Economy is a 'basket case,' pollster says2/4/2013
The Maritime region is an economic “basket case” that relies too heavily on the public sector and is in need of a major transformation to become functioning and self-reliant, says a well-known pollster.
Don Mills, chairman and CEO of the Halifax-based polling firm Corporate Research Associates, has tracked economic growth over the past 20 years in Atlantic Canada, and through his research he has tried to understand why the Maritimes – and by extension New Brunswick – have failed to grow their economies at a similar pace as the rest of the country.
“We’ve been at the tail end of economic growth in the country for most of that period in terms of gross domestic product growth and we’ve had consistently higher levels of unemployment,” he said.
Mills told the Telegraph-Journal editorial board this week that the data for unemployment rates, gross domestic product growth, consumer confidence and population growth paints a bleak economic picture that should prompt serious change in government policy and public funding decisions across the region.
And unless things change, the pollster said, the Maritimes are “doomed to be last in the country forever.”
He said Newfoundland has “detached itself from the region” and is moving in a different direction economically.
In New Brunswick, the situation is as bad as it is anywhere in the Maritimes as the economy has virtually come to a standstill.
The gross domestic product, which measures economic growth, was less than one per cent in 2011.
Mills pointed to a deeper dependence on the public sector for jobs, less urbanization and a higher level of seasonal employment as among the impediments to economic growth.
He said the Maritimes are suffering from a “culture of dependence” when it comes to the way the region relies on public sector jobs.
The size of the public sector in New Brunswick is 25.8 per cent, compared 21 per cent across Canada. That number is 28.5 per cent in Nova Scotia, 26.8 in Prince Edward Island and 30.7 per cent in Newfoundland, according to Statistics Canada.
Mills also makes a case for urbanization, saying “we’re too rural for our own good.”
And nowhere is this more true than in New Brunswick.
The 2006 census data show that 49 per cent of New Brunswickers live in rural areas.
The urban/rural split is completely different across Canada, where the same census shows that 80 per cent of the people live in urban areas, compared to just 20 per cent in rural areas.
And much of the country west of New Brunswick fits with the national picture. Quebec is 20 per cent rural, Ontario 15 per cent, Manitoba 29 per cent, Saskatchewan 35 per cent, Alberta 18 per cent and British Columbia 15 per cent.
Comparatively speaking, Mills said “there’s no urbanization happening in New Brunswick.”
The problem with that, he said, is “the cost of public services is dramatically higher” in rural areas.
The answer, Mills said, lies in creating regional hubs that provide public services, including schools and health care.
The pollster said current public policy and employment insurance has allowed a false promise of economic prosperity to exist in rural areas where there isn’t an economic base to support the population and the idea that governments can artificially finance a solution for these small communities is wrong.
“You can’t – it really has to come from within the communities,” he said.
Mills said people in the Maritimes are surprisingly “complacent” because of an “acceptance” that it will always be a have-not region.
That doesn’t have to be the case, he said.
“It’s not because we don’t have smart people – there are lots of great things going on,” he said. “Look at the stuff that’s happened here with Radian6 and a bunch of other IT companies. It’s fantastic, so the talent is here. We have to unleash it. We’re not very entrepreneurial in this region.”