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Economic Life

From: The Encyclopedia of Canada's Peoples/Channel Islanders/Yves Frenette

From their base in Newfoundland, Channel Islanders moved quickly into the Gulf of St Lawrence after Canada was definitively ceded to Britain in 1763, taking advantage of their knowledge of French to establish economic relations with the Acadian population. Jersey and Guernsey entrepreneurs set up shop in Labrador, Cape Breton, the Gaspé, and New Brunswick. Three brothers, Philip, Jacques (John), and Charles Robin, established Robin, Pipon and Company of Isle Madame in 1765 and John Robin and Company a little later. After initially employing seasonal fishers from Jersey, the Robin brothers quickly transformed their fishing station in Arichat, Cape Breton, into a sedentary fishery. In 1766 the youngest of the Robin brothers, Charles, explored Chaleur Bay and established trade relations with the Acadians and aboriginals who lived there, as well as with other merchants who had preceded him. Charles came back the next year and set up a small station on the sandbar at Paspébiac, which would become the company’s headquarters. In constant contact with Jersey and taking advantage of Channel Islanders’ long experience in the Newfoundland fisheries, the Robins reaped all the benefits that came from the establishment of permanent stations. Unlike their competitors, they could receive fish from local fishers early in the spring. The company sought to involve increasing numbers of fishers in this trade.

To a large extent, the Jersey system was based on the dependency of the client fishers, to whom the company provided merchandise on credit through the year; the fishers reimbursed the company with fish at the end of the season. The high price of the supplies meant that the value of the credit was greater than that of the fish, so that the fishers ended up in debt at the end of the season and were virtually forced to fish for the same company the next year. Indebtedness, however, did not always have negative consequences. The best producers were often the most indebted, and others never or almost never went into debt. There were even some places where the Channel Island firms were not able to make the inhabitants dependent: fishers worked for themselves and sold their catch to the merchant of their choice, without incurring obligations. And there was always competition in the form of coasting vessels that took clients away from the Channel Island entrepreneurs.

Firms from the Channel Islands, and especially from Jersey, dominated the maritime economy of the Gulf of St Lawrence in the nineteenth century. They operated in Newfoundland, in Cape Breton, in the Gaspé, in New Brunswick, on the lower north shore of the St Lawrence, and in Labrador. In all these areas, the fishery was based on the same system of keeping client fishers dependent through credit. Operating in so many fishing areas enhanced profitability as the firms could make up losses incurred in one region with profits earned in another. All in all, the Channel Island firms employed at least 4,000 people. A quarter of these were Channel Islanders, mostly from Jersey with a smaller number from Guernsey.

The companies’ main product was dried cod, although they also exported ancillary products where the opportunity and the need existed. The main markets were Italy, Spain, Portugal, Brazil, and the British West Indies, with cod from Atlantic Canada also being sold in the United States, in Jersey, in England, and on the home market. Having sold fish in these countries, the firms brought back other commodities – rum, sugar, molasses, fruit, salt, and fabricated goods – which they sold to the client fishers.

Charles Robin and Company was the firm with the most extensive interests in the Gulf of St Lawrence. From Paspébiac, its headquarters and main shipping port, it dealt with more client fishers than any of its competitors. In addition to its presence in the Gaspé, the firm had operations on the east coast of New Brunswick, in Cape Breton, and on the lower north shore of the St Lawrence. Its output of dried cod alone (the company also shipped other fish and oil) increased from 27,000 quintals (1.4 million kilograms) in 1828 to 57,000 quintals (2.9 million kilograms) in 1865, making it the largest fish exporter in Atlantic Canada. The company had a workforce of about 750 people, including some sixty clerks and artisans. In addition, import-export firms established by members of the Robin family helped Charles Robin and Company penetrate international markets. Thus, the company controlled all aspects of the dried cod trade, from financing and shipbuilding, through the catch, to sales. A number of other Channel Island entrepreneurs started out with Charles Robin and Company, notably William Fruing, who started his business in 1832, John LeBoutillier (1833), LeBoutillier Bros. (1838), and, later on, John Fauvel and John and Elias Collas.

In 1870 the Robin empire was capitalized at more than $1 million. However, like the other Channel Island companies, it would soon face major problems. It continued to operate with tried and true methods, but these methods were becoming a force of inertia in the changing world of the late nineteenth century. It stuck with a traditional labour-intensive fishery based on outdated techniques. The advent of the steamship and railway transport, which led to a revival of competition, also hurt the Channel Island firms. Import-export operations became less profitable. The difficulty of maintaining a balance between “good” and “bad” debts – not a new problem, but one that grew in proportion to the increase in competition – also contributed to the companies’ woes. The companies were afraid that their client fishers would leave them, and so they loaned money to insolvent individuals and increased the prices they paid producers while lowering consumer prices, all in an unfavourable international context.

In the late 1860s, the Labrador firms became the first to experience problems; they collapsed in 1873 in the wake of the failure of two Jersey banks, the Mercantile Bank and the Joint Stock Bank. In Newfoundland, the Jersey firms initiated a strategy of cutting back, but were still unable to survive. Another bank failure, that of the Jersey Commercial Bank in 1886, undermined the foundations of the Channel Island fishing companies in Atlantic Canada, and they vanished one by one. The largest ones, however, formed partnerships with Canadian interests. In 1904, after several reorganizations, Charles Robin and Company moved its head office from Jersey to Halifax, where it merged two years later with two other firms, A.G. Jones and A.H. Whitman, to form Robin, Jones and Whitman. From 1912 on, Robin, Jones and Whitman emphasized the retail side of its operations, and it established a department store chain. It declined over a period of seventy years, however, finally shutting down for good in the 1980s.

Observers have often noted the multiple business and family relations that the Jersey merchants maintained with one another, both in Jersey and in Canada. Thus, John LeBoutillier married the daughter of Philip Robin, Jr, Charles Robin’s nephew, and one of LeBoutillier’s sons married John Fauvel’s daughter. At the same time, however, old rivalries were brought over from the islands to the new world. The DeGruchy family, enemies of the Robins for many generations, was involved in a number of cod fishing operations in Newfoundland. The DeGruchys became the second-largest Channel Island firm in North America and even tried to compete with the Robins in the Gaspé. The animosity between these two giants was such that it is still enshrined in the collective memory in Jersey.