New Brunswick is grappling with a productivity crisis and declining GDP. To address these challenges, a diverse panel of experts explored strategies to create a more competitive economic landscape through technology, education, energy and infrastructure investments.
Addressing productivity in New Brunswick means confronting a complex puzzle that necessitates collaboration among government, industry, universities, businesses and communities.
With this in mind, the University of New Brunswick (UNB) held the latest installment in the Shaping the Debate series, entitled "Boosting Productivity in New Brunswick: The Road Ahead," on March 11 at the Wu Conference Centre on the UNB Fredericton campus.
Tracy Bell, executive director of UNB's Wallace McCain Institute, moderated the expert panel consisting of David Campbell, president of Jupia Consultants Inc.; Dr. Herb Emery, Vaughn chair in regional economics at UNB; Craig Estabrooks, president and CEO of Port Saint John; and Adrienne Oldford, executive director of the McKenna Institute at UNB.
In his introduction, Dr. Paul Mazerolle, UNB president and vice chancellor, highlighted national and provincial productivity challenges. He cited Carolyn Rogers, senior deputy governor of the Bank of Canada, stating that Canada has seen no productivity growth in recent years and among G7 countries is second only to Italy in productivity decline.
"While this problem is not new, geopolitical realities that are new are providing us with what, I hope, is the will to come together to find and implement solutions," he said.
Panellists agreed that N.B. stands at an economic crossroads. The path forward requires bold thinking, strategic investments and a willingness to challenge traditional approaches to economic development.
Campbell started by saying that to have a strong economic foundation, the province must have a competitive economy.
"And in order to have a competitive economy, you have to have a productive economy," he said.
Outlining the province's economic challenges, he noted the drop in the province's average annual gross domestic product (GDP) from about three per cent to below one per cent.
He said some sectors, such as pulp-and-paper and office administration services, are actually more productive here than in the rest of the country, while others are at a disadvantage.
Campbell argued for a strategic approach to economic development using energy.
"We should be creating a lot more energy and then using that energy for economic development. Two-thirds of the province is either Crown land or industrial freehold. We could put a wind turbine on every hill."
Estabrooks said N.B. is facing global challenges, too.
"We're at an unprecedented moment. We're looking at it from a geopolitical standpoint. We're looking at 80 years of the paradigm that we knew post-World War II crumbling in front of us that will have an impact on commerce," he said.
"If we don't address our productivity challenges now, we may find ourselves left behind in an increasingly competitive global economy."
In response to Bell asking the panel to share their definition of productivity, Emery provided a basic definition of what productivity' means.
"The simplest definition we should think about is working smarter, not harder. It's really about getting more output per unit of effort."
Adrienne Oldford looked at productivity from an organizational perspective.
"In the companies that I grew up in throughout my career, it was always about process improvement, but also about innovation."
Later in the discussion, Oldford emphasized the importance of education and digital innovation in productivity.
"We've invested $1.3 million in K-12 programming," she said of the McKenna Institute.
"We're trying to ensure that every student gets exposure to digital technology and how they can solve their own community-based problems using technology."
The panellists identified multiple barriers to productivity. Emery noted the complexity of setting economic priorities.
"We need a bigger debate about what the economy's priorities should be. Are we prepared to do what it takes in 2025, or are we prepared to live with less material growth in society?"
Businesses need stable energy prices and property tax rates to plan their costs. If they don't have that certainty, they'll move to places that do.
Panellists emphasized the need for the province to support and foster growth in small and medium enterprises (SMEs) while also encouraging large industries.
In recent years, government policy has favoured SMEs over large industries, but in challenging economic times, like the post-war period, large industries drove the province's economic growth.
Emery noted that not enough N.B.-based SMEs have grown to replace traditional industries.
"When you tour our top exporters, they have cutting-edge technologies. They're heavily capital-intensive, they're integrated and they are doing everything," he said.
Estabrooks highlighted the importance of leveraging existing infrastructure for growth, such as the rapidly expanding Port Saint John.
"At Port Saint John, we have five weekly container services. They go to North Europe, the Mediterranean and Latin America. We have opportunities if those are your markets," he said, emphasizing the port's export infrastructure, which is now mainly being used by companies from outside the province.
For now, panellists remain cautiously optimistic.
"We have tremendous assets," Campbell said. "We need to double down on our strengths and be bold about developing new markets and industries."
Oldford emphasized better collaboration between industry and academia.
"The talent is there in industry. The talent is there in academia. Our cultures are so different, and we must work to put that aside and get focused on what the real goal is, which is productivity in our industries."
Mazerolle emphasized UNB's critical role in continuing to foster community dialogue.
He also stressed the need for collective action to address these challenges and reiterated UNB's commitment to developing solutions.
"We will continue to create a skilled workforce that meets the needs of industry and society. Our campuses are environments where scientific and technical innovation thrive," he said.
"We will continue to do what we are doing today: hosting public dialogues to help discuss and determine a path forward to success."
Key takeaways
- New Brunswick's productivity is critically low, with GDP growth declining and manufacturing profitability ranking lowest among Canadian provinces.
- Productivity means working smarter, not harder, involving more output per unit of effort and requiring strategic investment in technology and innovation.
- Policies that have prioritized fairness over economic growth, are potentially hindering the province's ability to scale industries and attract investment.
- Immigration and education are crucial, with a need to develop a digitally skilled talent pool and create opportunities for newcomers to contribute to economic development.
- The province has significant untapped potential in its existing assets, including energy production, port infrastructure and sector-specific strengths that government could leverage for economic growth.
