Tag Archives: innovation

The problem isn’t prices, it’s the buyers

Over on Medium there’s an Op-Ed by Spencer Thompson on the high cost of Vancouver Real Estate.

Not just the literal high cost of property, but the risk of a greater price paid by the city .

The secret that no-one actually wants to talk about is that the quality of a city is mostly determined by a simple factor — the number of smart, ambitious people who live there. These people are the ones who want to drive that city forward by investing in opening businesses, donating their time to the arts & community, participating in city planning, etc… Without them, growth wouldn’t happen and you wouldn’t get all of the benefits that great cities enjoy.

The biggest contributor to the decline of a great city is simple — it’s the decline of those smart people. When they decide that the cost of living in a place outweighs the benefit, they move. They don’t just take their money with them, they take their intellectual and future capital with them. This is dangerous. When people aren’t willing to make an investment in a place to live any more, the city doesn’t just lose their taxes for the year, they lose a massive function of potential jobs created, culture added and future capital they can put to work.

Read the full article here.

Now clearly Mr. Thompson is a believer in foreign investors as a primary driver of prices in this city, but whatever the cause, HAM, Drugs or Credit, does he have a point? Do high real estate prices risk driving out ‘smart people’ who would contribute to a brighter future for the city?

What’s holding back the BC economy?

BC’s economy is tepid, with some pessimistic outlooks from business leaders.

So what’s holding us back? Why don’t we have a higher rate of innovation and a broader growth economy?

That’s the question asked by this BC Business article:

Tamara Vrooman, president and CEO of Vancouver City Savings Credit Union, said complacency about the allure of B.C.’s climate, geography, and lifestyle may be one of the greatest risks. “Snow and mountains do not a business strategy make,” she warned. “I see for the first time in a decade, young people between 25 and 34 moving en masse to Alberta, Saskatchewan, and Manitoba, because that’s where the jobs are,”  Vrooman said. “I’m quite concerned about our ability to grow our economy for the next generation if they can’t find gainful employment here.”

The numbers back her up. Statistics Canada figures show B.C. lost 18,900 full-time jobs in 2013. Yet even with fewer spots to fill, companies are finding themselves unable to find workers with the skills needed to grow their businesses. There aren’t enough graduates in high-demand fields, and B.C. wages for even those workers are often insufficient to offset the high cost of living.

Is this a chicken and the egg problem?  Businesses can’t afford to pay enough to bring in the talent that would grow business?  Or is there a complacency problem here, where the environment was always supposed to be enough to draw people in and they’d take a paycut to live here?