2021 has arrived, COVID is lingering and the XL Pipeline is about to be cancelled. Business as usual in Alberta!
The call for diversification is ‘back on the table.’ While Government has announced plans for encouraging investment back to the Province, it is time for industry to step up.
In 2011, when oil was trading around $100 a barrel and Keystone XL was a no-brainer, economists, academics and businesspeople gathered to talk about diversification. That wasn’t the first or last time for these discussions. While Alberta’s economy is more diversified than 30 years ago, a recent chart suggests the energy sector still accounts for 40 per cent.
The global economy has fundamentally changed, and traditional approaches to economic development no longer works. We have reached the point where this new environment calls for ‘all-hands-on-deck’ to move Alberta forward. As new knowledge emerges, industry will need help in making connections, but the best ideas always come from industry.
The Industrial Society brought the term ‘jobs,’ so attracting jobs became a key focus. While our key resource industry boomed jobs were plenty and the people came. In past years, forces working against our key industry, along with limited help from Government, has caused a different look.
The burning question now is how do we develop a culture that supports continuous innovation and build capacities for a new type of economic development? Past years focused on increasing productivity, meeting endless regulatory requirements and pursuing more consumption of our product. That has changed, and now is the time for visionaries to step forward. We need to transform continuous innovation and expand beyond just creating jobs. We need to create sub-industries within industries. Alberta’s fossil fuel industry provides the feedstock for pretty much everything the world needs and uses. The desperate shortfall in medical PPE is the most recent example. Why can’t they be produced in Alberta?
Governments can lay the foundation for a more robust private sector, but we have to work together, not against each other. We need a forward-thinking economic development strategy and incentives to pave the way to secure investment dollars. Several ambitious Alberta companies are already working ahead to produce building products made from Alberta petroleum at home. Who said Alberta can’t diversify?
Education also needs to be reinvented to offer skill training of a wide variety to ensure workforces are capable of succeeding in this new economy. Examples are a need for skills in Cyber Intelligence, and an explosion in demand for Data Analytics. It is expected there will be thousands of future job opportunities in these fields alone.
We simply can’t accept Western Diversification’s recent and woeful assessment that “the departure of young people from Calgary are beyond the influence of government and there is a very real possibility that Alberta’s economy will never again resemble what it did prior to the crash in 2014.”
Shane Wenzel is president of the Shane Homes Group of Companies. Follow him @shanewenzel on Facebook, Twitter, LinkedIn, Istagram and YouTube.His column is written for the Alberta Enterprise Group, @AEG on Facebook, Twitter and LinkedIn.