Business Beat: Next Generation Economic Development
Economic development has greatly evolved over the past several decades. This evolution has occurred in relation to who has held the responsibility for its practice and as well for the approaches that have been used in its application.
Economic development was once largely the responsibility of federal and provincial governments however, today the responsibility is shifting largely to municipalities to ensure their own economic-well-being. This is placing great demands on communities struggling to survive with limited resources, the replacement cost of aging infrastructure and increasing demands for new and improved services. What this means is that for the first time in history communities and regions are going to have to think more strategically about how they choose to approach the practice of economic development going into the future.
In the beginning, economies focused outward on chasing smokestacks and trying to attract outside companies to bring jobs. Communities offered incentives, cheap land, infrastructure, tax breaks, and loans with the hope of landing that one big fish. Next came a focus on developing small businesses and encouraging entrepreneurship. Business development programs and financial assistance were the focus for many years resulting in organizations that are still present today (i.e. Community Futures and Business Development Canada). The formation of regional economic development associations (i.e. REDA’s) ensued followed by a focus on the development of private-public partnerships (P3’s).
Though past approaches to economic development are still important, the 21st century has brought a new economic reality that includes an era of global competition, global supply chains, and global market opportunities. This new reality requires our businesses and industries to be world-class producers/manufacturers. Long-term survival in such a competitive environment will demand that we as a city and region also provide a world-class business environment in which they can do business and compete on a global scale. Regions that can offer specialized locational advantages will be sourced by companies wanting to expand or gain access. One of the primary focuses must be on the extent to which the City of Medicine Hat and southeast region does or does not offer a competitive advantage in economic inputs: skilled workers, infrastructure, financial capital, land and property, innovation/R&D, regulation, marketing and quality of life.
The next generation economy is requiring an improved understanding of what is needed to sustain and develop the specialized location advantages that will allow business and industry to competitively serve their end markets.
Throughout this evolution the practice of economic development has become more sophisticated. The future of the next generation economy will require engaging the region’s leadership in a new form of “governance”; not government. Governance is where businesses and driving industry clusters, economic and business development agencies, governments and institutions collaborate to: Identify and determine competitive advantages; develop a joint plan that will set the economic agenda; and prioritize the areas where the greatest return on investment can be achieved. The challenges and impacts of the global economy are rapidly changing and affecting the future of our industries, communities and ultimately our local economies. Now is the time to determine a plan that will ensure we are part of the next generation economy.
The City of Medicine Hat has recognized this need and is committed to action. In 2019, the City and other regional leaders collaborated and placed support behind a business retention and expansion/workforce development (BREWD) initiative that is engaging local business in helping identify, strategize and enact solutions to building greater capacity in our local and regional economy. Additionally, the City is restructuring towards a broader mandate that looks to evolve the Invest Medicine Hat brand moving forward and will mobilize resources in a coordinated manner across a broader range of economic development services. In 2020, Invest Medicine Hat will advance a new economic plan including strategies that will advance Medicine Hat and support the region in building the next generation economy.
Sandra Blyth is an economic development professional with the City’s Economic Development and Land Department which is now serving the business community under the brand of Invest Medicine Hat 2.0.