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THUNDER BAY, ON   ----   May 25, 2011 ---  With the recent announcement through the Northern Frank PulliaGrowth Plan that the province is prepared to support Regional Economic Development Planning, there is renewed hope and optimism that this region may get the help needed to push it through the economic difficulties created by the demise of the forest industry and the challenges inherent in our resource dependent economy. 

While 2009-10 population statistics for the city of Thunder Bay and region appearing to stabilize, the trend since 1996 has been one of slow but steady decline. Statistics Canada projections for the city and region over the next 10 and 20 years also indicate a continuation of this trend.  Given some successes on the economic front especially in health, education, and mining, why do these agencies continue to predict a decline?

Let us first start with trends. A trend by itself does not predict the future, but it is a strong indicator of what would happen if things continue the way they are or have been in the past. They indicate direction and movement that may be difficult to stop or reverse. In fact, when we look at the potential of this region for job creation, economic growth and therefore the municipalities’ ability to maintain services with a steady tax base, we need to look where these jobs are coming from. It is commonly understood that Northwestern Ontario is still largely reliant on resource industries. About 40% of all jobs were created in the forest, pulp and paper industry. Mining provides a much smaller base for jobs, but offers a lot of potential (especially in exploration and related services) given the increasing demands of a resource-hungry world market. 

Most of the remaining jobs fall under the category of “service industries” with some manufacturing. Most people sense that there is a need to diversify the economy and broaden the tax base. Two areas that naturally come to mind for further expansion are manufacturing and tourism. Recent announcements for investments in tourism in particular show that all levels of government are taking this important part of our economy seriously and continuous support of worthwhile projects will further strengthen our region.

Given the above scenarios, it is reasonable to assume that growth in the health and education sectors, along with that in Information Technology, service industries and tourism cannot compensate for the past and future foreseeable losses in the natural resource industries (given the continuing high dollar and hydro rates) unless some aggressive steps are taken by the various levels of government to address what economists call structural weaknesses in the local regional economy.

Under the auspices of the Regional Economic Planning project, a joint task force (JTF) has been formed with a mandate to explore a regional approach to economic development in Northwestern Ontario. The JTF is taking up the challenge and regional consultants including myself have been engaged to do in-depth research in the critical factors that will allow this region to face up to the new realities of a changing economy, and look for opportunities to renew itself.  

Additional consultation will be undertaken in the eastern part of the region by Sarah Lewis, Economic Development Officer for the Municipality of Nipigon, with Fort Frances consultant Tannis Drysdale tackling the west. These findings along with best practices from regional economies around the world will be presented and discussed at a Summit in Thunder Bay on June 13-14 and Sudbury on June 15-16, 2011.   

The main challenge for this initiative will be to reconcile the different economic realities of smaller regional communities and the larger centres like Thunder Bay. Will a common approach and regional collaboration alone work, or do we require a segmented and unique approach to different areas within the region? Whatever the solutions, let us focus on new and innovative ways to create such opportunities by remaining committed and firm in our resolve to make Northwestern Ontario the place to be. 

Frank Pullia is the Principal of Pullia Business Consulting and the chief researcher for the Regional Economic Development Planning Zone. More details on the project and registration information for the summit can be found on the Web site at www.nwoeconomiczone.ca or by phoning Michelle Gallant at 1-800-757-2766 x 336

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