I don’t want to be all doom and gloom, but I do want to highlight a couple of important economic indicators for the future.
Talk of a real estate bubble, it’s bursting and the potential economic fallout will be front and centre for the next while. The real estate bubble, the US current account and trade deficits, consumer debt and consumer spending patterns and high energy prices are all conspiring to put the North American (and global) economy into a high-risk situation. Brush up on your Tipping Point.
Meanwhile, the auto industry is in dire straights for the foreseeable future. When Dieter Zetsche, Chairman of DaimlerChrysler states that it is impossible to profitably make subcompacts in North America, watch out for continued recalibration of the trade economics of advanced manufacturing up the food chain. This is just the beginning of a larger trend, not a short-term blip.
So, this places the issue of Canada’s and Ontario’s long-term economic future into sharp relief. The Ontario government in its report Toward 2025: Assessing Ontario’s Long-Term Outlook, identified the Bio-Technology, Information and Communications Technology (ICT) and Entertainment and Creative industry clusters as having important long-term growth potential. Guess what? Those same three industry clusters appear as the bottom three in terms of competitiveness (measured by average wages) relative to competing North American jurisdictions according to the Institute for Competitiveness and Prosperity. So what are we doing about it? MaRS was one response. Innovation Commons is another. More is needed.
Change is rapid and global. But the responses to change must be local. We must make our communities resilient in the face of global change. This was the conclusion of the federal External Advisory Committee on Cities and Communities, led by Mike Harcourt, which reported in June. Which is why initiatives like the ICT Toronto project and the Strategies for a Creative City project are too important to leave to government.
When bubbles burst, when business cycles take a turn, resilient communities adapt quickly and have the structures in place to deploy the resources freed by economic adjustment and provide a secure foundation to build again for the future. Those that lack those structures face long-term decline as talent and capital flee to better environments.
Where is the political discourse on these important issues? Where is the press? Community-builders are needed, with the vision and stamina to outlive the short-term political calculus of any single government. The economy of the future will be built by communities of practice, interest and geography. It is about connecting ideas with talent, experience and capital. We are more than free-moving economic actors, we are citizens of our communities, closely linked to one another.
We need to articulate our aspirations for the future and work toward a new collective project. I invite you to join the conversation.