You can also find the summary report for this challenge here. Download the full conference summary report here.
Canada at 150: Rising to the Challenge is about the future. Michael Ignatieff is inviting leading thinkers and doers from across Canada and around the world to grapple with what kind of country Canada can be, and should be when we mark our 150th birthday in 2017. To ask what must be done today to get there. The objective is not to advance simple solutions, or short term tactics. Rather, the conference will start a national dialogue about the big issues that will determine the future well being of Canadian families, individuals and communities.
That dialogue is essential as our workforce continues to evolve. New Canadians now account for two-thirds of our population growth, making our labour market increasingly diverse. In addition, Statistics Canada estimates that within ten years, the number of retirement-aged Canadians who are working will continue to rise. At the close of this decade, 1 in 5 workers will be aged between 55 and 64. The key for Canada’s economic success will be the creation of high-quality jobs for that changing workforce.
High-quality jobs and thriving communities are driven by continual innovation. Regardless of economic sector, innovation, the continual cycle of improvement that keeps a business on the cutting edge; the continual drive to lead in the development of new products that the world is demanding drives wealth creation.
You can also find the summary report for this challenge here. Download the full conference summary report here.
Canada at 150: Rising to the Challenge is about the future. Michael Ignatieff is inviting leading thinkers and doers from across Canada and around the world to grapple with what kind of country Canada can be, and should be when we mark our 150th birthday in 2017. To ask what must be done today to get there. The objective is not to advance simple solutions, or short term tactics. Rather, the conference will start a national dialogue about the big issues that will determine the future well being of Canadian families, individuals and communities.
That dialogue is essential as our workforce continues to evolve. New Canadians now account for two-thirds of our population growth, making our labour market increasingly diverse. In addition, Statistics Canada estimates that within ten years, the number of retirement-aged Canadians who are working will continue to rise. At the close of this decade, 1 in 5 workers will be aged between 55 and 64. The key for Canada’s economic success will be the creation of high-quality jobs for that changing workforce.
High-quality jobs and thriving communities are driven by continual innovation. Regardless of economic sector, innovation, the continual cycle of improvement that keeps a business on the cutting edge; the continual drive to lead in the development of new products that the world is demanding drives wealth creation.
Innovation in turn is driven by knowledge and creativity. In each and every economic sector, from high-tech to construction to mining, knowledge and innovation are and will continue to be the keys to success. In today’s global economy – and tomorrow’s – no sector can remain stagnant and succeed. Every job in every community, today and tomorrow, is dependent on innovation, education and research.
Our recent performance has not been good. Canada invested nearly 10% less in public and private R&D as a percentage of GDP in 2008 than it did in 2005. That is over 20% less than the OECD average, and over 30% less than the United States. A recent Conference Board of Canada analysis showed Canada ranked last among 17 peer countries on educating and graduating PhDs, particularly in science and technical fields. Our productivity growth, the foundation for wealth creation and an enhanced quality of life, continues to decline.
We also know that we cannot succeed unless opportunity is available to all. However, individuals from families earning more than $100,000 per year are more than twice as likely to go to university as those earning less than $25,000. There are still far too few Aboriginal Canadians with post-secondary education (PSE), and while 76% of urban youth pursue higher education, only 67% of rural youth do. In a world where the number of students seeking post-secondary education around the world is skyrocketing, we cannot afford to leave anybody behind. From just 28.6 million students in 1970 to over 150 million in 2007, the world is investing in higher education. China’s PSE enrolment has increased 19 percent annually since 2000. China now graduates more post-secondary students than any other nation.
As Canada looks forward to 2017, what is clear is the world is moving ahead. China and India, not satisfied with labour-intensive production, are moving fiercely up the value-chain with key investments in life sciences, telecommunication and clean energy. India is developing new pharmaceuticals clusters in Bangalore, China in Beijing and Shanghai. To keep pace, countries like the UK and Australia are building next generation digital infrastructure, and investing in leadership in nanotechnology and advanced materials. The nation that leads and produces the goods and services demanded by the world will own the future.
The Canada at 150 Conference will ask what Canada can and should be in 2017, and what needs to change today to get there. For jobs today or tomorrow, the questions are profound. How will we generate and leverage innovation success? How do we make learning, a fundamental Canadian priority? What is the role of the federal government in building a highly skilled workforce that is ready to meet the challenges of diversity, demographics and community?
Caring for an aging population in a cleaner more urban environment requires a set of skills that I am not sure we have in place yet. A national focus on elder care as opposed to child care needs to emerge. Investment (either direct of incented) in new forms of urban infrastructure by the national government s a must. We relegate elder care to nursing home extended living scenarios. Elder care is much much broader than that. It means designing buildings and communities that are much more enabling of this population.
In the discussion article ” the Productive Society of 2017″ we read “To keep pace, countries like the UK and Australia are building next generation digital infrastructure, and investing in leadership in nanotechnology and advanced materials. The nation that leads and produces the goods and services demanded by the world will own the future.”
Is it really a matter of keeping pace with every other national economy and innovative industry? World trade will continue and I do not oppose it. I like bananas and mangos and exotic fabrics, etc., and some foreign products. We also want to make and export products which the world wants to buy.
However, Canadians can raise much more food, and a greater variety, than what it is producing now. We do not need to import so much vegetables and meat from southern US and other countries.
It is also necessary to end Canadian involvement with monopolistic US big agricultural industry using massive amounts of chemical pesticides and herbicides and genetically engineered food products. Our natural resources above ground and below ground are enough to produce almost every product we now import, and much of the US agricultural science has serious long term danger for Canadian agricultural diversity and natural health, and possibly human health as well. Europe is aware and resists American agricultural science.
So what I am saying is that Canada (like other countries) needs to retreat from some globalization enterprise to develop a large diverse economy in the cities, in resource communities, in agriculture, in commerce, and in cultural life.
Canadians born here and having immigrated here have every talent necessary to develop every innovation which the above article wants to have happen in Canada.
All we need to do is to educate our people sufficiently well to ensure opportunity for employment in Canada for such talent and skills.
Half of our waking lives happen in recreation after working hours, a very big reason for working eight hours a day. For this we have the greatest talents in culture and physical recreation. These activities are what give most meaning in our lives. American TV and war movies are a poor replacement for better Canadian culture.
Globalization is not necessary or desirable for everything Canadians need or want. Large corporate enterprise leaders view all progress in terms of greater expansion of international corporate investment and trade. Such growth is not always an improvement for the lives of Canadians.
In fact, it leads to fewer skills and too much specialization, and a narrower range of necessary innovative products and cultural expression created in Canada. Millions of talents fail to find expression in a specialized economy serving the demands of another economy — in effect the USA economy.
The particular social political civilization which Canada was developing from the thirties to the eighties is now being undermined and even sabotaged by what corporate and political leadership has been promoting as the wonderful new world of globalization and NAFTA.
The fact is that if income is a measure of well-being, the incomes of wage and salary earners has not improved since this epoch of globalization and continental integration.
On the contrary, worker income has failed to improve, and poverty has increased even in boom time before the present recession, a recession caused in large measure by deregulated globalized industry and commerce.
What is in serious jeopardy in Canada is domestic agricultural and industrial diversity, and cultural identity, as well as the social security programs we were developing until the eighties, and which we have sacrificed to the free market god. We also need to restore domestic Canada’s communication systems and every kind of modern industry and commerce across all of Canada.
The international exchange of millions and billions of products and trinkets does not make Canadians richer or healthier or happier or more secure.. Well-being and civilized cultural growth is best achieved by focusing first on domestic all-round well-being, not by giving away our natural resources and importing American and Chinese popular culture and manufactured products.
— Jacob Rempel, Vancouver
While we need taxes to provide the social safety net that allows us to take the bold, entrepreneurial risks needed to succeed in a globalized economy, we need to avoid taxes that penalize human effort and job creation, or penalize the creation of jobs in Canada.
In particular, the HST as it is currently implemented really penalizes service industries that require a lot of human input, like cleaning, personal care or language services by widening the gap between hourly contract service prices and take-home pay. It also puts Canadian businesses at a major price disadvantage in software, the games industry, and electronically delivered services, because these direct-to-consumer imports can easily avoid the tax.
I suggest adopting a cross-border tax fairness law, similar to that the EU adopted after the launch of iTunes, to ensure that services and electronic goods are subject to the same sales tax at the point of delivery regardless of origin, and Canadian businesses can compete on a level playing field. I also suggest some form of “human input tax credit” so that a portion of payroll taxes can be offset against HST, this reducing the effective employment tax rate on many groups of service workers to a more reasonable level.
Globalization has reshaped the future of jobs in Canada. We now need a solution to the offshore export practices that reduced job growth for a large cross-section of Canadians in manufacturing and research.
Manufacturing and research careers are central to Canada’s economic growth, autonomy and the creation of the jobs of tomorrow. To combat the transfer of skill-based jobs to our global competitors will require a new national job creation programme; one based on an integrated Canadian research and development institutional architecture, established on three pillars: academia, public and private institutions, and on a foundation of young professionals.
In addition, urgently needed is a federal – provincial venture capital programme that targets job creation by converting Canadian research findings, those made in government and in academia, into commercial products through a shared pan-Canadian manufacturing capability. Specifically, a research and manufacturing network is needed that distributes the load of independent and collective capability – fully utilizing our resources for the good of Canadian workers. This plan values accelerating our potential for innovation and productivity; to produce smarter tools for the manufacturing sector, including improvements in robotics and automation that benefit Canadian product delivery.
I think that it is clear that the economical challenges that we are presented with now are some of the most important changes that we will have to face in the next while. As the economy becomes more globalized new challenges will continue to present themselves and decisions will have to be made to deal with this issue. More money should be invested in green technologies and in research and development that would allow Canada to compete in this century to be a leader not just a follower. Canada, while this is the best country to live in has problems and has lost a lot of credibility in recent years. It is important to be closely aligned with the US on a lot of things but we have to be willing to take our own initiatives and not follow other peoples. There have been remarks that our country was going to try to keep in line with climate change goals set by the US for greenhouse gas reductions and this is how some people promote our plan, by saying it is in line with other countries such as the United States. I don’t think that we have to follow people in this sense. Why not develop our own plan and present it to the international community and show them that an exporting country like Canada can make positive efforts leading to positive action on things like climate change. If an alternative accord or deal is reached with the international community we don’t have to do the bare minimum in that deal, we can meet and exceed those requirements with our own ideas, having Canada leading the way instead of picking up the rear. It’s time that we stood up and let our voices be heard and invest in the future instead of trying to micro manage the present each day at a time. We came together as a country in World War 1 where we united as a people and fought distinctly as Canadians, and I think we need to come together and make tough choices that will benefit us in the future in this century too and regain our position as a leader, something that has been missing from our culture for a long time. (I mean no disrespect to those involved in the war I’m just trying to make a point)
In December of 1886 Ottawa appointed a royal commission to consider the relation between labour and capital in this country. After hearing testimonial after testimonial on how bad working conditions were,commissioners produced an enlightened report full of progressive suggestions that the government promptly ignored.
Lest history repeat itself, as is so often the case, today’s business leaders need to pay close attention to things like the quality of employment. An unhappy disgruntled employee is going to cost the system real dollars in terms of lost productivity amongst other things. We are beginning to see the effects of an aging population, but it doesn’t take a genius to figure where emphasis should be placed in order to service that segment of the population. Serious consideration should be given to a four day work week. If not only to allow for a greater quality of life for those in the labour force, then also as a vehicle to allow for more employees in a specific industry, it goes without saying that a well rested employee Is a happy productive one.
Spending on research and development needs to dramatically increase as does the involvement of industry in our higher educational institutions. Funding models need to be examined to remove the burdens being experienced by our brightest minds. It’s hard to run your mind at full capacity if you are hungry or worried about paying next years tuition. There are obvious things business and government can do to bring about real change and nothing I`ve brought to you today is new. The most important thing I can think of is to constantly seek input from the general population in applying solutions to perceived problems. Sometimes the solution for the most complex problems is so simple a child can solve it. Communication and Collaboration is the key to a brighter future as is Prompt Implementation after careful and conscientious consideration.
Lets hope these talks can bring about change for the better and not just pay lip service to each other.
Since there will be so many retirement aged people still working, it is a great time for them to pass on knowledge and skills to upcoming workers via apprenticeships or other close working relationships. This enables the younger people, whether post secondary graduates or not, to keep learning on the job.
As mentioned above, Canadians have the ability to green our economy. For big buisness, regulation and monitoring can go a long way to moving our economy in this direction. Look at the oil sands in Alberta. They have become greener due to public pressure leading to government regulation. For individuals, lifestyle choices like buying wind power credits for electricity, reducing fossil fuel use, or buying local organic food also green the economy.
Learning from the older people soon to retire and moving towards a greener economy will help keep Canada strong and healthy.
Politicians dictate the direction in which a country moves by allocation of right funding for R & D and innovation. Hence the first step in a progressive nation is to have strong Government which has a short term & long term vision for Canada. This progressive Govt. must have closely monitored annual & 5 year plans which are directed towards meeting its objective.Canada’s strengths are natural resourses such as Minerals & Metals, Pulp/Paper & Forestery, Agriculture, Farming,infra structure & transportation, Energy, Environment, IT, Electronics & technical knowledge.
Now each of these fields has a related industry connected with it.Forexample “Energy” includes Power plants (gas, thermal, hydeo electric, Nuclear, wind, solar, bloom box) . Is the govt. doing enough to allot appropriate funds in each of the fields with right weightage for R & D. A good example is in the Nuclear field where Thorium Reactors are cheap with no radio active waste. What is the Govt. doing to develop this technology as India is doing currently. Fusion reactors are things of future but is Govt. doing anything in this field?. Medical isotope production – what is the govt. doing to keep Canada as the leaders? Each of the Energy sectors has a huge supporting manufacturing industry associated with it – so there are thousands of jobs.
Each of the above mentioned fields must be analysed individually (similar to Nuclear field example) with associated industries. Some of the fields require foreign trade keep them profitable. The govt. should build strong trade ties not only with USA but also with Asian & S.American countries. Presently 90% the Canadian trade is with USA which is like putting all the eggs in one basket & is dangerous. Some industries would require govt. subsidies to compete favourably.
This approach needs a proactive & visionary govt. which has a strong technical base including a think tank – here 30% of retirees could be used.. Is Canada prepared to invest in such a progressive set up which has never been done systematically?. In fact I have never heard of a 5-Year plan in the vocabulary of any Canadian govt. The way to progress is not simple but with visionary thinking Canada with its vast resources & technical knowledge can be #1 country in the World, in 2 to 3 decades.
We really need to kill the idea that free markets somehow magically create jobs. They don’t. In fact, the opposite is true.
That’s how they work.
The much-vaunted competition which drives down prices does so by eliminating jobs or lowering wages, not by creating more jobs or paying people more.
Relying on unfettered market forces to create good jobs is to join the same race to the bottom which destroyed the cod fishery, depopulated the countryside, left the US dependent upon foreign oil to feed itself, and is currently depleting the world’s aquifers at an unsustainable pace, among other neat stuff like un-checked global warming.
Catch-phrases like “allowing Canadians to compete” or “attracting foreign investment” are simply code for inviting the US to become our boss, bank, and landlord, dictate our foreign and domestic policies, take control of our resources, decimate our social programs, and reward those who facilitate the takeover. They need to be exposed for what they are, and hammered into oblivion at every opportunity – like yesterday’s budget for instance, Mr Ignatieff.
You don’t build wealth by selling your assets to somebody else. You become a tenant.
We seem to have nationally shifted from managers of our collective interests to global employees and by allowing such have increased our dependency on the whims of markets to the extent of losing some of our capacity to meet our own basic needs. This has resulted in a meandering flow of riches from our nation that is gradually enriching others at our expense. This flow is more a trickle but if not recognized will surely erode our foundation of independence drip by drop.
So, what to do? The job vision of the future needs to be a contract between equals. We need to devote equal resources to self-staining ventures as to working within a reciprocal world economy. We need to determine our own priorities, innovatively address those priorities then market our solutions outward rather than renting ourselves out to others.
Some examples:
- vertical farming/ urban hydroponics
- advance research in solar distillation (water purification)
- fast-track development of public & goods energy efficient transportation
- comprehensive efficient recycling systems where storing & converting applicable trash to energy and/or reusable items can occur at a single site via a series of interlinked technologies
- innovation specific to our aging population: mobility, adaptive technology, augmentation
My premise is that by focusing on our own needs we can serve our citizens and simultaneously export our innovations to other nations. It is a case of mutual benefit. Think horizontally.
Pain: create opportunities for Canadians in a competitive, social minded global workplace. Jobs are needed locally, nationally and globally. I will try and provide a very concrete example of program to develop jobs nationally and globally. It all stems back to our investment in Education and implementation of our own local resources (our elderly aka “experienced”) and proper allocation of Capital.
Solution: Education, Mentorship Capital programs focused on providing Canadians with ‘the jobs’ of the future. “Project Potential”
Education:
-A review of the “top professional positions” in the next 20 years globally should be done. Specifically professions focused in the verticals Engineering, Biotech, Medical, Transportation and Small Business Development. Which parts of these areas are “hot’ and will need well trained professionals?
-Feds work with Provinces to outline 5 professional positions that it would like to develop in Canada in each province, geared around those provinces need.
-Each province provides grants to those 5 new education
-Tradeschools such as the BCIT’s of the Country embrace new funding and have the capacity and ability to implement new programs.
-Media outreach tied in with province and education institutions (separate media campaigns) focus on show casing these new opportunities the youth of each province and/or professionals in the middle of their careers or even retired looking for new opportunities to contribute to Canadian Society.
-Track all of this education and job creation online for all provincial governments and public to see. Of course competition between provinces to produce the best of these professionals will develop which will be an unplanned positive outcome for Canada.
Mentorship & Networking
With a focus on developing programs around these “5 Professional Positions of Tomorrow”, mentorship programs will be needed to guide some of these professionals. -Hold conferences in each major city with speakers from each of these specific areas of each profession. Encouraging the students (young/old) and/or families of potential students to attend.
Capital
-Create tax incentives for professionals taking this education looking to create startups that are socially and bottom line focused. Providing startup and venture capital is not enough for these social ventures.
-Creating a national Social Venture fund to provide capital to these professionals now trained in soon to be thriving new areas of specialization – allowing them to work to launch businesses that create technology/products/services that benefit Canada from a Social Bottom line & Monetary Bottom Line.
-Private companies & Canada’s Profit 100 Companies sponsor co-ops for each of those students coming out of these programs and place the students in real world situations during their training.
-Bringing in the retired of Canada from the high level of these professions (engineering/biotech/health etc) to help guide young social venture entrepreneurs would be a good use of “canadian human capital.”
If something like this works – it becomes policy. Canada (nationally/provincially) setups a council to determine what new professions are needed globally and locally every two years. Council submits it’s findings to provinces. Provinces must deploy X amount of resources each year to ensure that such programs are well funded. CBC shares it’s case studies of success with the world
I agree totally with David. However there is another topic that should be discussed – “The Right to Die”. I live in a private Retirement Home attached to a Nursing Home. The care is excellent, but there are so many people here who have told me that they would like to die. The have advanced Alzheimers; or are very deaf or blind, and are basically tired of living. How best can we help them?
Jacob, the protectionist economy you’re describing would put Canada’s economy back 50 years. It sounds like you’re arguing that Canada should become a hermit state like North Korea by producing everything we need right here at home, which is known as a state run economy. Closing the doors to global competition and trade is the surest way to put us back to 70’s era inflation and government overspending.
Instead, let’s focus on viable economic policies that create new wealth for Canada using the power of the market economy.
You’re right, there is no reason we have to continue to import trinkets from China and remain a natural resources exporter forever. Why don’t we become the lead innovator and developer of nanotechnology, solar power technology, aerospace, tourism, and higher education? Instead of agriculture, let’s focus on upgrading our digital infrastructure and give Canadians the tools to create the next generation of technological developments.
Government can promote entrepreneurial activity by making credit available, reducing spending, creating global trade partnerships, and by streamlining regulation so it is easier to do business here across our 3 levels of government. Other than that, it is not up to the government, it is up to Canadian entrepreneurs to step up to the plate and innovate.
Make room for the entrepreneurs of tomorrow, the next Mike Laziridis (founder of Research in Motion), our women and new Canadians, and watch our economy grow into it’s prime as we sprint into the next 150 years.
Twitter: @IvanMerrow
Now that our birthrate is falling and our aging population is continuing to grow, it is even more important to diversify our workforce. The solution is more complex than having our aging population pass-on antiquated knowledge before they retire – as this will only perpetuate old guard knowledge and does not encourage innovation. Our country is full of underutilized talent and a rich assortment of cultures to draw upon for unique perspective and new, fresh thinking. It makes most sense to challenge ourselves to promote youth, new citizens, aboriginal peoples, and landed immigrants into progressive roles thus shuttling a new, innovative era for Canada.
Canada has vast natural resources. Most of these resources are exported. Other countries are processing these resources and exporting some of it back to canada. We are alway talking of job creation but hardly have any short term or long term planning to developed the technology to process it here. We have man power. Instead of wealth creation we are giving more importace to the service sector. If we look at the educational institutions, can easily find where the brightest students are going.
What I would like to see is Federal and perhaps matching Provincial Corporate tax incentives for small and medium sized companies to create jobs, not just reduce corporate taxes for profits, some small and medium companies hit the hardest by this recession are not profitable but just breaking even, however they have the capacity to grow and create jobs and need these incentives to create and support innovation and risk taking for job creation. We need to add some legislative goals for fairer hiring practices to take on more new Canadians in mentorship and job sharing programs. We need to give some goals and aspirations to companies as they don’t do it on there own unfortunately. We have many under utilized New and Young Canadians that need these fresh start approaches mandated by Government. We need leadership and guts to see that the private sector will not consider lofty National or Provincial goals without leadership this is most true for larger multi-national corporations who take there leadership outside our borders. We need not more Government but Smart Government, I know this will make the Right wing ideology cringe, but in as large a Country like Canada is with such a small population with diverse Regional needs, it is the only way to build strong regions with National goals and aspirations. This is true for many aspects of our National fabic and is necessary to keep that fabric in tact.
It appears the GST has the support of most economists, and the switch to HST in BC and Ontario is also seen as positive in that quarter. From a domestic economy and environmental standpoint however, I wonder if some tax policy needs rethinking.
Manufactured products, many of them imported, often produced in an environmentally questionable manner, and often shipped thousands of miles in polluting ships, only to end up in a landfill in 5 to 20 years, seem representative of a consumption pattern that is questionable in terms of sustainability and longterm economic benefit.
Services, on the other hand, are often provided locally by small businesses. Local people are employed, more of the money spent remains and circulates in the domestic economy, and the environmental impacts are potentially more benign.
I agree that it is important that we retain a manufacturing base, and that many aspects of globalisation have been positive. I wonder however if economic activities that employ more Canadians and are potentially more environmentally positive shouldn’t have some tax advantage over the consumption of physical goods, with their attendant environmental costs. If it isn’t too simplistic a question, isn’t it better for the economy to spend $1000 locally on services than to buy a new TV?
I agree with Rezaur that more of our natural resources and agricultural products should be processed in Canada. I think it is ridiculous for us to be sending raw lumber to China to be processed, and then buying these ‘Made in China’ products at our local stores such as Rona or Totem.
Another issue that has not come up is the lack of coordination among provinces when it comes to local trade. There are more barriers to trade from province to province than there is to trade from foreign nations. Also, why are there no national standards for the professions? Why must professionals have to be re-accredited when they move to another province…such a waste of time and resources.
David Mc Phee is right on … and further we need to be looking at the attitude towards aging , and the ” ageist ” society within which we are living … we need to be working on the attitude that suggests that when you reach a certain age ( usually 65 ) that you are “old” …and thereby “finished” within society. Encouraging older adults to b e more active , to be more engaged , to participate in the issues that are of concern to them within all aspects of our society is critical to longer and more productive lives… and also to reducing the impact ( or at least delaying the negative impacts ) on the Health care system .
Physical activity ( in spaces designed for older adults ) , good nutrition , age freindly spaces in our cities ( including effective access in the winter months to services )and public spaces for gathering and just hanging out ( like the old town halls , or city Centres ) thereby reducing social isolationism ARE all parts of an overall strategy towards effective aging in place …
This requires coordinated efforts Federally , provincially , and above all with the National and provincial non profit sectors.
It has been shown time and time again that innovative companies are more productive, more profitable over the long term andthereby more sustainable than those that are not. Innovative companies are game changers who can increase and preserve market share and provide greater job security and enrichment for staff. Innovative firms also display certain unmistakeable characteristics, including above sector ratios of expenses, as a percentage of sales, for R&D, international marketing, staff training, and capital equipment. They also exhibit a much higher propensity to patent the intellectual propoerty of a grwoing stream of product, process and service innovations than less competitive firms. Typically they are the first to obsolete their product offerings with indusctry leaders turning over half their products every five or so years.
As a former executive in the Public Service of Canada in the economic and regional development area, I along with many of my colleagues wrestled with the issue of Canada’s lagging performance in innovation and productiviity for most of the 35 years of my career. The Conference Board of Canada has documented this lagging innovation performance annually since the turn of the 21st century.
But rarely did we succeed in setting the innovation policy table for a truly bold move forward. Among other things, the political will to do so has been too tepid and temporary. A trully boldmove is needed now more than ever as Canada faces growing competition from around the world to master and command the heights of the knowledge-based global economy. Just think for a moment about the rise of India and China in this context. We collectively must throw off the old paradigm of relying on harvesting and shipping our raw natural resources abroad underpinned by an undervalued currency. This is a complacent posture that both the private and public sectors in Canada continue to strike to the detriment of the standard of living for current and future generations of Canadians.
I have come to one overarching conclusion: we face a systemic cultural problem in Canada which requires a major change in mind set and behaviour in both business and government. That problem is the failiure to inculcate innovation at the centre of all business models and public economic development policies. Research and development is but one aspect of innovation but tends to be given inordinate focus in government industrial policy and priorities. Too many companies ignore R&D as a key component of competitiveness. As Peter Drucker put it so succinctly decades ago, business hs but two main functions, namely, innovation adn marketing.
Innovation in business needs to be an integrative function owned by corporate leadership and not just the purview of the head of the R&D organization. Innovation needs to be treated as an intrinsic and strategic investment process in the futurity of companies rather than treated simply as an operating expense to be adjusted by the rise and fall of sales.
To send the right behavour-changing signals and set the right and sustained fiscal framework, the current tax system’s focus on the scientific R&D tax incentive should be drastically reformed, enlarged, and extended to all three sectors of our economy to encourage so as to support all major elements of the innovation process. Innovation encompasses more than R&D (concept generation and testing). It includes ongoing competitive market research and verification testing, process development and piloting of production runs to assure cost, quality and doability at scale, related staff skills training and development, and market development initiatives including partnering/ sales channels selection outside Canada . Many of these activities are not eligible under the present R&D tax credit yet are essential to the success of commercializing innovation which entails costs that rise exponentially from the initial R&D costs incurred to achieve proof of concept. Also, to attract multiple rounds of venture capital to SMEs , the new innovation tax credit must be sharable in the same way that current mining, oil and gas resource exploration and development investment tax credits are.
With this universal Innovation Investment Tax Credit, government can reduce and even eliminate a number of funded R&D programs that amount to billions in annual funds. It could reposition the NRC’s Industrial Research and Development Program, and DFAIT’s Program for Export Market Development to provide technological and market advisory services which they both were initially set up to do. The government should also work closely with the private sector’s financial services sector including accounting firms, management consulting firms, and venture capital investment firms as well as business schools to imbed the new tax-supported innovation culture deeply within the psyche and behaviour of Canada’s current and future generations of business leaders.
I don’t intend to pitch this bold move as a silver bullet or panacea. The pace of change in the knowledge-based economy is just too high to think in such terms. However, the failure to make this bold move will only serve to accelerate Canada’s continuing downward trend to a state of chronic deficits and deteriorating standared of living and quality of life. That is a vision of Canada 150 that no thinking Canadian wants or wishes to see come to fruition.
Gerry Cooper
Public Polilcy Advisor at Large
Jacob is absolutely right on. If we look at Western history for the last 1,000 years or so, it has been about the ‘privileged’ jostling each other for position while standing on the heads of the rest of us. The difference now lies only in the titles – CEO instead of Baron, Chairman instead of Lord.
Just as the British East India Company lobbied the Courts of English Kings to go to war to ‘protect’ their trade routes, Texas Big Oil lobbied the US government to ‘protect’ their profits by warring with Iraq.
Now we see the “Tea Party” twits in the US who think they are like their forefathers who dumped taxable tea into the harbour. That tax was imposed at the request of, you guessed it, large global traders usurping government authority to eliminate smaller regional competitors. The current tea partiers have been coerced by corporate interests, into thinking government is the issue.
Canada at 150 is at a crossroads. A choice must be made – the same choice which must be made by every generation: Are we willing to put ourselves out a bit to maintain democracy?
Democracy is more than voting from time to time – it is equality of opportunity, it is freedom from coercion, it is exercisable human rights.
Like it or not, direct or indirect, the goal of the proponents of NAFTA and the WTO movements is the elimination of functional democracy and the retirement of respect for human life. For those who don’t believe, – check out the agreements and their dispute resolution processes. No more resorting to Canadian courts – the World Bank decides issues. In private.
Recent precedents in North America have altered the concept of “eminent domain” to include the ability to gain higher taxes from land use as a reason for expropriation. It’s not for a highway or a hospital you lose your home it’s to let a corporation build a high-rise condo.
I could go on…
Here in brief are a few suggestions to promote economic development and jobs:
1.Reducing corporate taxes recently hasn’t much promoted productivity growth. Therefore instead increase tax credits and allowances for R&D and capital investment–you get a tax benefit if you provide an economic benefit.
2.The Quebec gov’t pension fund has teamed up with other financial institutions to provide more venture capital funding to start-up enterprises with, it is claimed, beneficial results. Therefore this should be monitored and if found to be truly beneficial replicated by the Canada pension fund in the rest of Canada.
3.An online registry should be kept of all research being conducted in Canadian universities and research institutes and of all researchers and their areas of expertise and made available in easy to use form to all Canadian companies and entrepreneurs.
4.Green technology and energy development and jobs should be more promoted through gov’t subsidy and research funding–whichever country gets ahead in the inevitable transition away from an oil economy gains a major advantage.
5.Fees for post secondary education should be kept low–that’s more effective in avoiding students being deterred from higher education than increasing loans. Also professional immigrants should be financially assisted to gain Canadian qualifications. And more part time or other positions should be created or encouraged to be created for retirement age people who wish to continue working.
6.The federal gov’t should work to reduce barriers to trade and labour mobility between provinces and with other countries, particularly those countries whose wage and exchange rate levels enable us to reasonably compete with them.
A lot of people are talking about moving the manufacture back to Canada instead of importing product from other country. I think from business point of view, Dollarama import those products from other country instead of buying them locally only because they can earn more profits by purchasing and shipping them from a country far far away. How to make the local product price competitive is the most important.
Hi Hellen,
I think competition is a real problem. Every one is responsible: those who are importing for more benefits and those who are consuming for consumption. The question is: how to make everybody happy?
We cannot. The only think I suggest is that taxed on imports should be raised relatively on companies because we export many things that we do not really need. On the other hand we cannot blame people for being cheap and shopping at Walmart.
Another thing that I learned from living in other countries is the system itself has faults. For example, cell phones are amazingly expensive in Canada in comparison with Europe. Why? Because in order to compete against the service providers you have to be a Canadian citizen, a hurdle that does not allow foreign companies to do business in Canada, but to totally protect those who have the monopoly. The loser is the Canadian consumer. In this case only the government can change the situation by intervening, changing the law of competition, and looking for the interests of people and not only businesses.
Hi Jacob Rempel,
I do agree with you in a couple of points, especially making Canada a kind of distant and independent from the US. The Canadian rapprochement to the US during the Harper government did really harm Canadian reputation overseas. I noticed that when I went on a 5 months trip to Africa and Europe last year. Canada should avoid being part of those countries that have to clean the US mess in a war, after the US starts it and leaves. Our troops went to Afghanistan based on a peace mission and their job was to monitor the events. Now our troops are in a war against Taliban. We do not need to be involved in war because we are scared of being isolated. Switzerland and Austria were war neutral countries during WWI and WWII and they are just fine. Isn’t Switzerland still one of the richest country in the world?
I do not think that we can distance ourselves from doing business with the US because they are our closest neighbours and we have common interests. I suggest personally that we should control and monitor these relations by having an eye on our government and its activities. We should require more transparency from the Canadian government.
If we want to advance things and improve the environment, car industry, trade, and education, then we should implement the required infrastructure over a plan of a couple of years. We cannot afford to talk about solutions without being active towards them. A big problem that we have in Canada is that we rely only on experienced or rich (or both) politicians instead of relying on both. we need very educated and reliable politicians that are educated at higher levels and not: you can make the job because you are qualified enough or you are experienced, or even because you know somebody. We need to put more academics in the provincial and the federal parliaments and give them enough money to do a good job, instead of giving them less and handing over the job to business people that do not care about their wages so much but they are there to defend their own interests and not those of the Canadian people.
Hi Ivan Merrow,
I disagree with you in many points, with all respect.
If we look at the history of industrialization and development, we will discover that many rich countries used protectionism against foreign competition. The UK itself used this policy against the US, when the US wanted to spread and become independent in 1900. There is a very famous book about protectionism called: The Bad Samaritans. Even South Korea used protectionism too. In fact, all the developed countries did.
Many people also think that we live in a pure capitalist system, where there is a division between government and private business or what we hear nowadays non-governmental intervention. If we think this is true, then we should ask ourselves about the welfare system, social assistance, social insurance,…..
The government is always present, the only difference in my point of view, is that there is less government now than a couple of years before.
We need to have a real shift in our thinking and policies if we as Canadians want to become more competitive with other nations and more financially secure in the future.
Canada is a huge country geographically, but small in population. Our competitive advantage is in the highly educated and motivated people in this country who have a world (literally) of experience to draw upon.
Knowledge based industries, whether software, hardware, biotech, greentech or life science are key to our future. But as the Conference Board of Canada has stated regularly in it’s annual Report Card on Canada, our biggest problem in Innovation is that we don’t take our ideas and bring them to market as products efficiently.
I recommend 5 major steps to change that over the coming years:
1. Fully utilize the skills and abilities of the Canadian workforce
2. Fix the financing issues for entrepreneurs
3. Match technologists with experienced Product Management and Marketing resources early on
4. Create a national culture that celebrates innovation
5. Resource industries can no longer be the primary focus of Canada’s international trade strategy
You can read the details here: http://www.bit.ly/aJHvXH
The full URL is
http://onproductmanagement.net/2010/03/25/canadas-innovation-gap-part-3/
Saeed
A more productive society … a society where opportunity is available to all … must also be a “just society” where each citizen fairly contributes to the common good and hard work rather than speculation is rewarded !
I think Canada at 150 should address certain “inefficiencies” that plague our capitalist market economy including the two issues herein below.
1) The use of “cash paper money” is at the root of a monstrous underground economy that does not contribute taxes and unfairly burdens other taxpaying Canadians … it is at the root of illegal campaign financing that warps the democratic process and corrupts our elected representatives … it is at the root of the drug trade that poisons our youth and other criminal activity that so often leads to murder and violence in our communities. In our electronic age, why do we need cash paper money ? Can we not eliminate cash paper money and all its evils by doing business in a more transparent and accountable fashion with debit cards or credit cards only ?
2) The Bank of Canda’s low interest policy during the past decade or so was intended to make the purchase of a home more affordable. But in the end, the lower cost of borrowing has been offset by surging real estate prices (that have outstripped general inflation and average increases in salary) and made housing even less affordable for the average Canadian and especially young Canadian families. The surging prices have amounted to a vast transfer of wealth to vendors, speculators, and developers that did relatively little to earn such spectacular gains. What can our government do to discourage speculation, prevent “bubbles” in real estate and make housing more affordable ? Should capital gains continue to benefit from such a favourable tax treatment ? How do we make real estate transactions more transparent and real estate prices more stable ? Do we need to better educate buyers of real estate ? Why don’t we at least force vendors and listing brokers to disclose the previous price paid for a property … so potential purchasers are better informed about any recent “flipping” of the property and so they are in a better position to assess the market value of the property for sale ?
James D. Smirnios
Montreal