EDITORIALS B.C. has two economies

This is the third of six editorials we will publish prior to the provincial election on May 9. Each deals with an issue that is expected to play a role in determining the outcome.

The first two editorials looked at the province’s finances, and at housing. Today’s looks at jobs and the economy.

By most measures, B.C.’s economy is on a roll. We have the lowest unemployment rate in Canada, and our economic growth rate is expected to lead the country in 2017. We are also creating more jobs, on a per-capita basis, than other provinces. House prices remain strong — a mixed blessing — and although still small, our high-tech sector continues to grow. The tourism business has expanded nearly 40 per cent over the past decade, and contributes more to our economy than traditional industries such as forestry, agriculture and fisheries.

But while these numbers are impressive, they conceal a hidden reality that might play a role in this election. B.C. has two economies, not one.

The Lower Mainland and Greater Victoria are forging ahead. The unemployment rate in these two regions is less than five per cent — 3.8 in Victoria.

But move away from those population centres, and the picture changes dramatically. In the Cariboo region and the Kootenay, the unemployment rate is eight per cent, and in Thompson-Okanagan, 8.3.

The same divide exists on Vancouver Island. Communities in the centre-north of the Island, such as Port Alberni and Campbell River, have not enjoyed the same good fortune that Greater Victoria has experienced.

Consequently, this is the challenge facing whichever party wins the election: How do you shape an economic policy for the province as a whole in the midst of such disparities?

And in particular, how are the two most influential aspects of any such program — taxation and environmental regulation — to be managed?

B.C. has the lowest business tax rates in the country. It could be argued there is an opportunity here to reinforce government revenues by nudging these taxes upward.

Yet while this might be viable in our economic powerhouse regions, what might it do to struggling companies in Prince Rupert or Williams Lake?

Likewise, there is general support in the Lower Mainland and the capital region for tougher environmental regulations. But how does this play out in Fort Nelson or Prince George? The party that wins must find the right balance here. Then there is the debate about where to set the minimum wage. At $10.85 an hour, B.C.’s current rate is below the Canadian provincial average of $10.98.

The NDP and Greens believe a more generous approach is essential to tackling poverty. The Liberals and Conservatives believe a lower rate protects jobs.

There are arguments on both sides of this divide, and here, too, the winning party must find the right balance.

Lastly, there is the matter of skills training. It becomes clearer by the day that employment in traditional bluecollar industries is threatened. And young people find it harder than ever to land a full-time job.

Most of the causes underlying these trends are beyond our control — globalization, the flight of manufacturing companies to low-income countries, robotization.

The only feasible solution is to retool our workforce. That would require a major expansion of training programs in the province’s post-secondary institutions. It would also be beneficial if older workers could broaden their skills in mid-career.

Of all the issues driving this campaign, supporting our workforce is perhaps the most challenging. There are no quick and easy solutions.

But the party that offers a credible plan to generate economic growth, and create quality jobs provincewide, gains a head start.