Slow economy hitting growth plan

Hey there, time traveller!
This article was published 11/12/2018 (2535 days ago), so information in it may no longer be current.

Since Brian Pallister and his Progressive Conservative government came into office, it has made it clear that it wanted to get a few structural things in place before embarking on any ambitious economic development initiatives.

This government had the good fortune of being in office when two companies — Roquette and Simplot — announced intentions to invest close to $1 billion in Portage la Prairie agri-food industries. Its first two years in office saw food delivery company SkipTheDishes increase its workforce from a couple of hundred to 2,000 and French gaming company Ubisoft announce its decision to build a studio here.

That looked good and enhanced the province’s image of a stable, diversified economy. Even the dreadful run of downsizing in the northern mining industry had all been telegraphed before Pallister took the reins of office.

Since then, Pallister has expressed his distaste for the scatter-gun approach to funding economic development initiatives, that was full of duplications, that the previous NDP government had engaged in.

But when it comes to purposeful policy, it took the step-back-and-study approach.

First, there was a Deloitte report that itemized all the programming that was in place.

Then the premier dispatched Dave Angus and Barb Gamey to go out and hear from the business community in person about the challenges that need addressing and “positive solutions that can enable growth and prosperity.”

Last week, the premier launched his Economic Growth Action Plan. Even though he had a large, captive audience at his annual state of the province address, Pallister chose to underplay the release.

Maybe that was because it mostly just featured a restructuring of the department with no new programming per se, and nothing that would obviously cause any immediate alteration to the lay of the land.

The fact is, there’s not much Pallister can do about the overall slow-growth economy the country finds itself in right now.

But a new survey commissioned by the Manitoba Chambers of Commerce that was released on Tuesday shows that the business community is not in a particularly enthusiastic state of mind.

The results of the web-based survey of 500 chamber members produced by NRG Research Group indicates a tepid level of optimism. While 71 per cent said the province is heading in the right direction, six out of seven of them were only somewhat convinced of that.

Perhaps most surprising was that only 27 per cent of respondents said they expect their company would be hiring more people this year, with 67 per cent saying their workforce would stay the same.

Chuck Davidson, the Manitoba Chambers CEO, said, “My takeaway is that people think things are going in the right direction, but they are very cautious in terms of their decision-making about wanting to hire people or wanting to make investments and they are really looking at cost pressures before making those decisions.”

Davidson characterized the widespread sentiment as being in the “mushy middle.”

“It’s not the environment we want them in,” he said. “We want to see more than 27 per cent looking to hire people. The fact that you are just holding your own, that is a concern for me.”

This is the first time this survey has been conducted with these questions and with respondents from across the province and so there is nothing to accurately compare.

Probe Research has been doing an annual Business Leaders Index for 15 years that targets only the leadership of companies and organizations and uses a smaller sample size.

Last year, that survey found that only 10 per cent of the business leaders who responded expected their company will perform worse a year from now.

The findings of this NRG survey, with different questions and a different survey population, was that 52 per cent expected their businesses to grow and 39 per cent said there would be little to no growth.

However you choose to slice it, the results of this new NRG survey are not particularly dramatic.

Like Paul Provost, president of 6P Marketing, said, “There are a few reservations, but by and large, we (Manitobans) are not known as risk-takers… At the same time, my sense is there is a positive outlook on the economy now.”

That may be, but the survey did not yield much enthusiasm for the current economic conditions.

Some thought the premier missed an opportunity last week to build a case for more enthusiasm. Then again, his government has taken some steps to provide the framework for growth.

And that will need time to materialize.

martin.cash@freepress.mb.ca