Economic Development 101: The Final Chapter
By Bruce Johnstone
In this series of articles, we have discussed the foundational thinking behind the work of economic development in our community. Why do it?
When I began writing this series I asked EDR President & CEO John Lee to describe their business model. This is what he told me:
“Why do we want economic growth? It generates revenues (for) good social programs, good quality of life, good cultural programs. You don’t do economic development — attract companies or grow companies – just for the sake of it.’’
“We’re all in the economic development business,’’ Lee said. “Brokering, facilitating and bringing people together is really what an agency like ours does. That’s how you truly get economic development.’’
Economic Development Regina is structured as a not for profit corporation. While the City of Regina is its only shareholder, EDR operates at arm’s length from the city, governed by a volunteer board of directors largely drawn from the business community.
Frank Hart, former president of Regina-based Greystone Managed Investments and currently managing director of TD Greystone Asset Management, has an extensive background in economic development.
This year he is stepping into the role of Chair of the EDR board.
Q: Some people question the value of economic development agencies, like EDR, in generating economic and population growth. What would you say to those skeptics?
Frank Hart: “You can either leave (economic development) to chance, or try to do something about it. If you believe you can have some control over your own destiny, then you want to give it a shot. There are other communities and jurisdictions out there that are being quite deliberate and focused on it, so you don’t just compete on your strengths and leave it to chance. Then you’re probably going to lose out.’’
Q: Do small cities, like Regina, need to work harder to attract investment and jobs in order to compete with larger centres, like Calgary or Winnipeg?
FH: “There is some pretty good empirical evidence that shows that once communities get to a half a million people, they become their own economic engine. That indicates that if you don’t step up and try to do something, you’re going to be subject to whatever happens that you may not like.”
Q: Would you agree that one of the goals of our economic development strategy should be to diversify the economy from dependence on resource and commodity sectors, like oil and gas, mining and agriculture?
FH: ”We’ve become very good at digging it out of the ground and growing it and selling it as a commodity competitively across the world. That’s a race to the bottom because the margins in that business keep getting thinner and thinner. So you have to get bigger and bigger scale to make any money, which means that fewer and fewer people are needed.’’
“The next (step) would be to build on that strength in that commodity and add value to it. The food and feed industry is the biggest opportunity right now just because of what’s going on in the world due to climate change, demographics and the lack of available protein over the next 30 years.”
“So that’s the Protein Industries Canada play. Regina has some great natural advantages. It’s smack in the middle of a grain-growing area, so getting into processing in Regina is not a problem. (PIC) is one of the best opportunities we have as a city right now.”
Q: On the subject of PIC, which you’re closely involved with, what could that project mean to Regina, the Prairies and the rest of Canada?
FH: “The world needs (protein). There’s just no way you’re going to feed two billion more people on the planet and a bigger middle class than we have today with animal protein – through dairy and meat. It’s too hard to sustain on an environmental basis.’’
“In the developed countries, there’s been a switch to having more plant protein in our diet anyway. So there’s a lot of currents going in that direction and if we get in it and do the right things, we can really prosper from it.’’
Q: What role did EDR play in helping the PIC project to be selected as one of five Supercluster Initiatives (SI) by the federal government?
FH: “EDR stepped up and resourced the bid, reached out to Saskatoon and other communities and got involved. It was the only economic development agency to put serious dollars into the bid process.”
“That’s why these agencies exist, to make the best of these opportunities when they come along.”
Q: Do you think that kind of behind-the-scenes role is recognized or appreciated by the business community?
FH: “One of the things that has happened a lot since John (Lee) has taken over is this notion of organizing the community and getting all the key players to collaborate together for the benefit of the community. Improving partnerships with the Regina Hotel Association, the Regina Airport Authority, kick starting the Audacity program and trying to get entrepreneurship going in the city. The entities themselves get the public recognition, but nobody appreciates all the hard work EDR does. But that’s its role.”
Q: If you were addressing city council or group of business leaders about the value of EDR, what would your sales pitch sound like?
FH: “I would say: Do you believe we’ll do just as well by doing nothing, as opposed to doing something? So if the answer is, we have to do something, the question is, who is able to do that the best? Is it a city department or an entity like EDR?”
“If it was business owners, the argument is: Do I think my business is better off in a community that’s going down or up in terms of population growth, markets, access to labor supply, good regulations?”
“Do I want the city to be responsible for that or do I want to invest some of my own money behind a team that is prepared to focus on improving the image of the city, so it’s easier to recruit people to Regina?”
“Those are all reasons why businesses want to invest in an agency that can do that for them because they benefit broadly.’’
Congratulations! You are almost ready to graduate from our course, Economic Development 101. Just answer a few simple exam questions.
Q- Why should we bother doing economic development?
A- Economic growth generates wealth that is spent in the community, and taxes that fund our quality of life. More jobs means prosperity and a tax base that can pay for our parks, roads, and amenities.
Q-Should the city be 100% responsible to pay for this work?
A-The city is the catalyst. By investing enough to pay for the core functions of its economic development agency, civic leaders create momentum which attracts support from the private sector and other levels of government. Today for every dollar provided by the City of Regina, EDR is raising another 85 cents from other sources.
Q-Should EDR be looking for Amazon or some other large company to come here and provide hundreds of new jobs?
A-While it is important to create an atmosphere that welcomes new investment to the community, most economic growth comes from companies that are here all ready, or from new start up businesses created by entrepreneurs. EDR is focused on helping Regina’s existing industries and companies to grow and expand.
Q-Whose responsibility is economic development?
A-It is a community-wide mission. Government, private sector, educational institutions and social agencies all have a role to play in building the economy to ensure a better future for everyone in Regina.
