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Western Canadian Economy Faces Key Issues to Maintain Prosperity
The Honourable Stephen Owen, Secretary of State (Western Economic Diversification) (Indian Affairs and Northern Development), and Paul Darby, Vice-President and Chief Economist at The Conference Board of Canada, today released Insights on Western Canada: A Socio-economic Report.
The study revealed the western Canadian economy has been operating close to its potential for the past 20 years, but that western Canadians must address innovation, involvement of Aboriginal people in the economy, and deruralization to maintain and build upon their high quality of life. Western Economic Diversification Canada (WD) funded the project and contracted The Conference Board of Canada to produce the report.
"This study confirms that Western Economic Diversification Canada's core program areas of innovation, entrepreneurship and sustainable communities are on target for improving the quality of life for western Canadians," said Secretary of State Stephen Owen. "At the same time, it provides options for future program and policy development consideration."
Western Canada's performance in various categories is compared with four other jurisdictions: the six provinces and three territories in the rest of Canada, eight northern and western U.S. states, Australia and Finland. Western Canada is a top performer in health, is an average performer in economy, education and skills, and society, and a poor performer in innovation and environment.
"Western Canadians should be very proud of their accomplishments. They enjoy a high standard of living and a very high overall quality of life," said Paul Darby. "However, the region faces several major challenges that must be addressed if it is to sustain this impressive performance. The outlook for many of their key industries is increasingly uncertain, labour shortages will be a looming problem, and it will be necessary to define the role of Aboriginal peoples in the economy."
The study was commissioned to provide a better understanding of the challenges and issues facing Western Canada, and to provide information to support policies and programs that address western economic development needs and opportunities. Its design was based on the Board's annual socio-economic report, Performance and Potential, which benchmarks Canada's performance on key social and economic indicators against comparable countries, and has had a strong influence on public policy since its inception in 1996.
Funding for this project was provided for in the February 2003 federal budget.
Download the report at http://www.conferenceboard.ca/
For additional information, contact:
Susan Schooley
Manager, Communications
Western Economic Diversification Canada
Tel: (604) 666-1318
Brent Dowdall
Senior Communications Advisor
The Conference Board of Canada
Tel: (613) 526-3090 ext. 448
Web Site: http://www.conferenceboard.ca/
WD Toll-Free Number:1-888-338-WEST (9378)
Teletypewriter (TTY): 1-877-303-3388
WD Website: www.wd-deo.gc.ca.
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Backgrounder
- The Conference Board of Canada believes that the success of a nation is ultimately determined by achieving and sustaining a high quality of life for its citizens.
- Insights on Western Canada: A Socio-economic Report uses economic and social indicators to assess the overall quality of life in Western Canada.
- Western Canada's economy has grown at a rate very close to its potential over the past 20 years but the region faces several important challenges.
- These challenges include: potential labour shortages that will make it difficult for the economy to perform beyond its current level of potential output; bringing the rising population of young Aboriginal people into the workforce; the declining importance of traditional industries in Western Canada; and the participation of rural communities in the economy.
The Scorecard
- Insights on Western Canada uses the framework established in the Conference Board's annual Performance and Potential reports.
- Six categories that define a high quality of life are examined: Economy, Innovation, Environment, Education and Skills, Health, and Society. In all, 21 indicators are used for the benchmarking.
- Comparisons are made among five jurisdictions: the four western Canadian provinces; the six provinces and three territories in the rest of Canada; eight northern and western U.S. states (Alaska, Colorado, Idaho, Minnesota, Montana, North Dakota, Oregon, Washington); Australia; and Finland.
- These jurisidictions were chosen because they: reflect comparable economic structures; offer similar competitive levels in regional, national and global markets; impact on Western Canada's performance; and provide potential "best practice" cases for Western Canada to emulate.
- Western Canada is a top performer in one category (Health), is an average performer in three categories, and a poor performer in two categories.
Western Canada's Performance
Economy : Average (Top - the northwest states)
Innovation : Poor (Top - the northwest states)
Environment : Poor (Top - the northwest states)
Education and Skills : Average (Top - the northwest states)
Health : Top (shared with Australia and Finland)
Society : Average (Top - the rest of Canada)
Sectoral Analysis
- The report analyzed the economic potential and future challenges of 10 western Canadian industries.
- Some of the factors that will affect potential output in Western Canada include labour shortages, trade barriers, and environmental issues. These factors will have the greatest impact on high technology, forestry, oil, and chemicals.
- Agriculture and mining face continuing declines in global commodity prices. Trade disputes challenge softwood lumber and steel. A diminishing supply of natural resources is a concern, especially in oil and mining.
Key Issues Facing Western Canada
- Innovation - Unless Western Canada diversifies its economic structure and develops higher value-added goods and services, its growth and incomes will fall behind other parts of Canada and the industrialized world.
- Aboriginal involvement - An Aboriginal population that is fully involved in the economic life of Western Canada could be a solution to the looming labour shortages that will affect the region's potential output.
- Deruralization - Rural parts of Western Canada are losing population and falling behind urban centres in many areas that drive quality of life.
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