2011 Pre-Budget Submission of the Manitoba Chambers of Commerce

Mar 6, 2011 | Government News

EXECUTIVE SUMMARY:

This is the sixth year the Manitoba Chambers of Commerce has called for a Great Jobs Agenda. 

The Essence of the Great Jobs Agenda:

For employees ‘great jobs’ are well-paying and engaging. For employers ‘great jobs’ are highly profitable and lead to true competitive advantage.In what has been called “the great promise of our time”[1], we are at a point where the path to the great jobs employees want and the great jobs employers need is one and the same:

In a knowledge economy that is increasingly globalized, mechanized and digitized there is one and only one sustainable path to great jobs: creativity.      

That is why the cornerstone of the Great Jobs Agenda is a call for a disciplined and steadfast focus that judges all economic and educational efforts against one basic standard:

Are our efforts empowering every member or potential member of Manitoba’s workforce to obtain employment that fully taps into their creative potential?

The Manitoba Government has not specifically endorsed the Great Jobs Agenda, but it has embarked on many initiatives that have served the elements we have called for.

Although additional work needs to be done on a wide range of issues, this submission highlights a three-pronged approach to enhancing great jobs in Manitoba:

1) Produce and Publish Annual Sectoral Reports:

– Using the Manitoba Bio-products Strategy as a model, create and publish online annual strategic reports for Manitoba’s key sectors. Each report would highlight the sector’s strengths, challenges, latest innovations, and set out a strategy for maximizing momentum;

– Encourage all of Manitoba’s business associations and Post-Secondary Institutions to share these reports with their members/stakeholders.   

2) Embark on Strategic Tax Relief:

– Step 1: Provide tax relief to low income Manitobans and commit to eliminating all profit insensitive taxes that penalize businesses for investing in ideas, capital or people. Chief among the latter is the need to eliminate the Payroll Tax. 

– Step 2: Embark upon a fundamental review of Manitoba’s tax regime, one that engages both our community and our experts in ‘big picture’ thinking about not just our level of taxation but whether we have the kind of taxes that best serve the goal of growing great jobs in Manitoba.

3) Expand your Innovation Agenda to Include Creativity 

INTRODUCTION:

The Manitoba Chambers of Commerce is honoured to present this, our twelfth submission to this Government and our second to you to as Manitoba’s Minister of Finance.

Last year we provided some context and explanation relating to The Great Jobs Agenda; an eight-point strategy that seeks to maximize our province’s potential in an economy that, as never before, rewards creativity. We will not reiterate that background. For those who wish to reference it, it is available here. 

This submission is not about debating the past; it’s about building a future. The three key suggestions we are proposing are not a critique of your policies. In fact, the recommendations are specifically designed to echo your ideals and build on your efforts.

As the province’s most diverse business association, the Manitoba Chambers of Commerce has communicated with the Manitoba Government on a wide array of issues over the last year, including 16 Resolutions passed by our members at our 2010 AGM. While those issues are important and we will continue to work on them, the three key initiatives we are proposing here are particularly suited to the type of visionary announcements associated with a Budget.                  

RECOMMENDATIONS:

1) Produce and Publish Annual Sectoral Reports:

– Using the Manitoba Bio-products Strategy as a model, create and publish online annual strategic reports for Manitoba’s key sectors. Each report would highlight the sector’s strengths, challenges, latest innovations, and set out a strategy for maximizing momentum; and

– Encourage all of Manitoba’s business associations and Post-Secondary Institutions to share these reports with their members/stakeholders.   

This Government has done a commendable job of embarking on consultations and building partnerships, from its initial Century Summit to the creation of the Premier’s Economic Advisory Council, to the Immigration Council and the Innovation Council.   

For years we have called upon you to take these efforts to a new level by deepening the analysis of Manitoba’s strengths and challenges and broadening public engagement and input.   

For example, we have repeatedly called on you to publish regular reports analyzing:     

  • the need for and state of specialized training and research institutions on a sector-by-sector basis;
  • the need for and state of specialized infrastructure on a sector-by-sector basis;
  • the need for and state of special regulatory regimes on a sector-by-sector basis; and
  • any other special needs identified on a on a sector-by-sector basis. 

The importance of a sector-by-sector approach was echoed by the Expert Panel on Business Innovation:

“There is no single cause of the innovation problem in Canada, nor is there any one-size-fits-all remedy. The short case studies in this report illustrate the great variety in the circumstances facing individual sectors of the Canadian economy and the very different incentives and constraints that affect the choice of innovation strategy in each. Public policy in respect of innovation therefore needs to be informed by a deep understanding of the factors that influence business decision makers, sector by sector.”

Innovation and Business Strategy: Why Canada Falls Short, p. 211 [Emphasis added]  

We applaud the recent announcement of “Growing Green: The Manitoba Bioproducts Strategy”, a sector-specific effort that sets out exactly the type of framework we have been talking about. In particular, we strongly endorse this sentiment contained in the strategy:

“This strategy serves as a guide for government, industry and research institutions to further develop the sustainable production of Manitoba’s renewable resources. It will coordinate all our efforts to grow and sustain a vibrant bioproducts industry that creates good, green jobs and diversifies the rural economy.”

Growing Green: The Manitoba Bioproducts Strategy, p. v [Emphasis added]        

Manitoba’s other key sectors would benefit from a similar approach.

The website for Manitoba’s Department of Entrepreneurship, Training and Trade provides information pages for 21 key sectors (Click here to access the main page for all 21 sectors).

While we did not look at every sector, what we did review suggested the webpages are a good resource for listing key partners and programs. However, compared to the Bioproducts Strategy, the pages do not provide a comprehensive and strategic review of each sector.

As well, much of the information describing the sectors was meager and dated. For example, this is the sum total of the ‘highlights’ section relating to one of Manitoba’s most important and dynamic sectors, Information and Communication Technologies:

  • Winnipeg’s Frantic Films, with five-year revenue growth of 2,035%, was listed for the third consecutive year in PROFIT magazine’s 2006 Top 100 ranking of Canadian companies. Frantic Films also made the rankings of the 2006 Deloitte Canadian Technology Fast 50 – a listing of the 50 fastest growing technology companies in Canada.
  • Winnipeg’s Emerging Information Systems Inc. (EISI) is the largest financial planning software developer/vendor in North America. EISI was the winner in the software vendor category of the 2006 Financial Planning Award by CPA Wealth Provider. Winners of this award are companies that demonstrate leadership in innovation, efficiency, initiative, and growth in the financial planning area. EISI has also been listed twice on the annual Branham 300 list of top Canadian information technology companies (2005 and 2004). The Branham 300 is considered one of the most comprehensive sources on tracking the health of the Canadian Information Technology industry.

[Underlined emphasis added]

Further, while the Government is engaged in cutting-edge and exciting initiatives to help our key sectors, information about those efforts is getting lost in a sea of ‘generic’ government reporting.

For example, the 2009-10 report of the Department of Innovation Energy and Mines mentions the following:

  • Science, Innovation and Business Development [SIDB] supported the Market Access Program (MAP); a pilot project led by the ICTAM. MAP is a $1.8 million project that creates and disseminates, in an accessible way, a domain of knowledge to assist Manitoba companies in raising their level of readiness to enter into trade, technology partnering, and export activities in the United States. (p. 16)
  • The Competitive Intelligence Resource Centre Concept Validation (CIRC): SIBD supported an ICTAM led project this year to develop and validate the operating model for a CIRC. CIRC is proposed to provide briefing and research services, using various methods to collect data for continuous, subject specific online reports. The Centre would be a source for information about Manitoba’s ICT sector, its composition within the Manitoba market, human capital development, business performance and competitiveness, and the sector’s contribution to economic growth.  (p. 17)
  • Manitoba Interactive Digital Media Fund (MIDMF): In 2009/10, $500,000 was allocated to MIDMF. The objectives of MIDMF are: 1) to provide recoupable financial support to Manitoba companies for the development, production, and marketing of high quality, original, Interactive Digital Media products that are intended for the general public; 2) to raise the profile and presence of Manitoba’s Interactive Digital Media creators in both domestic and international markets while providing opportunities for professional development; and, 3) to assist in the growth and development of a Manitoba Interactive Digital Media production and distribution industry that is competitive in international markets. (p. 17)

We could not find any reference to these initiatives on the appropriate sector page.   

Individual sector reports similar to the Bio-products Strategy would serve as a guide for government, industry and research institutions to further develop the strategic growth. It would also coordinate all efforts to grow and sustain the sector and enhance transparency, accountability and strategic direction. Putting annual reports on the sector page would also eliminate the need to change the body of the main page as the sector evolves.   

The reports would clearly assist those who are directly involved in the sector. Incredibly, in this digitized, connected age that may just be the tip of the iceberg when it comes to the value of these reports.

a) The Power of Crowdsourcing

In “Crowdsourcing: Why the Power of the Crowd is Driving the Future of Business”, Jeff Howe talks about InnoCentive, a website where the likes of Eli Lilly, Boeing, DuPont and Proctor & Gamble post their most difficult scientific problems so that anyone can take a shot at solving them for prizes.

Howe spotlights Ed Melcarek, one of InnoCentive’s most successful problem solvers. Melcarek doesn’t work for any of the companies connected to the site; he just logs on from time to time to see what strikes his interest.

This is a nice enough story about the power of crowdsourcing – open up challenges to the public and they will help you solve them. But here is profound ‘kicker’ number one – Melcarek solves chemistry and biology problems but his training is in physics and electrical engineering. Indeed, it is exactly because of that different perspective that he is able to solve those problems.

Melcarek is part of a larger trend. A study of InnoCentive found the odds of a solver’s success increased when they were looking at problems in a field in which they had no formal expertise.

Here is profound ‘kicker’ number two:

“… a full 75 percent of successful solvers already knew the solution to the problem. The solutions to the problems in the study – many of which, recall, had stumped the best corporate scientists in the world after years of effort – didn’t require a breakthrough, or additional brainpower, or a more talented scientist’s attention; they just needed a diverse enough set of minds to have a go at them.”

Jeff Howe, “Crowdsourcing: Why the Power of the Crowd is Driving the Future of Business”, p. 152

This supports F.A. Hayek’s notion that progress often lies not in acquiring new knowledge, but in aggregating and utilizing the knowledge we already have.       

Imagine if the sector reports included an analysis of current challenges and then the business associations shared this information and distributed the reports to their members. Imagine what we could accomplish if we fully leveraged that which truly sets Manitoba apart – our incredible diversity – to bring known solutions in one sector into contact with challenges currently perplexing another sector.

b) Chance Favours the Connected Mind             

Connectivity is a powerful tool for solving new problems with old ideas, but it is also a great facilitator of new ideas.

Steven Johnson, author of “Where Good Ideas Come from: The Natural History of Innovation”, suggests a new idea is the result of a network rather than a single act. Johnson’s research shows that the chance for innovation and creativity substantially rises in an environment where ideas connect, fuse and recombine.

In his own words:

“What kind of environment creates good ideas? The simplest way to answer it is this: innovative environments are better at helping their inhabitants explore the adjacent possible, because they expose a wide and diverse sample of spare parts – mechanical or conceptual – and they encourage novel ways of recombining those parts. Environments that block or limit those new combinations – by punishing experimentation, by obscuring certain branches of possibility, by making the current state so satisfying that no one bothers to explore the edges – will, on average, generate and circulate fewer innovations than environments that encourage exploration.” 

Steven Johnson, “Where Good Ideas Come from: The Natural History of Innovation”, p. 41

It is a far ranging and at times circuitous presentation, but Johnson elegantly and engagingly illustrates these principles in a video of a presentation he made at TED:

 

Imagine the innovation and creativity that could be spurred if you produced sector reports that identified not only challenges but the latest developments and breakthroughs and we cross-pollinated those ideas with the help of the business associations and post-secondary institutions to a broader audience. Imagine the power of doing that in Manitoba, Canada’s most diverse province.

2. Embark on Strategic Tax Relief:

Our recommendation for strategic tax relief is not to be taken as a criticism of the Government’s tax policies to date. We fully acknowledge that this Government has provided the most extensive tax relief (along with the largest increases in spending) in the history of our province. 

Here are just a few examples of tax relief undertaken by you that we have publicly applauded:

  • Committing to cut the general Corporation Income Tax by almost 30 per cent;
  • Making the Manufacturing Investment Tax Credit 70 per cent refundable;
  • Eliminating the general Corporate Capital Tax and the Small Business Tax; and
  • Introducing a number of tax-credits to facilitate co-op education, apprenticeship training, the manufacture and use of green energy equipment, angel investing, community investing and more. 

The major aspects of your tax vision were completed by 2010. Therefore, the time is ripe for a new tax vision.

Fiscally challenging times and limited finances mean this new tax vision must be strategic. Thus, while some call for a reduction of all taxes it is important to remember that not all taxes are created equal. 

For example, we often hear a call for broad-based income tax relief. Looking at an interprovincial comparison of total direct taxes prepared by British Columbia’s Ministry of Finance helps put this issue in perspective (although the comparison listed all the provinces we are focusing on Alberta, the jurisdiction with the lowest taxes, to make our point):

Tax Costs: Manitoba Compared to Alberta*

Demographic Manitobans pay (+ or -)
Two income family of 4 earning $90,000 + $5,212
Two income family of 4 earning $60,000 + $3,944
Unattached individual earning $80,000 + $6,340

* Source: 2011-12 British Columbia Budget and Fiscal Plan pp. 89-90.

This comparison confirms Manitobans pay more than their Alberta counterparts, but we find it hard to believe that anyone earning $60,000 and up would move to Alberta to save between $6,400 to $4,000 a year in taxes. Moving for that reason is all the more dubious when one factors in Alberta’s higher cost of living.    

Simply put, Manitoba’s challenge isn’t how we tax incomes between $60,000 to $100,000; our problem is we don’t have enough people earning between $60,000 and $100,000.

If the goal is to grow great jobs, jobs that pay people more, there are two clear strategic priorities for tax reform in Manitoba:

a) tax relief to ensure that low income Manitobans are not unduly hampered by our tax regime as they ‘move up the economic ladder’; and 

b) eliminate profit insensitive taxes that penalize businesses for investing in equipment, ideas or people.    

We will now discuss each of these priorities in a bit more detail.  

a) Tax Relief to Ensure that Low Income Manitobans Are Not Unduly Hampered as They ‘Move up the ‘Economic Ladder’:

With major initiatives like ‘All Aboard’ and ‘Rewarding Work’, this Government should be commended for its efforts to help low income Manitobans move up the economic ladder.

The Manitoba Chambers of Commerce will continue to work with the Government and poverty groups to both monitor and advance those efforts.   

We remain concerned about the possibilities of tax clawbacks to Manitobans climbing out of poverty and wish to take this opportunity to again raise the possibility of additional tax relief for low income Manitobans, perhaps in the form of a Working Income Tax Benefit (WITB).

As you know, in 2007 the federal government introduced the WITB to remove barriers to work, often termed collectively as the “welfare wall.” The WITB is a refundable tax credit offered to low-income earners as a supplement to low earnings from employment.

The Ontario Task Force on Competitiveness, Productivity and Economic Progress discusses this issue and suggests that the WITB was not working well in Ontario as it did not fit well with the structure of their income security system.[2]

The 2007 Manitoba Budget spoke of a new Manitoba benefit which would complement the federal WITB, but we are unaware of whether the benefit was announced and, if it is in place, how effective it has been. 

b) Eliminate Profit Insensitive Taxes That Penalize Businesses for Investing in Equipment, Ideas or People:   

If the goal is to equip businesses with the ability to maintain great jobs, it seems we should focus on the elimination of taxes that are not only profit insensitive, but actually penalize businesses for investing in capital, ideas or people.  

What we are seeking at this juncture is the Government’s commitment to eliminate taxes that are the greatest impediment to creative and well-paying jobs.  

Once those taxes are targeted, the specific path of implementation will of course depend on the availability of revenue. We certainly do not endorse running a deficit to fund tax relief.

When it comes to profit insensitive taxes that penalize Manitoba businesses seeking to invest one tax deserves special mention – the Payroll Tax.

The Payroll Tax remains a significant concern for our members. It was again the focus of a Resolution adopted by our members at our AGM, the sixth consecutive time this has occurred.

The Government moved on the Payroll Tax in the 2007 Budget, increasing the exemption from $1 million to $1.25 million and raising the second threshold from $2 million to $2.5 million.

While this initiative was certainly a welcome step, it needs to be put into context:

  • Prior to the 2007 Budget, the Payroll Tax had not been reduced for nine years;
  • The full-year cost of the 2007 Budget’s Payroll Tax reduction was $7 million, the third smallest cost among the new business tax measures introduced by the 2007 Budget. In fact, it was less than half the cost of the 2007 Capital Tax reductions, $10 million less than the 2007 single industry “Film and Video Production Tax Credit extension” and $87 million less than the 2007 Manitoba Tuition Fee Income Tax Rebate;
  • Bringing in $378 million in revenue in 2010, this ‘tax on jobs’ is now the third largest source of tax income for the Manitoba Government, greater than the revenue from the profit-sensitive corporate income tax ($247 million);
  • Revenue from the Payroll Tax has grown by $49 million since the 2007 Budget;
  • Since 2007 the Minimum Wage has grown by 19% and Manitoba’s average weekly wage has grown by 7% (one wonders how much it would have grown if we did not have a tax on wages), yet the level of wages that trigger the Payroll Tax has stayed constant.    

“Create jobs” was one of three taglines on the cover of the 2010 Budget.

Your 2010 Budget speech identified three elements in relation to “Stimulating Economic Growth”:

  • Infrastructure projects to create jobs;
  • Expanding education and training to make sure Manitoba has skilled workers; and
  • Supporting research, innovation and environmentally focused projects.

The tie that binds all three of those elements is jobs – highly skilled and therefore high-paying jobs.

It is counter-productive to work so hard to nurture valuable skills, to invest so much to spur job growth, and then hit our businesses with a profit-insensitive job tax when they go to hire more Manitobans or pay them more.    

c) A Broader Tax Vision:    

The specific tax initiatives we are suggesting – focused tax relief for low income Manitobans and the removal of profit insensitive taxes on investment – combined with tax relief you have already undertaken will go a long way in addressing the most conspicuous drags on Manitoba’s ability to grow great jobs.

The time would then be right for a substantial ‘rethink’ of Manitoba’s remaining tax regime, one that engages both our community and our experts in ‘big picture’ and even ‘out of the box’ thinking about not just our level of taxation but the kind of tax mix that would optimize our ability to grow great jobs.

This fundamental review of Manitoba’s tax regime should consider issues such as:

  • How do other jurisdictions tax; what insights may be gained therein; and how, if at all, could these insights be applied to Manitoba? For example, it has been suggested Denmark and Sweden have high rates of tax but in a way that motivates business investment.[3];
  • Are we best served by a regime that taxes income or consumption?;
  • Should personal taxation be based on lifetime earnings?[4]
  • What impact would eliminating the corporate tax have, including the long-term effect on tax revenue and the patriation of earnings by foreign companies?[5]

Roger Martin, Professor of the Rotman School of Management, recently issued a cogent and compelling call for strategic tax relief. While Martin targets the American context, his words are germane to the issue at hand and warrant reproduction in their entirety:

Roger Martin

“Tax arguments tend to revolve around level: They’re either too high or too low. As these arguments quickly deteriorate into ideology – high is left and low is right—we generally get nowhere useful.

Part of that is because, economically, high/low is a less consequential dimension than smart/dumb. The question should be: Is our tax structure smartly structured? And the answer for America is definitive; it has one of the dumbest tax structures in the developed world.

What makes a tax structure smart or dumb? Put simply, a dumb tax structure discourages activities that generate prosperity (and with it a big tax base) and encourages activities that do not. A smart tax structure does the opposite.

Since the prosperity and the size of the tax base of an economy is driven by the capacity of its corporations to invest in creating high-productivity and therefore high-paying jobs, a smart tax structure provides minimal discouragement to corporate investment. The higher the tax burden on corporate investment, the lower the incremental investment in becoming more competitive and productive, the fewer high-paying jobs created and a smaller the tax base in turn. The smaller the tax base, the higher the tax rates needed to raise a given level of revenue.

So even though the US has a low level of taxation overall, it takes a large bite from corporate investment. That is a watermark of a dumb tax system. And it stems from a category error in logic. Progressive taxation philosophy, as applied in America, holds that poor people should pay low taxes, middle class people should pay medium taxes, rich people should pay high taxes and, since corporations are like really rich people, they should pay really high taxes. But corporations aren’t people. They are legally-constructed entities whose primary economic purpose is to create high-paying jobs (by, of course, providing useful goods or services). If they succeed, one by-product is for them to be in a position to pay dividends to their shareholders – who are taxed on those dividends.

Countries like Denmark and the Netherlands have a profoundly different – and smarter – taxation philosophy. They keep their taxation of corporate investment very low (18% and 16% respectively) in order to encourage corporations to invest, and if a high-earning citizen wants to enjoy life in Belgium or Denmark, the government will tax them relatively highly for that pleasure.

France, on the other hand, recycles 43% of its economy through the tax system and imposes the highest taxation on business investment in the developed world at 34%.

The chart begs the question: How do the countries with low taxation of corporate investment fund themselves? The answer is, with the smartest tax vehicle on the planet—the value-added tax (VAT). A VAT is a tax on consumption – i.e. it makes consumption more expensive than would otherwise be the case. Rather than discouraging the production of future growth and prosperity, VAT discourages the consumption of current prosperity. In a world increasingly concerned with sustainability, the VAT looks even smarter.”

“Smarter taxes survey: A global tour of policies that work” The Economist  

3. Expand your Innovation Agenda to Include Creativity 

Innovation is crucial. We applaud your focus on innovation and the creation of Manitoba’s Innovation Council. Indeed, the Manitoba Chambers of Commerce was one of the organizations that recommended the creation of the Council and we eagerly await the publication of the Council’s recommendations.

As well, it cannot be denied that there is a huge symmetry between ‘creativity’ and ‘innovation’ – to the point that they are often used interchangeably. 

In fact, when the Council was formally announced on April 6, 2009 Minister Rondeau stated:  

Minister Jim Rondeau

“The council will lead the development and implementation of the strategy to keep the province’s economy strong by capitalizing on Manitobans’ ability to transform creative, cutting-edge ideas into long-lasting economic advantages.” [Emphasis added]          

However, for all this symmetry there is often a scientific connotation to ‘innovation’ – a bias towards the fields of science, technology, engineering, and mathematics (STEM), that excludes or at least overshadows the creativity that applies to so many fields outside of STEM.

STEM is not for everyone and to espouse an agenda, however unintentionally, that excludes or does not resonate with Manitobans that have a creative bent would be a tragedy.        

Sir Ken Robinson, an author and Ph.D., has a short video on this topic. While even he interweaves the concepts of creativity and innovation, his warning about a focus on the STEM disciplines is clear:

Increasingly, experts and pundits alike are recognizing the benefits of targeting creativity as well as innovation. Consider this quote from :

Pic by Brett Ryder

“Studying the art world might even hold out the biggest prize of all—helping business become more innovative. Companies are scouring the world for new ideas (Procter and Gamble, for example, uses “crowdsourcing” to collect ideas from the general public). They are also trying to encourage their workers to become less risk averse (unless they are banks, of course). In their quest for creativity, they surely have something to learn from the creative industries. Look at how modern artists adapted to the arrival of photography, a technology that could have made them redundant, or how William Golding (the author of “Lord of the Flies”) and J.K. Rowling (the creator of Harry Potter) kept trying even when publishers rejected their novels.”

“The Art of Management: Business has much to learn from the arts” Schumeter, The Economist, February 17, 2011

Steve Jobs put it another way:

“It’s technology married with liberal arts, married with the humanities, that yields the result that makes our hearts sing.”

When we asked Seth Godin, renowned author and business strategist, to comment on this issue he replied:

“I think they’re different flavors of similar approaches.”

There is a reason we refer to some people as artists and others as scientists.

Giving creativity equal billing in your innovation agenda adds a flavor that will substantially broaden the appeal of what you are doing. It will also make explicit the different nuances in how the arts and sciences generate new ideas and how each can enrich the other. 

CONCLUDING REMARKS:

We reviewed last year’s submission in preparation for this year’s and found it still perfectly summed up our views.  We were reluctant to repeat it verbatim but then it occurred to us: circumstances, the swirl of events and innovations will change; but our focus, our perspective, if correct, should remain a constant – like a compass that guides a sailor in stormy seas.

Here then are our words from last year. In defining the challenge of our time we believe they stand the test of time:       

Professor Michael Porter is a leading authority on competitive theory. He is such a luminary in the field the Harvard Business School and Harvard University jointly created the Institute for Strategy and Competitiveness to further his work. Organizations like the World Economic Forum seek out his advice.

Porter was asked what jurisdictions can do to successfully compete in a global age. The usual suspects are things like low taxes and great infrastructure, and yes, Porter did indicate that such things are important. But here is what he said were the keys to successfully competing in a global age:

“… the enduring competitive advantages in a global economy lie increasingly in local things – knowledge, relationships, motivation – that distant rivals cannot match.” 

The good news is our fate is in our own hands. The bad news is we have no one to blame but ourselves if we fail to maximize our potential and lay the foundation for every Manitoban to obtain a great job – a creative job that by its very nature is engaging and well-paying.

A year ago our Pre-Budget submission said:

“It may be hard to believe at this juncture, but the turmoil of the financial markets will pale in comparison to the momentous shifts that are taking place and continuing to evolve in the creative globalized economy.”   

Our world is embarking on a seismic shift that will rival the sweeping changes that followed the move from an agrarian to an industrialized economy. The clock is ticking as every jurisdiction grapples to find the recipe for prospering in an economy that increasingly rewards creativity.

In the words of the Martin Prosperity Institute:

“There is no magic bullet. But sooner or later some jurisdiction will determine how to tap more fully the creative talents of much broader segments of its people – and it will gain a distinctive advantage. Japan’s auto manufacturers plumbed the knowledge and creativity of their shop-floor workers and gained a tremendous competitive advantage. Ontario’s own Four Seasons has done so in bringing guest service to new, world beating levels, thanks to empowered front-line employees.”[6]

The Government of Manitoba has much to be proud of. In many ways it has laid a good foundation to enable Manitoba to prosper in a creative economy.

However, to build on that foundation, to take the next step in realizing Manitoba’s potential, it must embrace the remaining aspects of the Great Jobs Agenda.

The Manitoba Chambers of Commerce thanks you for the opportunity to make this submission.   


[1] “Ontario in the Creative Age”, Martin Prosperity Institute, February 2009,  p. 31, http://martinprosperity.org/media/pdfs/MPI%20Ontario%20Report%202009%20v3.pdf

[2] “Rebalancing priorities for prosperity”, Fourth Annual Report, November 2005”, P. 52

[3] “Rebalancing priorities for prosperity”, Fourth Annual Report, November 2005, p. 44. Expert Panel on Business Innovation, “Innovation and Business Strategy: Why Canada Falls Short.”

[4] “Rebalancing priorities for prosperity”, Fourth Annual Report, November 2005, p. 46

[5] “Rebalancing priorities for prosperity”, Fourth Annual Report, November 2005, p. 45.

[6] “Ontario in the Creative Age”, p. 6

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