Trade, Productivity & Competitiveness
BC’s ability to adapt to a rapidly changing world economy will depend on how well we can find new ways of doing business, adopt new ideas and practices, and connect with new trading partners. The Council encourages public policies that support research and innovation, business practices that increase productivity, connections that open new trading opportunities, and processes to commercialize BC’s best research.
Finlayson Op-Ed: Get ready for the next big boom in U.S. housing (Financial Post)
One of the most striking economic developments in the United States since 2008 has been a pattern of generally depressed household formation. Households are created when young people leave the family nest, when new migrants arrive in a country (or a region), and when couples or roommates split (resulting in two households where one existed before). Deaths, the movement of the elderly into institutional care, population out-migration, and marriage are among the factors that cause the number of households to decline.
Household formation plays a central role in driving the demand for housing and other goods and services tied to the emergence of households – everything from furniture, carpets and cable and internet subscriptions to mortgage appraisals, home renovations, and cleaning and landscaping services.
Growth in the Economy = Women
Women make up half of the world’s population. Looking ahead, this means half of the potential global labour force consists of women. Potential is the key word. There are many barriers to full labour force participation by women, notably in emerging economies, but also to some extent in the advanced economies too. But suppose parity is possible. It could add a total of between $12 trillion and $28 trillion to global GDP by 2025. Over a 10 year period beginning in 2015, this would be equal to between $1.2 trillion and $2.8 trillion per year. Importantly, this “extra” economic growth would be on top of baseline forecast growth rates, which have been rather subdued of late.
Release: Business Council welcomes the conclusion of the Trans Pacific Partnership Negotiations
New opportunities for Canada's Gateway to the Asia Pacific
Vancouver, BC - British Columbia business leaders welcome the successful conclusion of the negotiations to establish the Trans-Pacific Partnership (TPP). Canada and 11 other Asia-Pacific nations have been working toward a TPP agreement for more than two years.
“Given British Columbia’s position as the country’s gateway to the Asia-Pacific, we recognize the importance of ensuring that Canada is part of this landmark trade and investment agreement with countries that collectively are home to more than 800 million people and generate $28 trillion in annual economic activity,” said Greg D’Avignon, President and Chief Executive Officer of the Business Council of British Columbia. “The Business Council believes the TPP will help the Canadian and the BC economies grow by removing tariffs and other barriers, enabling more of our export industries to build new business, and strengthening the position of Canadian companies in global supply chains encompassing commodities, manufactured goods, and tradable services.”
Winners and Losers from the Slumping Loonie...Through a British Columbia Lens
In the final months of 2012 the Canadian dollar was trading slightly above parity with the US greenback. Nearly three years later, one Canadian dollar is worth ~76 US cents. This marks an unprecedented depreciation of the Canadian currency – more than 25% in a bit less than three years. A decline of this speed and magnitude has significant economic implications.
Recent international trade numbers suggest some improvement in Canada's limping economy
Statistics Canada’s just released snapshot of Canada’s trade performance in June offers a hint that the much anticipated upturn in non-energy exports may finally be materializing.
Letter to the Honourable Ed Fast regarding Canada's Participation in the TPP
On July 28, 2015, Greg D'Avignon, President and CEO of the Business Council wrote to the Honourable Ed Fast, Minister of International Trade regarding Canada's participation in the Trans-Pacific Partnership multi-national trade agreement.
Finlayson Op-Ed: Planning Ahead for Ongoing Change? (PeopleTalk Magazine)
Most people are aware that the population in Canada and other western countries is aging, that longevity is increasing, and that the front-end of the large baby boom generation has started to retire. Fertility rates have also fallen, which means the future supply of workers will be under additional downward pressure even as the ranks of seniors swell. But how quickly will our population grow, and age, in the next 20 years? Will employers soon face a dramatic shortfall of working-age British Columbians?
Finlayson Op-Ed: Canada flirting with recession (Troy Media, Business in Vancouver)
The latest economic growth report from Statistics Canada casts a cloud over the country’s economic outlook for 2015. Real gross domestic product (GDP) fell at a 0.6 per cent annualized rate in the first three months of the year, considerably worse than even forecasters of a pessimistic bent were expecting. Digging into the details, it is clear that the slump in global oil prices is taking a measurable toll on Canada’s energy-centric economy.
Non-residential investment plunged by 15 per cent in Q1, led by sharp cuts in capital-spending by the oil and gas industry. In recent years, the energy sector has accounted for more than one-third of all non-residential investment, as well as for roughly one quarter of Canada’s merchandise exports. So the epic downturn in oil and natural gas markets is dampening overall private sector capital outlays and weighing heavily on Canada’s export receipts.
Harsh winter weather also played a role in the gloomy Q1 report -- consumer spending came in below consensus, as many Canadians apparently decided to stay indoors.
Economists define a “recession” as two consecutive quarters of declining real GDP. We are half way there, and some recent economic data signal further softness into the second quarter.
Digital Infrastructure will continue to transform the Way People Work and Interact
The internet and wireless communication networks have become an essential part of society’s infrastructure in the 21st century. It has altered the way people work and interact and the way businesses operate and serve customers. And the transformation has been very rapid considering that in less than two decades the commercial internet has become fundamental to business operations. Already about 2.5 billion people are connected to the internet, a third of the world’s population; projections point to 4 billion users by 2020, equal to more than half of the global population
Rising Exports will Support Strong Economic Growth in BC
Exports are vital to sustaining and increasing BC’s standard of living because they allow us to pay for imports of goods and services not produced locally, they support hundreds of thousands of jobs, and they provide local firms with opportunities to grow and benefit from economies of scale. The discipline of having to compete in the international marketplace encourages firms to invest in productivity enhancing equipment and processes. In turn, this means that export-oriented industries tend to have above-average levels of productivity and therefore are able to pay above-average wages/benefits.
Growth and Greater Diversity in BC's Export Base
A primer on BC exports
As a small, open economy British Columbia has always depended on and prospered from its international connections. These linkages have been steadily enhanced and supported by improved global transportation and communications; expanding cross-border flows of goods, services, capital and technology; expanding the growth of international travel; and rising numbers of international migrants.
Women in Small Sized Business in BC
Small businesses make up ~98% of businesses in Canada and provide more than 50% of the private sector payroll. The figures are very similar for British Columbia. It is not a large leap to discover that small businesses support a significant number of jobs and contribute a great deal to our GDP – about 26% in the case of BC.
Finlayson Op-Ed: The Sobering Reality Behind Business Incentives (Troy Media)
Recent news stories from both sides of the Canada-U.S. border highlight the growing role of business incentives and “subsidies” in shaping the climate for corporate location and expansion decisions.
The big three U.S. automobile producers are in the midst of downgrading their presence in Ontario as they build new plants in various American states as well as Mexico. Asian and European automobile producers are also stepping up capital spending in the U.S. and Mexico.
One of the factors behind this trend is the rich incentive packages provided by U.S. state and local governments keen to secure auto-related manufacturing plants and jobs. While Ontario and the Canadian government have also been prepared to spend taxpayers’ money to lure automobile investment, so far they have been unwilling to match the stupendous sums on offer in states such as Kentucky, South Carolina, Tennessee, and Michigan.
Whitworth Op-Ed: Liquefied Natural Gas is a Generational Opportunity (Vancouver Sun)
The debate about the future of liquefied natural gas in British Columbia is generating plenty of heat, but often too little light. A casual observer can be forgiven if he or she is just a bit confused about whether LNG will come to B.C.
Strip away the rhetoric, however, and a truth remains: In a growing world economy hungry for cleaner forms of energy, the market for B.C.’s natural gas remains strong.
As CEO of Seaspan ULC and chair of the British Columbia Business Council, I think it is important we remember this when considering LNG’s potential to shape our province for the better.
Forest Sector Remains a Vital Economic Engine for BC
British Columbia’s forest industry is an integral part of our economy and remains one of the most important economic engines for the province. It generates tens of thousands of jobs directly and supports many more jobs in other sectors that sell goods and services into the different elements of the forest products cluster.
Release: Strengthening Asian Investment in British Columbia
Today, the Honourable James Moore, Minister of Industry and Minister Responsible for British Columbia, joined by the Honourable Michelle Rempel, Minister of State for Western Economic Diversification, the Honourable Teresa Wat, B.C. Minister of International Trade, as well as the Business Council of British Columbia (BCBC) announced a new project to attract Asian head offices to Vancouver. This project, entitled HQ Vancouver, will build on Canada’s competitive advantages in key sectors and attract major Asian firms to set up their North American head offices in British Columbia.
Finlayson: Exportable services an important source of job growth for BC
More than three-quarters of all employed people in British Columbia are engaged in producing “services” rather than “goods.” Services span a wide array of industry sectors, everything from retail and wholesale trade to professional services (engineering, law, accounting, architecture, etc.), scientific and technical services, transportation, financial services, accommodation and food services as well as services that are mainly delivered and/or largely funded by governments (public administration, education, and health and social services). Many of these service industries loom large in the labour market. Retail and wholesale trade, for example, together employ 350,000 British Columbians, another 200,000 or so toil in the broadly-defined education sector, 150,000 work in financial services, and 275,000 earn their livelihood by providing health-related services.
BC’s Tourism Industry: Positioned for Growth
In BC, tourism supports and sustains jobs in every region and serves as the economic backbone of many smaller communities. Compared to other provinces, the tourism industry is proportionally larger in BC, a reflection of the province’s natural beauty and the diversity of both winter and summer activities offered here. Greater Vancouver’s international status as a desirable travel destination contributes to the prominence of the broader BC tourism sector.
Finlayson: US may be poised for economic housing boost (Troy Media)
Is it possible that America’s economy might surprise us with a sustained growth surge? The question came to mind as I recently slogged through a series of blog entries and reports on the web site of the Harvard Joint Center for Housing Studies. The Center’s researchers keep close tabs on U.S. housing markets and have a particular interest in the factors believed to influence the demand for housing.
Productivity and Wages
An important long-term challenge facing British Columbia is to improve upon the province’s rather lackluster productivity record. In recent years, BC has trailed the national benchmark on overall business sector productivity by around 10%. In 2012, BC ranked sixth in the country in business sector productivity. Moreover, the province has had very limited success in boosting economy-wide productivity since the 1980s.