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Vancouver Sun: Real estate 'headwinds' could slow retail, construction sales: BCBC

The province’s economy, which enjoyed a robust year in 2017, is expected to downshift in 2018, according to the Business Council of B.C.

The residential real estate industry has driven so much growth across the B.C. economy in recent years. Now, with so-called “policy headwinds” in sight, there will also likely be an accompanying impact on retail sales and construction, says BCBC chief economist Ken Peacock, whose group analyzes economic prosperity and competitiveness.

Total retail spending in B.C. was up nearly 10 per cent in 2017. In particular, sales at building material stores were up nearly 30 per cent in the second and third quarters of 2017. Automobile retailers posted an annualized gain of more than 25 per cent in the third quarter.

“The steady inflow of foreign money and wealthy immigrants are factors, but so is the broader wealth effect from soaring real estate values as more B.C. homeowners tap into their home equity to help finance renovations and other large purchases,” wrote Peacock.

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Radio NL: The Business Council of B.C. wants the NDP Government to tread carefully when raising the minimum wage

The BC Business council is recommending the NDP government go it slow on hiking the minimum wage.

Executive Vice President Jock Finlayson is recommending a measured incremental approach.

Finlayson says, BCBC wants a hike in the minimum wage to 15 dollars an hour in five years, but doesn’t offer any specifics.

“We are at $11.35 an hour at the moment in B.C. We said moving to $15.00 should be done over the sort over the 2021-2022 period, in a series of modest steps. One thing we don’t want to see is a replication in British Columbia of what Ontario is doing. Ontario is taking a very dramatic jump from $11.35 an hour to $14.00 an hour in just one year”

Finlayson told the Fair Wage Commission a few years of modest and predictable step by step increases will give employers and the labour market time to adjust and limit harmful consequences.

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BIV: New year starts with tax breaks for B.C. businesses

[Excerpt] Jock Finlayson, chief policy officer for the Business Council of British Columbia, has calculated the total costs to business of various taxes and fees, as well as the breaks they will get, for fiscal 2018-19.

He thinks that, overall, businesses will be in a slightly better position in 2018, with respect to fees and taxes, although that advantage is likely to be short-lived.

In 2018, bigger businesses will pay a 1% increase in corporate taxes – $306 million in total. On the other hand, small business in B.C. will pay $81 million less from a 0.5% reduction in the small-business tax rate.

Finlayson calculates the carbon tax increase will cost British Columbians $212 million, about half of which will be paid by business. On the other hand, a 50% reduction in PST on electricity sales will save business $82 million.

The biggest item, however, is MSP premium cuts. The 50% reduction will cost the government $1.24 billion.

“It’s clear that a substantial chunk of this $1.24 billion of MSP premium reduction will, in the first instance, accrue to employers – I would think at least half of it,” Finlayson said. “In net terms, there’s going to be, for employers in general, a cost saving in 2018-19, as a result of the combination of measures that were announced in the September 2017 budget update. How it plays out will vary by industry and by company. It’s a bit hard to generalize, but for business in aggregate, I would estimate some sort of net cost saving in 2018-19.”

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BIV on Roundhouse December 20: 2017's biggest stories in VR, finance and the economy

Ken Peacock from the Business Council of B.C. recaps the biggest events that shaped the B.C. and Canadian economies in 2017. [13:43]

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Business in Vancouver: Outlook 2018: Tempered expectations for B.C. in 2018

Amid heightened global uncertainty, a severe commodities slump and acute affordability challenges in the Lower Mainland, British Columbia’s economy hasn’t just made it through the last several years – it has thrived.

“The last three or four years from a macroeconomic point of view really have been the best of times,” explained Jock Finlayson, executive vice-president and chief policy officer of the Business Council of British Columbia (BCBC).

Commodity markets improved “dramatically” in 2017, B.C.’s population grew and employment is poised to expand by 3.5%. Even with two interest rate hikes from the Bank of Canada, the cost of money remains highly attractive, and historically low. The BCBC’s latest economic review and outlook also cites a booming tourism sector, “robust” consumer spending and rising incomes as contributing factors to B.C.’s impressive economic growth.

“We know there’s been well over $100 billion of gains and net worth for households in the Lower Mainland, for example, in the last four years,” Finlayson said. “And some of that is being spent in the consumer retail marketplace.” 

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In 2018, the BCBC, RBC and other institutions are tempering their expectations.

“It’s an economy coming off the boil a bit,” Finlayson said. “We’ve been growing above potential.”

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Maclean's: The 91 most important economic charts to watch in 2018

"Trends in interprovincial migration reflect differences in economic growth rates and job opportunities across the country, as well as the locational choices made by post-secondary students and retirees. The accompanying chart, spanning the years 2012-2016, shows cumulative two-way migration flows between various provincial pairs.

 - Jock Finlayson, Executive Vice President & Chief Policy Officer, Business Council of British Columbia

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Vancouver Sun, Vaughn Palmer: Budget surplus shrinking as NDP makes good on spending promises

[Except] Overall James professes optimism regarding the coming provincial budget.

“The private sector is expecting that B.C. is going to be among the top performers in economic growth this year and next year,” she said, quoting the favourable forecast from the B.C. Business Council among others.

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Globe and Mail: B.C. Finance Minister Carole James upbeat on province’s budget

[Excerpt] Economist Jock Finlayson of the Business Council of B.C. said the Finance Minister is keeping appropriate levels of prudence in this budget. But he is hoping she will reconsider plans that call for smaller revenue cushions in the coming years.

"The real question is around the following two years – and the extent to which the provincial economy experiences slower growth," he said.

The Finance Ministry expects the economy to grow by roughly 2 per cent in each of the following years, a forecast Mr. Finlayson described as conservative.

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Comox Valley Record: Jock Finlayson named 2018 Comox Valley Walk of Achievement recipient

The Comox Valley Walk of Achievement has named Jock A. Finlayson as its latest inductee.

Each year, the Comox Valley Walk of Achievement honours a worthy past or present Comox Valley citizen who has achieved distinction in their field of endeavour. The induction includes a recognition ceremony, followed by the unveiling of a personal plaque located on a sidewalk location in downtown Courtenay.

Jock Finlayson will be officially inducted as the 2018 Walk of Achievement on Saturday, Nov. 25 at noon, in the Sid Williams Theatre foyer.

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Comox Valley Now: Latest Walk of Achievement Inductee Announced

A Comox native is being honoured this weekend.

Jock A. Finlayson is being inducted into the Comox Valley Walk of Achievement.

The Executive Vice President and Chief Policy Officer of the Business Council of British Columbia was born at St. Joseph’s Hospital and grew up in the region, attending Courtenay Elementary, Lake Trail Junior High and G.P. Vanier.

As a young man, he worked at the Elk Falls Pulp Mill in Campbell River. Over the years, he’s written two books and has done important work in the world of economics.

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BIV on Roundhouse November 22: Economist Jock Finlayson discusses B.C.'s economic performance

Economist Jock Finlayson from the Business Council of B.C. explains why we should expect the province’s strong economy to downshift next next year. [18:12]

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Vancouver Sun: Washington state governor calls for high-speed rail to Vancouver

[Excerpt] B.C.’s business community reacted positively to the news. Greg D’Avignon, president of the B.C. Business Council, said that although more work has to be done on studying the project, it could help alleviate congestion and barriers to growth between the two neighbours.

“While the council waits to see the results of the Washington state study to understand the economic and financial impact, we believe high-speed rail between Vancouver and Seattle has the potential to be a strategically significant infrastructure project connecting the Cascadia Innovation Corridor,”D’Avignon said in a statement.

“It would also allow for greater regional opportunities in tourism, and growth in the exports of services and goods. It would also provide a competitive advantage in attracting global talent who are looking to live and work in innovative, thriving economies with efficient transportation networks.”

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Globe and Mail: On Hydro, B.C. Premier John Horgan borrows a trick from the Liberal repertoire

[Excerpt] Economist Jock Finlayson of the Business Council of B.C. grudgingly supports the continued construction of Site C, and he blames the former Liberal government for allowing Hydro's finances to decline. But he said the current government is going to have to face up to the need for rate hikes.

"The reality is, the cost of power is going to be going up in British Columbia, Site C or no Site C. All you have to do is look at Hydro's balance sheet to understand why," he said in an interview. "It's a huge dilemma for our elected officials, because they know the public doesn't want to hear that – a lot of my members don't want to hear that, to be candid."

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Globe and Mail: B.C. business group hikes 2017 outlook for second time this year

British Columbia's economy continues to grow faster than expected this year, the province's largest business organization says, with strong job growth, substantial increases in consumer spending, rising exports and booming tourism.

It is the second time the Business Council of B.C. has revised upward its economic forecast for 2017 – it now projects 3.1 per cent growth for the year. That continued buoyancy was also recognized on Thursday by the bond rating agency Standard & Poors, which confirmed the provincial government's coveted triple-A credit rating.

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Economist Jock Finlayson, co-author of the business council's report, said in an interview the province is enjoying "a nice tailwind" from low interest rates and a weak Canadian dollar.
 

The rosy fiscal and economic news was welcomed by Finance Minister Carole James. "Confirmation of our 'AAA' credit rating shows that British Columbia's economic performance is strong and that we are on a fiscally sustainable path forward," Ms. James said in a statement. "We will continue to take concrete steps to ensure the fiscal well-being of British Columbia both today and into the future."

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However, Mr. Finlayson said it will be more revealing to measure the government's fiscal record after Ms. James delivers her first full budget next February. And, he said, the positive economic news may be a coincidence rather than a reflection of this government.

"It's way too early to start attributing either the positive or negative trends we see in the B.C. economy to the work of government," he said, adding: "Most of what happens in the economy isn't driven by government anyway."

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Business in Vancouver: Americans beating B.C. firms to punch in enterprise expansion

The fifth annual summit, presented by the Business Council of BC (BCBC), aimed to address how B.C. companies expand in a province reliant on a disproportionately significant number of small businesses.

A new BCBC report presented by economists Jock Finlayson and Ken Peacock highlighted that the province is home to 7,900 businesses employing 50 or more people compared with 396,000 enterprises that qualify as small businesses.

Last year, according to the report, the province had 83.4 small businesses per 1,000 persons compared with the national benchmark of 69.9.

Finlayson and Peacock argued that a higher number of large businesses in B.C. would boost compensation, increase productivity and expand international trade.

“We believe the paucity of larger enterprises is an impediment to building globally competitive industry clusters in B.C. – and to developing a more innovative economy generally,” the BCBC report stated.

The report recommended that policy-makers reduce basic corporate income tax to encourage the growth of small businesses, introduce tax incentives to businesses that make investments to expand and adjust research and development support to boost growth.

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BC Business Magazine: How will business fare with the NDP back at the helm?

Jock Finlayson, chief policy officer of the Business Council of British Columbia, shares Clark’s equanimity. “I’m relatively sanguine,” Finlayson says. “We know the premier [John Horgan] and his key ministers reasonably well,” having kept the lines of communication open, before and since the election. “We’re not expecting the province to go off the rails or for there to be a particularly acrimonious relationship.”

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BIV on Roundhouse October 27: Jock Finlayson on Federal Fall Economic Statement

On the latest show, Jock Finlayson of the Business Council of B.C. discusses the implications of this week’s big economic new, including the government’s plans to shrink the federal deficit. 

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News 1130: Prominent BC business leader worried over future of NAFTA

Hope is fading whether Canada’s strongest trade agreement with the United States can be renewed.

A prominent business leader in BC is expecting the next round of NAFTA talks to be contentious.

Jock Finlayson, who’s the Chief Policy Officer with the Business Council of BC, says much has changed since negotiations aimed at simply modernizing the 23-year-old deal started.

“We thought there was a sort of good faith effort. Increasingly it appears the Americans are actually looking for a reason to put a bullet into NAFTA –at least President Trump is anyway. Negotiations so far do not appear to be going very well.”

The fourth round of talks ended with fears of a complete withdrawal by the United States and Finlayson admits he’s worried because that country is still our biggest trade partner.

“Prospects are not looking very rosy at the moment.”

 

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Business in Vancouver: Federal deficit to be lower, thanks to strong growth

The federal deficit will be about $9 billion lower than expected, thanks to a windfall from strong economic growth.

In a fall economic update, federal finance Minister Bill Morneau announced October 24 that the deficit, originally projected to be $29 billion, will come in at $20 billion.

The Canadian economy has been growing at 3.7%, which, for Canada is “absolutely white hot,” said Jock Finlayson, chief policy officer for the Business Council of British Columbia (BCBC).

It’s also unsustainable, and expectations are that economic growth will cool to a more normal level of about 2% next year.

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News 1130: Liberals announce huge drop in federal deficit and a lot more spending to come

[Excerpt] Jock Finlayson with the Business Council of British Columbia says this is a sign Canada’s economy is performing much better than expected, but he’s worried about what happens if NAFTA trade talks fail and not enough money is dedicated to further reducing this country’s debt.

“Well, the next recession could be just around the corner. When the economy is doing quite well as we are at the moment, there’s an argument for moving more quickly to get back into a balanced budget –if not a surplus– and the Trudeau government is moving in that direction, but they’re doing it, really, with baby steps.”

He adds the danger with the government spending more is the Bank of Canada will feel pressure to keep raising interest rates, which is bad news for anyone trying to buy a home in BC.

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