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Could security fears help bring back the lowly typewriter?

These are stories Report on Business is following Thursday, July 17, 2014.

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Remember the typewriter?
I was raised on a typewriter, first because my handwriting was horrible and my teachers wouldn't accept my written work, so my mom forced me to learn.

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Then, in journalism school, I was taught to go direct to the typewriter, with no written drafts. Later, of course, I graduated to a computer keyboard and then to a BlackBerry, though I admit to still have issues with a touchscreen.

So I chuckled when I read this week that German spooks are considering using manual typewriters to keep their top confidential information secret from American spies in the wake of the NSA scandal.

According to various reports, Patrick Sensburg, the German politician who's heading up a probe into allegations that NSA spied on Germans, including Chancellor Angela Merkel, was asked by a TV interviewer this week whether he was "considering typewriters" rather than electronic information such as e-mail.

"As a matter of fact, we have – and not electronic models either," he responded, according to the report in The Guardian.

"Yes, no joke," he added.

Apparently the Russians are thinking the same thing.

Mr. Sensburg's suggestion was immediately shot down by others in Germany, including one politician on the committee probing the spying, who said that "this call for mechanical typewriters is making our work sound ridiculous" and that "effective counter-espionage works digitally, too."

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Obviously the world isn't going to return to the manual typewriter, but the issue highlights the extreme angst over digital security and privacy in the wake of several high-profile hacks and the Edward Snowden affair.

Which is why, for example, BlackBerry Ltd. touts its highly-regarded security features.

Still, writing in The New York Times this week, Andrew Rosenthal noted that "obviously governments and security services have a special interest in protecting private documents, but maybe professionals will eventually follow their lead."

Microsoft slashes deep
Microsoft Corp. is cutting deep into its ranks, announcing plans to slash up to 18,000 jobs over the next year.

Today's announcement from the software giant follows its recent acquisition of the Nokia devices and services operations.

Of those positions, some 12,500 professional and factory will be cut "through synergies and strategic alignment" of the Nokia operation.

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Microsoft said it would take charges of $1.1-billion (U.S.) to $1.6-billion over the next four quarters.

"The first step to building the right organization for our ambitions is to realign our work force," chief executive officer Satya Nadella said in announcing his plans to cut 14 per cent of the company's ranks.

"With this in mind, we will begin to reduce the size of our overall workforce by up to 18,000 jobs in the next year," Mr. Nadella told employees in an e-mail.

"My promise to you is that we will go through this process in the most thoughtful and transparent way possible," he added.

"We will offer severance to all employees impacted by these changes, as well as job transition help in many locations, and everyone can expect to be treated with the respect they deserve for their contributions to this company "

Loblaw changes management
Galen G. Weston, scion of the family that controls Loblaw Cos. Ltd., is taking on another top position in a senior management shuffle announced today in the wake of the grocer's $12.4-billion acquisition of Shoppers Drug Mart this year.

Mr. Weston, who is executive chairman, is also taking on the role of president, responsible for executing the company's strategy that he has been shaping in his chairman's role, The Globe and Mail's Marina Strauss reports.

He is replacing Vicente Trius, who has been president's since August, 2011 and credited with improving the stores' food offerings. He is leaving the retailer on Thursday for family reasons to return to Brazil, the company said.

And Domenic Pilla, president of Shoppers whose acquisition closed in late March, is leaving the retailer at the end of the year.

The changes come in an intensely competitive grocery field, with giant U.S.-owned discounter Wal-Mart Canada Corp. aggressively expanding its food offerings while U.S. rival Target Corp. entered this country last year, with almost 130 stores today.

CPR posts gains
Canadian Pacific Railway Ltd. posted a 48-per-cent rise in second-quarter profit today, while revenue surged as it cleared a backlog of freight after a long winter.

The Calgary-based railway said profit climbed to $371-million, or $2.11 a share. Revenue was $1.68-million, a 12-per-cent increase from the year-earlier quarter, The Globe and Mail's Eric Atkins reports.

Analysts had been expecting a per-share profit of $2.09 and revenue of $1.65-billion.

CP and other large North American railways are expected to enjoy high traffic volumes this year, as they they clear the winter backlog of goods and benefit from a large grain harvest. However, higher costs due to increased congestion on the rails and longer stays at freight terminals are hurdles. The Chicago hub, in particular, is a chokepoint for rail traffic.

Job troubles
Almost six years after the collapse of Lehman Bros., the Canadian economy remains a troubled place.

And so, economists say, the Bank of Canada spent more time than normal yesterday in talking about jobs and wages.

As my colleague David Parkinson reports, Bank of Canada Governor Stephen Poloz noted the "serial disappointment" in the global economy as the central bank released its rate statement and monetary policy report yesterday.

The central bank trimmed its outlook for economic growth, and now predicts that Canada's economy won't be back at full capacity for about another two years.

"Among other notable items, the bank also devoted more than the usual amount of attention to the labour market (typically, the jobless rate is not even mentioned)," said chief economist Douglas Porter of BMO Nesbitt Burns.

Canada's unemployment rate now stands at 7.1 per cent, though the country did rebound faster on the jobs front than others did after the recession.

And, Mr. Porter pointed out, the central bank "made note" of a wider measure of unemployment that takes into account people working part-time but who want full-time jobs, and discouraged workers.

That rate is now above 10 per cent, and, said Mr. Porter, "the bank sees that as a sign of plentiful slack in the labour market."

Indeed, the central bank's monetary policy report cited the modest job creation over the last 12 months, and the impact on our paycheques.

"Over the past year, employment has been very weak, increasing on average by roughly 6,000 jobs per month, or less than half the rate that would be consistent with real GDP growing at potential," the Bank of Canada said.

"At around 7 per cent, the unemployment rate remains elevated and would have increased if not for the recent decline in the labour force participation of the prime-age group (25 to 54 years of age) from 86.6 per cent to 85.9 per cent over the past six months," it added in the monetary policy report.

"Such a decline in the participation rate is roughly equivalent to 100,000 fewer people. In addition, in looking across various age groups, the participation rate of youth remains particularly low relative to its pre-recession peak."

At the same time, this "continuing labour market slack is also reflected in subdued increases in wages."

An accompanying chart showed union wage settlements in both the public and private sector most recently between just above 1 per cent and shy of 2 per cent.

The wider measure of unemployment, said Mr. Porter, does "a decent job" of front-running wage growth by about 12 months.

"But note that even with the still plentiful slack, this … measure would point to faster wage growth (closer to 3 per cent) than recent trends (2 per cent)."

Almost 1.4 million Canadians can't find work, according to the traditional measure, 376,500 of them young people who are struggling with a jobless rate of 13.4 per cent.

Unemployment and pay levels, of course, are key to consumer spending. And Canada is hardly alone.

The United States, too, has seen only modest pay increases. And just yesterday, Britain also reported weak numbers.

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