As trusted economists and policy advisors to business and government leaders, the Council relies on sound, evidence-based analysis to inform its policy recommendations. Through diligent tracking of BC’s economic performance, we help identify the opportunities and challenges the province must navigate in order to reach its full potential.
Peacock Op-ed: B.C.'s Comparatively Good Economic Performance Should Not Foster Complacency (Surrey Business News)
The provincial economy is in good shape, supported by gains in parts of the export sector, impressive job growth, robust consumer spending and a booming housing market. In fact, B.C. is positioned to outpace all provinces in economic growth this year, and perhaps in 2017 as well. While this is an enviable position to be in, it should not breed complacency. Policy makers need to pay attention to competitiveness and step up efforts to make B.C. an attractive place for companies to invest and create well-paying jobs.
One reason for staying cautious is because B.C.’s ascent to the top of the provincial growth rankings is partly explained by the fact that Canada’s previous growth stars – Alberta, Saskatchewan and Newfoundland – have all been hit hard by the collapse in oil prices. Although B.C. is set to lead the country, we will do so with a very typical or average rate of economic growth compared to what the province has experienced over the past two decades.
Finlayson & Peacock Op-Ed: B.C.’s economic buffer in the energy downturn: real estate (Business in Vancouver)
BC’s economy looks to be in decent shape. The province led the country in economic growth last year and will likely do so again in 2016. In the U.S., just six of the 50 states exceeded B.C.’s 3% GDP growth rate in 2015.
So why is our province faring so well? One reason is that we don’t produce much oil and so have avoided the worst fallout from the worldwide oil price collapse. The weaker Canadian dollar has also helped. Non-resource manufacturing, high technology goods and services, agricultural products, tourism, and film and television production have all enjoyed hefty gains, in part because a feebler Canadian dollar makes them more competitive in the North American market. But other provinces also benefit from a cheaper currency.
In fact, much of B.C.’s recent success reflects the unusual strength of the domestic economy. And supported by record low mortgage rates and steady inflows of migrants and wealth from outside our borders, the residential housing complex has had a starring role in B.C.’s robust domestic economy, via new home construction, high levels of renovation spending and escalating home prices.
Growing More Significant-Scale Firms: An Important Innovation Goal for BC
In our new paper, “Innovation for Jobs and Productivity,” the Business Council argues that innovation is the key to creating and sustaining more high-productivity, high-wage jobs in the province.
New Regional Effort Aims to Establish Cascadia Innovation Corridor
British Columbia and Washington leaders come together to strengthen collaboration, create cross-border opportunity
Innovation for Jobs and Productivity:
Fostering High-Growth BC Businesses, Creating More High-Paying Jobs
How can British Columbia draw on its strengths to build a vibrant, diverse economy, one that produces rewarding employment opportunities and rising incomes for the people who work and do business here? Scholars and leading international organizations agree that the best route to sustained prosperity is by developing a highly productive economy.
PRESENTATION: Aboriginal Economic Development & Prosperity Forum
Our Economic Prospects in a Slow-Growth World as presented by Jock Finlayson and Ken Peacock at the Aboriginal Economic Development and Prosperity Forum.
Business Council of BC and the BC Assembly of First Nations sign historic Memorandum of Understanding
British Columbia’s business and First Nations leadership have signed a landmark agreement to ensure all BC residents share in the prosperity generated by sustainable economic development. The Memorandum of Understanding between the British Columbia Assembly of First Nations (BCAFN) and the Business Council of British Columbia (BCBC) will bring greater certainty for business to invest and operate and, of utmost importance, opportunity for First Nations to be full participants in the economic future of the province. It is believed to be the first agreement of its kind between a broad business organization and a provincial First Nations organization.
Finlayson Op-Ed: How Canada can put its economy back in gear (Troy Media & The Province Newspaper)
“Building an economy that works for the middle class” is the preferred mantra of the Trudeau government now ensconced in Ottawa. Rarely these days does one encounter a federal government news release that fails to tout the benefits of a thriving middle class. The term “middle class” itself, however, is never defined, making it difficult to know if progress is being made in delivering on what the government describes as its most important objective.
On at least some measures, the middle class in Canada actually looks to be doing reasonably well. Take incomes, for example. From 2010 to 2014, the total pre-tax income of the typical family – defined, statistically, as the “median” family consisting of two or more related persons – rose from $80,900 to $87,000, in constant 2014 dollars. This amounts to an increase (after inflation) of 7.5 per cent over four years – a decent gain.
RELEASE: BC can maintain climate leadership position while enhancing our economic competitiveness
The Business Council of British Columbia today released the following statement from Greg D’Avignon, president and chief executive officer and Jock Finlayson, executive vice president and chief policy officer, in response to the provincial government’s new Climate Leadership Plan:
“The Business Council of British Columbia acknowledges the government’s efforts to use science- supported data and to consult a broad spectrum of interests in developing its updated climate plan, with the goal of ensuring that BC remains a climate policy leader in North America.
Finlayson& Peacock Op-Ed: 15% property transfer tax should not apply to non-Canadians who move to Metro Vancouver for bona fide employment reasons (Business in Vancouver)
The way the government designed its property transfer tax scheme means that it will impose a stiff financial penalty on foreigners who locate here to take jobs.
The Lower Mainland’s frothy housing market continues to attract a great deal of media and political attention. In late July, the B.C. government responded to mounting public anxiety over soaring housing prices by instituting a 15% property transfer tax (PTT) on “foreign” purchases of residential real estate in Metro Vancouver. This measure predictably has raised the ire of the real estate industry, in part because it has captured, unfairly in our view, many in-process transactions that pre-date the effective date of the tax.
It is unclear whether the higher PTT will dampen housing demand. Initial evidence does point to some slowdown in the pace of real estate activity. The fact that foreigners have been responsible for at least 10% of all residential property purchases in the Vancouver region suggests that the new tax should have some effect.
Some Musings on the Metro Vancouver Real Estate Market
How do people in the lower mainland manage amid sky-high housing prices?
Finlayson: Two reasons why average families in Vancouver can't afford housing (Troy Media)
Recent months have seen a politically charged debate over the causes and consequences of sky-high housing prices in Metro Vancouver. The pace of price increases has been unprecedented, particularly for detached homes, which in some parts of the region have more than doubled in value in five years.
No Surprise: The Residential Real Estate Complex a Big Economic Engine in BC
Real estate sales have been running at record levels across the lower mainland, and home prices are surging. In response to elevated demand, new home construction has jumped to its highest level since the early 1990s. Renovation spending has also been strong. Casual observation and “water cooler chatter” speak to widespread media and public interest in real estate generally -- and housing prices in particular. In this setting, it will not come as a surprise that the data tracking economic output by sector confirms that real estate-related activity has become a critical factor underpinning economic growth in the province.
BC's Economy Remains on Solid Growth Path Despite Muted Global Backdrop
Against the backdrop of a subdued global economy, British Columbia looks poised for healthy growth over 2016-17, continuing the pattern of last year. While parts of our economy will be held back by depressed prices for some key commodities, exports of non-resource goods together with many services – including tourism – are enjoying a lift from the low Canadian dollar. The province’s housing market also remains buoyant, supported by rock-bottom interest rates, better job growth and steady inflows of immigrants and foreign money.
Finlayson & Peacock Op-Ed: Business input vital to immigration system’s economic success (Business in Vancouver)
There are currently 4.7 million people living in B.C. Over the past 20 years, our population has risen by 908,000. Back in 1995, the population was growing at an annual rate of 2.8%, based on strong net interprovincial migration, international migration, and a relatively high rate of natural increase (births minus deaths). Now, the population is increasing by 1% annually, which is higher than the Canadian average but slower than in decades past.
In the next 20 years, our population is projected to expand by 1.14 million. Natural population growth dwindles after 2015 and approaches zero by 2030. At that point, B.C.’s population will be rising solely due to net in-migration from other provinces and countries. Of the two sources of in-migrants, international immigration will have a bigger role in determining B.C.’s demographic and economic future. Thus, it is more important than ever that immigration policy is aligned with our economic needs. Unfortunately, based on some initial actions by the Justin Trudeau government, it appears that economic considerations will carry less weight in immigration decisions.
Finlayson Op-Ed: Green energy future a long way off (Troy Media and The Province)
Some Canadian environmental groups claim the world is in the midst of a dramatic move toward carbon-free forms of energy. The implication is that Canada – one of the world’s largest producers of oil and natural gas – should quickly abandon the fossil fuel economy and quickly embrace renewable energy as the only pathway to a prosperous future.
Important shifts in energy production and consumption patterns are undoubtedly underway. However, the timing of any overall global energy revolution is likely to be considerably slower than many believe. Rising global energy demand, and the tens of trillions of dollars of embedded capital that underpin current energy production and consumption systems, are among the factors that stand in the way of rapid change.
Commissioned Paper: Fiscal Options for Building a Prosperous British Columbia - By Kevin Milligan
BCBC commissioned an independent review of the efficiency, effectiveness and fairness of British Columbia’s current tax system, and potential policy approaches to modernize the system in the context of today's economic realities. The Milligan paper notes that BC faces two key fiscal challenges: generating the government revenues needed to fund public programs and services going forward, and ensuring a healthy level of investment and business growth to sustain a strong economy.
Off to Work: Improving the School-to-Work Transition for Recent University Graduates
Human capital is maximized when a worker’s qualifications and skills match those required by their job. Delayed PSE school-to-work transitions may help to explain Canada’s lacklustre productivity growth.
Immigration and Economic Growth
The influx of new immigrants (+86,216) was the primary driver of population growth in the first quarter of 2016. Syrian refugees comprised a large proportion of the incoming immigrant flow. Notably, Canada has never before admitted as many immigrants within a single quarter.
D'Avignon Op-Ed: Trade deals, infrastructure, national climate framework key for B.C. business (The Hill Times)
Today, some 40 business, First Nations, and community leaders from British Columbia are in Ottawa. Here’s how we can work together with the federal government.