New economic realities creating uncertainty

What is happening all over is factories are closing, and their jobs are disappearing. That is the result of the shift to a service or knowledge-based economy dependent on how optimistic you might want to be in labeling it.

In the space of one working lifetime, from the late 1940s to the present day, Canada has gone through a workforce that was more than 60 per cent in the goods sector, (natural resources, manufacturing, and construction), to over 75 per cent in the “softer” service industry. Furthermore, as has been pointed out repeatedly, the transformation is far from over. Those are the new economic realities.

It is widely acknowledged that this shift to a service economy will change the urban landscape fundamentally, and revive outlying depressed regions, if we can take advantage of it with a brighter, better-trained workforce. That will alter the employment situation, and help replace the jobs lost as manufacturing jobs vanish.

With modern telecommunications and a more sophisticated workforce, companies will decentralize their operations to less expensive locations. That explains the move of head offices away from Toronto. It also was the sales pitch made by the governments in the Maritimes.

In New Brunswick, for instance, there is an educated workforce, accessible recreational facilities, and housing that probably is one-quarter of the cost of downtown Toronto.

Large business logically will move their back-office operations to places such as the Atlantic provinces.

That is an appealing idea. made all the more worthwhile because of a growing parallel idea that governments, notably in the less developed regions, should be placing more of their resources into basics such as education and job training, and away from direct business subsidies or more costly mega-projects.

Unfortunately, current trends, if anything, make the task of reducing regional disparities ever more difficult. The new dynamic services, the good knowledge jobs, are overwhelmingly found in urban areas. That has entailed an ever-widening gap between the prospering and less successful regions. Certainly, efforts to change that should be a government priority.

That should alter governments’ programs.

At the present moment, government cutbacks seem to be taking place in vitally important areas, such as health care. What must be considered are the effects on short-term budgetary problems as opposed to long-term gains.

Most will admit that our present education and health systems do not adjust to the realities, to where new jobs will develop.

We must not give up that fight to replace the jobs lost after factories close and such employment drops. There are solutions, now more essential than ever, in view of the lack of a sustained business expansion.


Bruce Whitestone