79 Shercom employees laid off in wake of California company's monopoly over Sask. tire recycling

Saskatoon tire processing company Shercom Industries has informed the Ministry of Labour Relations that it has to lay off 79 employees as of Dec. 2.

It's the latest news after Tire Stewardship of Saskatchewan (TSS), a non-profit organization overseen by the Ministry of Environment, awarded rights to recycle tires in the province to California-based company Crumb Rubber Manufacturing.

Shercom Industries said this has given the U.S. company a monopoly over Saskatchewan tire recycling and the Saskatoon business cannot compete, with Crumb Rubber Manufacturing collecting all scrap tires in Saskatchewan and sending the product out of province.    

That led to Shercom having to shut down its processing plant in May of last year. Now, it has to import its own crumb rubber from outside the province, which the CEO said leaves a much larger carbon footprint, among other drawbacks. 

"Shercom in the same time has had to import 28 million pounds of crumb rubber from B.C., Alberta and Ontario, while all the tires are leaving. The cost to the Saskatchewan economy — with the job losses — is going to be measured in millions of dollars per year on an annual basis for the foreseeable future," said Shercom President Shane Olson. 

At its peak in 2022, the former scrap tire recycler employed just over 140 people, he said. Now, approximately just 20 employees remain. 

"It's a huge cost to the economy, huge cost to the environment and, of course, a huge cost to the community because these people that are laid off, they're real people," Olson said.

"They are real people like you and I with kids, with rent or mortgage, with dreams, with hopes."

Olson said Crumb Rubber Manufacturing's monopoly over Saskatchewan tires has been a tough blow to Shercom, which he has seen as highly successful and environmentally conscious.

"Our business model was torpedoed and it was torpedoed by the very province that should have been supporting us," Olson said.

The Shercom president said all tire companies can apply for a license from the TSS, but Crumb Rubber Manufacturing did not. 

"Had [they] applied for the license, they would have had to enter Saskatchewan's marketplace and compete head to head for the tires. Had the TSS just remained administrative, we could have done something amazing together," said Olson.

"What they've got in exchange is they bought a bag of magic beans that didn't come with a goose that laid the golden egg. It just came with an ugly giant that has come and destroyed everything that the Saskatchewan people worked so hard to establish in tire recycling."

Olson said Shercom leaders are now trying to redirect the company, which works with companies all across the U.S. and Canada to install rubber paving. 

"Shercom is not insignificant. We have a presence across Canada, across North America. It's because we're one of the oldest tire recyclers. So there's options for Shercom."

On Thursday, Saskatchewan NDP Leader Carla Beck blamed Saskatchewan Party Leader Scott Moe's government for high unemployment numbers and making bad decisions for the economy.

"This is another instance of Scott Moe focused on his own priorities instead of the priorities of Saskatchewan people. One of those is ensuring we've got good jobs in this province," Beck said.

She said the California company should not have been awarded rights to recycle tires in Saskatchewan. She said those jobs should go to people in Saskatchewan. 

Also on Thursday, Moe said the province depends on the TSS to make those decisions. 

"The government's involvement is setting up that regulatory operational process for those tires to be recycled. And then we rely on an industry appointed board to make the decisions that they do," Moe said.

"And we're always going to have conversations with that industry and we feel they have a requirement to ensure that they have a robust recycling program in place here in the province."

Both Beck and Olson said they believe the provincial government can step in in situations like these, but is choosing not to.