Alberta’s Great Communities for Business
Great communities are the result of concerted efforts by citizens, businesses and government to create a fair, attractive, efficient place to run a private-sector enterprise. Does it all fall apart in a downturn?
by Robbie Jeffrey
The plunging price of oil has Albertans wondering how low it can go. WTI couldn’t possibly fall below $60 per barrel, said the consensus at one point. Well, maybe it can, the pundits conceded weeks later, but surely it won’t cross the $50 Rubicon. And so on and so forth, ad nauseam, to its record low of $38.24.
When the NDP announced its first fiscal update since Rachel Notley took over the premiership, the 0.6 per cent contraction, the $6-billion deficit and the nearly six per cent unemployment rate surprised few. Even the three sixes, lined up like a portent of further doom, seemed passé to anyone who noticed. But it still felt like a college professor reading a compendium of all your semester’s mistakes; or, as Scott Sharabura of McKinsey & Co. told the Financial Post, “The mood is like a boxer taking too many hits.”
For those in economic development – the process of attracting and retaining businesses – luring investors would no longer be the cakewalk it was during the boom times. If only Alberta could find some magic beans, or a hidden gold reserve, or find some way to market cold weather.
Enter Mark Morrissey, the 34-year-old economic development officer of Fort Saskatchewan who has literally sold cold weather.
Morrissey, who was born, raised and educated in Newfoundland, came to Fort Saskatchewan from Iqaluit, a high-cost environment with scant available land. As the executive director of the Nunavut Economic Developers Association, and later a city councillor, Morrissey thought his city could do more to promote its businesses. He worked with the mayor to advocate for the city as a cold-weather testing centre for airport manufacturing and equipment companies. Iqaluit, with its roots as an old U.S. Air Force base, has a 9,000-foot runway, and commercial aircraft manufacturers need to know their equipment will function at frigid temperatures 40,000 feet in the air.
“We recognized this as an opportunity,” he says. “These aircrafts are coming into town, usually having with them 30 or 40 engineers and testing personnel, and they stay in local hotels, rent equipment, eat in local restaurants and buy souvenirs – directing lots of money into the local economy.” Morrissey and the mayor calculated that every time one such aircraft landed for a two-week mission, its crew injected almost $1 million into the city’s businesses. They applied for federal funding and partnered with local businesses to head to the Paris Air Show, one of the world’s largest. “Off we went,” Morrissey says. “And we were wildly successful.”
Economic development officers (EDOs) across Alberta find hope in such stories, and believe similar bouts of ingenuity can rescue their communities from any resource-based woes. The word of the day, of course, is diversification, and it seems that every community is redoubling its efforts at downtown revitalization, quality-of-life initiatives or other campaigns that embolden its lesser-known strengths.
Jon Allan, economic development officer of Sundre, says his town has seen a 50 per cent increase in tourism over the last year, and that downtown commercial vacancies have decreased. He relates it to Sundre’s high standard of living. “What we’ve been doing is promoting [that standard of living] to make our town beautiful and make people want to live here,” he says, “not just to be entrepreneurs but also to be employees, to be the labour force that’s required for businesses to expand.”
But diversification is no small feat, especially for a municipality like Wood Buffalo. Maria Noorani, senior economic development officer at the Regional Municipality of Wood Buffalo, says that despite the downturn, Fort McMurray has seen a lot of new businesses coming in. Still, the shadow population of fly-in-fly-out workers has dwindled, taking money with it, and institutions that were once symbols of growth now seem to represent something more akin to defeat. The newly completed international airport, for example, has seen use of its charter service plunge. “The major growth that it had envisioned hasn’t come through,” she says.
The biggest challenge for Fort McMurray, Noorani says, is the availability of land. She hopes the municipality’s arrangement with the federal government whereby Wood Buffalo funds infrastructure projects like highway twinning in exchange for Crown land is its own version of cold-weather certification. The municipality just acquired 51 acres for the Parsons Creek residential development, and another 72 could be slated for a power centre. But diversification will be a Herculean feat, especially since the municipality wants the energy sector to come back in full force. Straddling that line seems to be a concern for most Albertan economic development departments: they want to be less reliant on resource revenues but also want the resource revenues to return.
The other word of the day is uncertainty. “Everybody is wondering what’s going to happen,” says Leann Hackman-Carty, CEO of Economic Developers Alberta, of the new NDP government. “Businesses are nervous and they want to make sure investment is a priority.” She says most EDOs are “rose-coloured-glasses people,” prone to focusing on the positives, and considers the new government a golden opportunity. “If they don’t know much about economic development, here’s my chance,” she says.
But traditionally, EDOs and politicians haven’t been kindred spirits. Hackman-Carty blames this in part on a communication breakdown. “They get frustrated with each other,” she says. “So [EDA] says, ‘Look, you can’t expect an elected official to support you and increase your budget if they don’t know what you do.’ ” For EDOs, this will be the central dilemma of post-boom Alberta: how to communicate urgency and potential to investors and legislators using the oft-opaque language of “collaboration” and “diversification.” It’s a common critique of the profession, but perhaps the vague language of economic development is also a strength; perhaps it signals open-mindedness and big-picture planning, a holistic approach that the province sorely needs. It is, after all, not so different from the language the NDP has used to champion the royalty review, the increased minimum wage and other such overhauls.
“When things are good, economic development officers don’t spend as much time really working with local businesses hands on,” says Hackman-Carty. “A lot of their energy goes into business retention programs.” They can no longer afford to take that for granted. “They have to be smart in what they’re doing, so some of them end up staying closer to home and being more creative in their work.” As winter approaches, economic development officers will surely look to the cold weather for inspiration.