Opinion: Diversifying Alberta’s economy needs innovation, not ideology

The Alberta election on April 16 will be won or lost on the basis of how Albertans view its economy. A pivotal part of that is the health of the province’s associated innovation ecosystem.

In March, the Alberta Council of Technologies Society (ABCtech) and the Economic Developers Alberta (EDA) together surveyed more than 500 business and community leaders and academics about Alberta’s economy. The findings were troubling.

Members told us that Alberta’s economy is not diversified enough to weather shocks in the oil industry. And there is little evidence things are improving. Changes in the oil and gas industry have had a negative impact on every region and every industry and profession, and limited the ability to finance Alberta’s public services.

Respondents feel Alberta’s economic resilience remains weak, particularly in the Calgary region and northern Alberta, with the only meaningful improvement in southern Alberta since the semi-annual survey was introduced in 2015.

Alberta is vulnerable because it remains overdependent on its raw carbon industries and markets — particularly in oil and gas, and more recently agriculture. One need look no further than the devastating financial consequences farmers face as a result of the politically motivated trade dispute with China over our canola.

On the positive side, cannabis investments in southern Alberta are providing a rare ray of economic light.

Our economy’s vulnerability has been exposed by the many shocks hitting Alberta’s oil and gas industry — new shale technology in the U.S., the restricted access to markets, and energy self-sufficiency in the U.S.

Perhaps the most harmful impact of all, however, is the labyrinth of regulations, lack of social licence, and operational complexities that are driven by political ideologies.

All of these factors conspire to discourage corporate investment, and, as a result, we are seeing a decline in the creation of meaningful full-time jobs, continued layoffs and the highest unemployment rate in the country.

In the survey, we asked what role government should play in diversifying the economy. Respondents listed, in order: incentives for small business innovation; new trade agreements for Alberta products and services; promoting entrepreneurship and small business startups; and only then investing in research for long-term job creation.

Fully 87 per cent of members also agreed that an effective innovation ecosystem is essential to diversifying Alberta’s economy — something that is lacking now.

What can be done? Respondents told us that party ideologies have failed. Instead, Albertans need vision and leadership.

Alberta governments in the 1980s spent billions of dollars on diversification projects and failed. Then, the province was forced to spend years in debt-bailout. The incumbent government has proposed value-added processing of oil and gas and pipelines. That may — or may not — improve revenues, but does nothing to wean Alberta off oil.

Instead, Alberta’s leaders need to recognize that technology is changing everything, everywhere, and fast. For that reason, it is vital to support innovation with policies and the development of collaborative networks for creating a new economy in Alberta. Here is a roadmap:

• Energy transition. Accept energy crises as opportunities for a transition and adopt a pathway to fusion and associated technologies by 2030.
• Use data to improve health care. Commit to employing individual data to better serve individuals.
• Support the transition to autonomous transportation. Provide incentives for pilot projects in autonomous transportation for cargo, logistics and people.
• Encourage the development of an industrial hemp industry including mobile processing, regional manufacturing, and long-term trade agreements.
• Finance the future. Recognize the increasing value and role of intangible assets and encourage Albertans to invest in the new Alberta.
• Education reform. Give youth a voice in expressing their views of the future of work and their well-being AND encourage their development of relational skills.
• Provide leadership by: monitoring the effectiveness of Alberta’s innovation ecosystem, and constantly advocating for positive change.

Technology has changed the world so completely, the solutions of the past are irrelevant today. If we embrace change and adapt, our province can once again be a leader for the world.

Perry Kinkaide is founder of the Alberta Council of Technologies Society.