Closing the West's east-west gap
April 18, 2008
The Calgary Herald
Written by: Roger Gibbins
In the turbulent seas of the contemporary economy, Western Canada stands apart as an island of prosperity and growth. To this point the region has been spared any direct hits from the struggling American economy, and the global competition that threatens Canada's manufacturing heartland has generated strong demand for western resources.
As a consequence, we hear more and more about the impressive economic strength of the "new West."
Until very recently, however, such commentary has always included the important qualification that the region's economic strength is far more evident in Alberta and B.C. than in Manitoba and Saskatchewan. The striking thing about today's boom in the West is that this gap is finally being closed.
For the first time in 35 years we are seeing strong patterns of growth that sweep across the region. The internal east-west divide between surging economic performance in Alberta and British Columbia, on the one hand, and far more modest growth in Manitoba and Saskatchewan, on the other, is evaporating. Laudatory descriptions of the "new West" now apply to the region as a whole.
The term the "new West" dates back to the early 1970s, when the prairies finally began to shake off the catastrophe of the Great Depression. Agricultural and natural resource prices began to rebound, and in-migration from other parts of Canada resumed.
Even international immigration started to show signs of modest growth, although Toronto, Montreal and increasingly Vancouver remained the real immigration magnets.
Western Canada's population grew by 72 per cent between 1971 and 2006, compared with 42 per cent for the rest of the country. Year in and year out, about 25,000 more Canadians moved into the West from the rest of the country than left the region for other parts of the country. Canadians voted with their feet and U-Hauls as the country's economic centre of gravity began to move west.
However, virtually all of the population growth took place in Alberta and B.C. The Saskatchewan and Manitoba economies were performing well for provincial residents, or at least for those who chose to stay, but a lot of young residents were leaving and not many were arriving from other parts of Canada or abroad.
Over the past 35 years, the pace of population growth in Alberta and B.C. was 10 times that of Saskatchewan, and five times that of Manitoba. Indeed, provincial populations in the eastern half of the region remained virtually unchanged not only from 1971, but from 1931. Canada's east-west divide was being replicated within Western Canada.
Today, this gap is beginning to close. It is not that the B.C. and Alberta economies are in trouble, but rather that growth in Manitoba and particularly Saskatchewan is white hot.
Recent economic forecasts predict that either Saskatchewan (the Canada West Foundation forecast) or Manitoba (the Conference Board forecast) will lead the country in economic growth in 2008.
Both are attracting new people, and over the past six months Saskatchewan has enjoyed a net surge from Alberta as many of the youth who have been fuelling Alberta's economic growth head home, often bringing young compatriots from Alberta with them.
Saskatchewan, especially, is enjoying the perfect economic storm. Resources prices are high, particularly for potash, gold, uranium, oil and gas. Expenditures on mineral exploration have grown by a factor of nine in only four years, and grain prices are enjoying a global boom. Saskatchewan led the country last year in the growth of housing starts, building permits and retail sales. The only downside is an ever more acute labour shortage.
While conditions are not quite as strong in Manitoba, they are very good, indeed.
It is now possible, therefore, to speak of the booming western Canadian economy in truly regional terms, without the usual qualifier that conditions are not quite as strong in the eastern half of the region.
The east-west divide within the West is evaporating.
This dramatic change should further strengthen the West's position within the national economy, and within the national political system.
The four western provinces look more and more like a true regional bloc, with booming economies and growing populations.
Back in 1971, at the birth of the "new West," the region was divided.
Now, in the "new West" of 2008, prosperity is widely shared as the region as a whole comes into its own. As a result, today's boom may well pale before the boom to come.
Roger Gibbins is president and CEO of the Canada West Foundation, a research group based in Calgary addressing the public policy priorities of western Canadians |
