Cisco to Spend $4 Billion to Create 1,700 Jobs in Canada

The love affair between Cisco Systems and the nation of Canada got a little more serious today: They’re now going steady.

The networking giant announced plans to spend $4 billion over 10 years to boost the company’s operations in the Province of Ontario to 5,000 people by 2024, which would amount to an increase of about 1,700 jobs from current levels.

Cisco CEO John Chambers has been wooing Canada for about a year now. Last year, Chambers couldn’t stop gushing about how Canadian policymakers have made the region “the easiest place in the world to do business,” and that the U.S. could learn a thing or two from them.

It’s all part and parcel of Chambers’s long argument with the U.S. over the corporate tax rate. Cisco had about $48.2 billion in cash and short-term investments on its balance sheet as of the quarter ended Oct. 26. Chambers has long been a vocal critic of a U.S. policy that taxes corporate profits at 35 percent. Fiduciary responsibilities dictate that corporate CEOs keep the cash they generate overseas outside of U.S. jurisdiction.

The result is that they never bring that cash home, but instead buy non-U.S. companies, like Israel’s NDS, for which Cisco paid more than $5 billion last year. Or they staff up in places outside the U.S. where it makes sense to do so.

Indeed, there’s a lot to like about Canada. Corporate profits are taxed at 15 percent. The education system is solid. Everyone speaks English. And with its onetime technology star BlackBerry having slashed jobs in recent months, governments there were likely eager to roll out the red carpet for Cisco.

Adding 1,700 in Canada is probably not going to go over so well back home, though. In August, Cisco said that it would eliminate 4,000 jobs in what it called a “workforce rebalancing.” In March, it whacked 500 in what it called a “realignment.” In July of 2012, it cut 1,300, as part of what was described as a “fluid restructuring plan.” And in 2011, it kicked off a massive restructuring, pledging to cull 6,500, plus an additional 5,000 who were transferred to Foxconn as part of the sale of a set-top-box manufacturing unit.

Here’s the original announcement: