Economic Development
Three core components of Economic Development
1) Business Attraction
i.
ii.
iii.
iv.
Marketing & Promotion
Trade Shows
Sector specific initiatives
Statistical information
2) Business Retention
i.
ii.
Labour force recruitment
Local, Regional, Provincial & Federal Regulations
3) Business Expansion
i.
ii.
iii.
Export markets
Network connections
Land and building search
Why Business Retention and
Expansion?
• Existing businesses in a community are responsible for approximately
80% of future employment growth
• Happy existing businesses help attract new businesses
• Identify problems and new opportunities
• Gain a better understanding of the status of the local economy
• Strengthen linkage between local government and business
community
• Retention visits lead to business expansion initiatives
• Identify companies at risk of closing/relocating
• Identify barriers to growth
Background
• Economic Development Strategy identified the need for a
BR+E Program
• Project supported by City of Vernon, Community Futures
and the Province of BC
• Initial target sectors included Manufacturing & Technology
• Hired consultant to complete 100 Surveys
• Executive Pulse – largest BR+E database provider in North
America
• Phase 2 – Downtown retail & professional services
• Phase 3 – Agricultural Sector
Where did we interview/
Source of Interviews
1
6
5
Vernon
6
Rural Areas
9
Spallumcheen
57
17
Coldstream
Enderby
Armstrong
Lumby
BR+E
FINDINGS
Years in Business
Years In Business
Percentage
< One Year
3%
2-4 Years
7%
5-9 Years
12%
10-14 Years
12%
15>
66%
Life Cycle
Life cycle stage of firm's primary product/service:
Declining
Maturing
Growing
Emerging
0
10
20
30
40
50
60
Succession Plan
Succession Plan
Yes
43%
No
57%
Labour
Over the past three years
• 43 percent of businesses have maintained a stable
workforce
• 36 percent of businesses increased their workforce
• 69% plan on increasing amount of full time
employees over next 3 years.
Total number of employees at the businesses surveyed
breakdown as follows:
• Full-time employees - 2,482
• Part-time employees - 169
• Temporary employees - 156
• Total employees - 2,807
Availability of Workers
35
30
25
20
15
10
5
0
High
Average
Low
• 51% ranked availability of workers from Average to Low
Quality of Labour Force
40
35
30
25
20
15
10
5
0
High
Average
Low
• 52% ranked quality between Average and Low
Stability of Labour Force
40
35
30
25
20
15
10
5
0
High
Average
Low
• Stability is ranked High
• 86% stated that the number of unfilled positions today
was stable
Skill Levels and Wages
Skill Level and Wages
Skill Level
(%)
Skilled/Professional
Wages
(PH)
53%
$29
Semi-skilled
24%
$19
Entry Level
20%
$14
• 48% of companies believe that the level they pay is greater than
others locally
• 20% of companies have problems retaining employees
Unfilled Positions
• 55% are having difficulties in finding employees
Job Type (difficulty on finding)
Business Administration
Clerical
Computer technology/programming
Machinery operators
Marketing
Plant operators
Sales
Skilled trade
Unskilled labour
Other
(%)
11
4
11
4
4
6
15
43
15
36
Other Key Labour Findings
• 85% of companies find employees locally (note: different than three
years ago)
• 51% of companies have a training budget for employees
• 58% of companies do not have a formal workplace training program
in place
• 87% of companies are non-unionized. Of those that are, 100% rank
relations as good or excellent.
• 74% of company employees are middle aged
Sales
Market Share
Increasing
Stable
Decreasing
24%
52%
24%
Sales
Historical Sales Trend
Facility
(%)
Within Industry
(%)
Increasing
56
21
Staying the same
20
40
Declining
24
36
0
3
Not applicable
• North Okanagan companies indicate that they are doing better than
the industry average
Sales
Source of Sales
International
15%
National
19%
Local (within 50
miles)
41%
Provincial
(balance)
25%
• 59% of company sales are located outside of geographic area
Export
• 48% have Export Sales Status
• Export Markets include USA, China, Mexico & Europe
Export Sales
Export Sales
(%)
Increasing
29
Staying the same
37
Declining
13
Not applicable
21
Facility and Equipment
• 58% own their facility (42% lease)
• 83% indicate that the condition of the current facility is good or
excellent
• Usage of facility
• 43% use more than 90% of facility
• 24% use 76-90%
• 20% use 51-75% and balance use less than 50%
• 87% rank equipment as good or excellent
• Usage of Equipment
• 33% use more than 90% of equipment capacity
• 25% use 76-90%
• 29% use 51-75% and balance use less than 50%
Facilities (expansion)
• 46% of companies have expansion plans within the next 12-18 months
• 68% indicate they have room for expansion at current site
• 74% of those planning expansion indicate that it will occur within the
North Okanagan.
• 53% of those planning expansion indicate that they will expand at current
site – balance will need to find new land or facilities
• Estimated total investment of those planning expansion is $58,000,000
• 215,000 sq.ft. of new space will be required to accommodate the
expansions
• 209 New Jobs will be created through Expansion
Facilities (expansion)
Expansion Restrictions
Broadband access
Finance
Identifying and accessing new markets
Lack of skilled staff
Lack of suitable premises
Local regulations e.g. zoning
Problems with DAs
Roads
Transport/freight
Warehousing
Other (please specify):
%
6
47
14
19
36
47
14
3
3
3
28
• Other includes – water restrictions, parking and global
economy
Services and Costs
Municipal and Regional Services
• Inspections and Licensing – 52% rank as average to poor
• Development Approval Process – 70% rank as average to poor
• Availability of Land – 73% rank as average to poor
Cost of Doing Business
• Permit Fees – 74% rank average to poor
• Land Costs – 83% rank average to poor
• Building Costs – 84% rank average to poor
• Leasing Space – 76% rank average to poor
• Taxes – 74% rank average to poor
Business Climate
Local and Regional Government
Excellent
Local/Regional
Government
(%)
4
Taxation
(%)
1
Good
18
18
Fair
50
46
Poor
26
29
2
6
100
100
No opinion
Totals
• Some concerns raised regarding both local & regional government
Business Climate
• dd
Better today
No change
Worse today
No opinion
Totals
Business Climate today vs
5 Year ago
(%)
Business Climate 5
years from today
(%)
20
69
16
22
61
6
3
100
3
100
• 71% overall had a positive attitude toward the community despite
some concerns
Strengths as a Place to do
Business
• Location
• Quality of Life
• Support from other businesses
• New focused economic development program
• Support services (Community Futures, Chambers of Commerce,
Vernon EDC)
• Large Customer base
• Workforce – dedicated employees
• Lifestyle can attract labour
• Support amongst businesses
Weaknesses as a Place to do
Business
• Location
• Lifestyle
• Workforce
• Local and Regional Governments (bureaucracy)
• Lack of Land and Facilities
• Non-supportive attitude to entrepreneurism and small business
community
• Expensive
*most of these were identified also as a barrier to growth
Other Findings
• 93% of companies were rated as having little to no risk of closing or
downsizing
• 29% of Manufacturing companies spend more than 3% of annual sales on
R&D
Recommendations
1) Review Local and Regional Government approval processes
2) Develop labour force recruitment Packages
3) Assist companies in recruitment process
4) Consider developing an HR website for use by companies seeking
employees
5) Complete a Land and Facility Inventory
6) Complete a BR+E Program for other sectors
7) Introduce companies to BC Trade & Investment representatives in USA,
Asia, and Europe
8) Create a Sector Alliance for Manufacturing
Questions
Kevin Poole
Economic Development Officer
City of Vernon
Tel: 250-550-3249
kpoole@vernon.ca
www.investvernon.ca