What BC businesses have to say about the Olympics, the provincial economy and the environment
There’s often no better way to gauge the pulse of the province than by talking to business owners. Our annual Destination 2010 Business Survey provides insight into what BC businesses think about the economic impact of the 2010 Winter Olympics, the challenging economic environment and environmental issues.
The Olympics: Golden opportunity or business as usual?
Four in five BC businesses continue to believe that the 2010 Olympics will benefit the province. However, when asked if the Olympics will affect their businesses, only 29 per cent expected a positive impact – the majority (64 per cent) anticipating that the Games will have no real effect on their bottom line. Not surprisingly, businesses in the construction and manufacturing sectors and companies with more than 10 employees had more optimistic expectations, with 42 per cent anticipating a positive impact compared to only 24 per cent of businesses with fewer than 10 employees.
The top three anticipated benefits are higher spending by visitors, increased real estate development and construction, and improved transportation infrastructure.
Labour issues remain a key concern
BC businesses frequently mentioned the lack of skilled employees as the key factor hampering their ability to stay competitive or grow.
What can the province do to ease some of the pressures faced by business owners? Expanding training programs for skilled trades remains their top priority, with 55 per cent saying that this initiative is very important to their ability to prosper. Approximately one in three businesses looked to other government-led initiatives, including the implementation of more flexible immigration policies to attract professionals and skilled labour, the completion of BC’s “gateway” transportation improvements, expanded trade relationships with Asia and India, and reduced US-imposed tariffs.
Consistent with prior years, BC businesses also continue to push for reduced corporate taxes to help them compete and take full advantage of the economic opportunities leading up to the 2010 Games and beyond. Other priority areas are harmonizing the PST and GST and reducing red tape and regulations.
Although the survey was conducted in mid-August – before the full emergence of the global financial crisis – BC businesses are definitely more pessimistic than in prior years about the state of the provincial economy.
The number of businesses that expect BC’s economy to decline over the next four years jumped to 25 per cent from just 7 per cent in 2007. This more negative outlook has resulted in reduced plans for new expenditures, with companies less inclined to expand their workforce, add new services or invest in new machinery or equipment. Still, 51 per cent of businesses surveyed expect their annual sales to grow (compared to 68 per cent in 2007), 40 per cent expect sales to remain the same between now and 2010, and 7 per cent predict a decline in revenues.
BC businesses and the environment
Environmental concerns are more prominent in this year’s survey. In 2007, 40 per cent of companies said they weren’t doing anything to reduce consumption or recycle; in 2008, that number has decreased to 33 per cent.
Just how green are BC businesses? While they are taking some steps, much more can be done. Recycling paper remains the easiest and most popular way for respondents to reduce their environmental impact, and half of respondents are recycling items in addition to paper. Perhaps more importantly, one-quarter of businesses are trying to reduce consumption: for example, 13 per cent say they are reducing dependence on cars, using more efficient vehicles or choosing alternative modes of transportation, up from only 6 per cent last year.
The carbon tax is a contentious issue, with half of respondents voicing strong disapproval of the tax. Larger companies (those with more than 10 employees) were more likely to approve of the tax, as were companies located on Vancouver Island and along coastal BC.
Only 19 per cent of BC businesses were aware of the cap-and-trade legislation introduced last spring, which caps carbon emissions but allows polluters who exceed their cap to trade with or buy credits from other companies or pay an administrative penalty. One-third of businesses said they approve of this program, and four out of five did not expect to see much of a financial impact – either positive or negative – from it. The Destination 2010 Business Survey, a province-wide poll of 500 businesses, was conducted by the market research firm Synovate on behalf of CGA-BC. Results on the total sample of 500 are accurate to plus or minus 4.4 per cent, 19 times out of 20. The survey was conducted by telephone with business owners or senior management of companies ranging in size from one to more than 500 employees from across the province.