Wednesday, February 09, 2011

Enabling Economic Development in New Brunswick

Responding to David W. Campbell, this post, in which he refers to this column and asserts "We need a new approach – see the column for a few ideas."

Update: It looks like David W. Campbell has removed my reply from his post.

Update: my reply is back again.

There's actually just one central idea in the column. It is this:

"In my view, both the provincial and federal governments need to refocus their economic development efforts away from being primarily a source of capital (a kind of bank) for small- and medium-sized businesses and toward being enablers of a broader set of factors that will make New Brunswick a place where companies will be more likely to invest."

This is all very fine, and I support this as written. But as usual, we need to get to the specifics of the "broader set of factors" that will be enabled, and how they will be enabled.

To my observation, the most significant enablers have been infrastructure projects:
- creating the four-lane highway network in NB
- the bridge to PEI
- investment in the internet backbone
- Moncton airport development
- Port facilities (Cruise ship docks, harbour dredging in Sydney)

There have been some failures as well, the refurbishment of Point Lepreau being right up there among them.

We should be talking about what sort of infrastructure we should be pursuing and how to evaluate the economic activity and (government) return on the investment. Right now, these are talked about almost entirely as though they were expenses, which means they are the subject of government largess, and become the targets of companies wanting lower taxes.

We should be talking about the sorts of investments we can make as a province. Because we are a major enterprise, we do have access to capital, and can make strategic investments. Some areas of infrastructure investment include:
- energy investments, and especially in our wind capacity
- entertainment facilities, such as an events centre in Moncton
- additional internet and ICT infrastructure
- a rail link to NE U.S. (connecting the Noreaster to Via in Moncton)

Additionally significant enablers have been cooperative ventures between government and some partners. For example:
- City of Moncton attracting high-profile events (note that these also have an infrastructure spin-off)
- Development of the Cranberry farm with Ocean Spray
- Moncton Flight College

There have been some spectacular failures as well. For example:
- Bricklin

The risk of failure (and not the inherent betterness of small-scale or large scale enterprises) dictates that the size of the projects be such that governments can pursue several at once. This is simply a recognition that it is not wise to place all our bets on a single investment.

There's a much wider range of possibilities here. Some things that strike me as promising (at least for the Moncton area):
- wider investment in inland & salt-water fish farming
- projects combining medical services and ICTs - helath informatics
- destination resort capacity in Shediac, Hillsborough, Alma
- wood products and furniture (we should be building stuff with our forests, not pulping them)

At one time I would have wanted to see more projects involving high tech, knowledge economy, etc., but we do not have the labour force to support that. The development of local human capacity has to form the third pillar of an enablement strategy, without which we will not be able to attract and develop a workforce:
- hospitals and health care - there are structural issues in the NB system; we need to improve patient records, scheduling and planning, drop-in and storefront clinics, and wellness support.
- education - which is improving, but has suffered (c.f. Moncton High) from a woeful lack of investment; also needed are better adult learning opportunities, expansion of adult education and evening classes, online learning support and infrastructure, and daycare
- immigration and immigrant support - we do almost nothing to directly recruit people to the province; we should be actively recruiting (people who are not related to us), even to the point of managing our own immigration policy as Quebec does, and providing significant immigrant support (it is *much* more efficient to help an immigrant adapt than to grow and educate a child from birth)

Again, these are typically depicted as net expenses. This misapprehension should be corrected. Investment in these sectors is essential for several reasons:
- people won't move here if these are not well-supported; they want to raise their children in good systems, not poor ones (NB should be able to market itself as the place where you can move to to put your child in a "good school" without having to buy a home in Rockcliffe Park)
- we need to expand the knowledge and skills of the population that is already here, especially that part of the population currently working in unskilled occupations

Now - you may think these are all poor ideas, either individually or collectively. Not the point. What I would like to see is some discussion of an overall development plan that is *at least* to this level of detail. I am so tired of reading over and over an economic strategy consisting of lower taxes and handouts to Irving. There has to be more we can do, I know that the governments, past and future, have done this piecemeal, and we should put all of these on the table, debate the merits, and then make the investments.

Update

Commentary on Confusing urbanization and NB’s northern challenge


I also think that the statistics may be a bit misleading. Urban areas typically attract a ring of sub-urban rural population around them. Though defined as rural, they are an effect of urban development.

But the main point still holds. The growth of cities like Toronto, Calgary, Edmonton and Vancouver was not as a result of rural depopulation. They attract immigrants, become stronger in their own right, and actually feed development out into their rural hinterland.

So I am in agreement with the main argument of this column. New Brunswick needs to look hard at immigration per se, and *not* immigration as migration from rural to urban areas, and not even immigration as repatriation of people who have left the province. None of these will do anything to address the major economic issues of the province.

I remember my wife saying, after Katrina, that New Brunswick should have reached out to people from New Orleans, letting them know that there is a home here for them. When you look at other regions suffering natural and civil strife - Bangladesh, Sudan, etc. - there are people who would find New Brunswick a paradise. Why can't we create a subindustry in this province specifically designed to attract and adapt immigrants?

People always say, "well you need the jobs before people will immigrate." But the attraction of immigrates *creates* the environment in which these jobs can be created. With the *current* population, there is almost nothing that can be done to simply create jobs - your labour pool is effectively that 10 percent of NBers that are unemployed. Because, how attractive is NB to a company if, after it locates here, it has to somehow figure out how to *import* labour? Why not just locate where the people already are.

The immigration comes first. The jobs come later. That's why we have to talk about immigration in NB.

1 comment:

  1. You would like to see some discussion, or you would like to see some discussion from someone with a name? That's the way discourse had gone in this wonderful age of fast information...people still discriminate between names and ideas, even though they don't have to anymore.

    ReplyDelete

I welcome your comments - I'm really sorry about the moderation, but Google's filters are basically ineffective.