006 guide to international business costs, Competitive Alternatives, an excellent tool for comparing cost effectiveness in major Canadian cities. KPMG rated Saskatoon at 92.8 overall, representing a 7.2 per cent cost advantage over the United States (U.S.=100.0).

Globally, Saskatoon achieved a significant ranking from KPMG and is one of only 17 Canadian cities featured in this comparison. Saskatoon ranks:

No. 1 in Midwest United States/Western Canada;
No. 8 in the entire world for overall cost competitiveness;
No. 1 in Midwest U.S./Western Canada in all three areas of research and development (biotechnology, clinical trials, and product testing);
No. 1 in Midwest U.S./Western Canada in five manufacturing categories;
No. 8 in the entire world for overall biotechnology cost competitiveness;
No. 12 in the entire world for cost competitiveness in Web and multimedia content development.

Business costs were studied across North America, Europe and Asia-Pacific. In the study, 95 global cities in nine countries were examined based on 27 location-sensitive cost factors, including labour, facilities, transportation, utilities and taxes.

Cost of Doing Business

Saskatoon's utility and tax rates are highly competitive and include preferential rates for manufacturers and processors. These preferential rates include the Manufacturing and Processing Profits Tax Reduction (reduction to as low as ten per cent on the income tax rate for processor profits), as well as the Manufacturing and Processing Investment Tax Credit (a refundable tax credit applied as a percentage of the total capital cost of eligible building, machinery and equipment purchases).

Other advantages to locating a company in Saskatoon include:

Saskatchewan has no health care premiums, which elsewhere could cost employers about $1,300 annually for each employee;
Saskatchewan also has no payroll tax, which in some other provinces is close to four per cent of wages and salaries.

The publicly funded health care system is an important factor in the low cost of living. Basic health care is provided to all, with optional and attractive extra benefit plans including dental, disability and drug plan coverage adding approximately three per cent to payroll costs, depending on the extent of coverage.