Local businesses need to become more competitive: McGuire

The local business community was treated to a hard dose of reality last Wednesday night when the co-chair of New Brunswicks self-sufficiency task force outlined a course of action that is expected to move the province towards economic prosperity.

Francis McGuire, the featured guest speaker at last weeks annual general meeting of the Greater Sackville Chamber of Commerce, told the Tantramar-area business crowd that they will need to hike wages over the next several years by at least 20 per cent to retain their workers.

In todays economy in New Brunswick, there are just not enough workers to go around, said McGuire. Wages will go up as employers compete for the workers that remain in the province, particularly when the refinery project gets under way in Saint John.

Whats particularly dramatic and what is staring everybody in the face is there is about to be a dramatic sucking sound that will hit New Brunswick real quick, he said. You, in Sackville, and the people of Bouctouche and the people in Bathurst are about to face the worst competition that theyve ever seen. If you think that Albertas bad, just wait until the Irvings start building the refinery in Saint John.

Within the first two years of its operations, the new refinery will need to attract between 5,000 to 7,000 workers, with an array of jobs available.

That wage inflation is about to sweep through the economy very quickly and within the next four to six years you will have to compete. Youre really going to have to think about how you invest in productivity and how youre going to put more money into mechanizations and technology; thats the only way youre going to survive.

McGuire, who heads New Brunswicks self-sufficiency committee launched by Liberal Premier Shawn Graham in January, has been solicited with developing a plan to take self-sufficiency for the province from conception to reality.

The task force has been outlining their views in a series of papers. Already, there have been three papers published on a number of key issues. These key issues include increasing population and labour force, productivity, rural and urban connections, export growth, and expanding the provinces existing corporate base.

The final report will be released next month and will combine information the task force has gathered through meetings, formal submissions and online discussions.

McGuire, who served as Deputy Minister of Economic Development and Tourism in New Brunswick during the McKenna era, said the province also needs to find new ways to attract larger companies to invest in New Brunswicks economy.

There continues to be this fascination between helping small business or big business. Thats an absolutely useless division of the economy, McGuire insisted. You should never think of the economy in terms of big and small. You should think of the economy in terms of export and support industries.

Export industries, no matter their size, bring in new money into a province, he explained.

All of the small businesses depend on that new money to come in, create new jobs and expand the (tax) base.

The economy also needs to provide more support to outside firms, not just local retailers, said McGuire.

Theres always this thought that communities should just support local businesses. Well I have news for you; that wont work. Local businesses, even when they grow, have a failure rate of 50 per cent within five years. When they are successful, they grow slowly.

More effort needs to be put into business attraction, he said.

If you dont get (more) jobs by bringing outside money into this economy, youre not going to make it.

The bigger companies provide a greater impact for the economy, said McGuire, including higher-paying jobs and quicker growth.