Randy Mowat is senior vice-president of marketing at MNP in Calgary.
What’s your sense of where the Calgary economy is at these days?
Mowat: My sense is that the Calgary economy is in a negative space in the minds of most people – especially the media and those in sectors hit hard by the downturn.
And that’s fair and true. Every morning when the sunlight hits the windows of the buildings downtown, I can see the empty floors of office space across the core. When I walk through the Plus 15, I see considerable empty commercial space that once housed small business – everything from boutique restaurants to hair salons and business services. This is real, and this hurts.
These empty office spaces are putting an unsustainable tax load on the back of the business community which, left unchecked, will cause more negative pressure on the Calgary economy.
But there are also people out there who say it’s not as bad as some people think – and that may be true for some segments. I recently attended a business function attended by private business and entrepreneurs and asked this question of them. They all have a view that, yes, there are headwinds, but we can make it through and are willing to keep trying, which is typical of the determination and perseverance of Calgarians.
The Calgary economy has been facing and continues to face tougher times than we’re used to. We don’t like it, but I hope we can leverage the Calgary entrepreneurial spirit that built this city and province. Though for some, it’s tough out there.
You work downtown. What’s the mood of business owners and professionals?
Mowat: The people I talk with in downtown business are true entrepreneurs – resilient, proud, never-give-up kind of folks. But they’re concerned and currently in a holding pattern type of mindset. They’re trying extremely hard to keep the business operating, but are feeling the pressures of the tax burden, increased minimum wage levels and the sheer loss of consumer traffic downtown.
The offices that are now empty were once filled with their customers. They all desire a system that gets out of their way and a system that creates an environment where they can succeed.
What are the biggest challenges Calgary business owners face in this market?
Mowat: I think some of the biggest challenges business owners are facing are due to the downturn in the energy sector and unfortunately self-inflicted hurdles from government policies and decisions. One of our biggest challenges is our over-engineered regulatory systems – it’s too hard to get things done around here now.
Another challenge is the increasing tax burden on downtown business due to the 27 per cent vacancy levels (in downtown office space) and the regulations and red tape business owners are having to manoeuvre just to operate. Increasing operating costs due to minimum wage and carbon tax increases all contribute to business operating challenges.
These may not have had the same effect when the energy sector was in better shape, but when oil and gas prices are this low and consumers are closely watching spending, it adds to increased concern and diligent management by business owners.
What do you think it will take to turn things around from an economic standpoint in Calgary?
Mowat: We need some good news. We need to see there is a light (that’s not a train) at the end of the tunnel. We need policies that don’t make business unprofitable due to unreasonable costs.
We need to somehow ignite that famous Calgary spirit that built this city and province. We need strong leadership from within the business community to stand up and fight for policies that create an environment that supports business development and success.
We need to see more consumer and investor confidence in the Alberta and Calgary marketplace.
I think we need to have a mind shift from, ‘we are in tough shape and beaten down’ to one of, ‘this sucks, but we can make it!’
We have a very strong entrepreneurial community in Calgary that sees the glass half-full. We need to hear about them, celebrate and support them. Business builds communities and we need to support our business at home while the economy tries to recover.
Is Calgary in desperate need of diversifying its economy for the future growth of the city?
Mowat: Yes, but that doesn’t mean we walk away from our energy sector. We need to leverage the assets we have around us today.
We need a plan to attract and retain growth industries like technology innovation, agriculture and agri-food. Not to mention industries that add value to our energy sector and our many fine education institutions.
We need sectors that require the resources we have and can leverage our strong foundation of natural and human resources.
I think we can learn from other jurisdictions like Houston, Denver and others that have similar assets and have gone through economic hardships and have transitioned their economies.
– Mario Toneguzzi for Calgary’s Business