Tuesday, February 5, 2008

The Need to Adjust in Tough Economic Times


In the Town of Hearst, economic pressures relate to the need to enhance and diversify the local economic base. This need has been propelled to the forefront by a variety of factors. The forestry industry, which has traditionally been the driving force of Hearst’s economy, is in transition. This is attributed to a stiff international competition from Russia and China, a high Canadian dollar, increasing energy costs and the Canada-U.S. softwood lumber crisis. In light of Hearst’s dependency on primary resources, the Town is emphasizing the need to diversify its local economy to more effectively compete with other communities in attracting business investment. This changing economy constantly forces the community to adjust. This adjustment is without doubt a long and agonizing process that does not always guarantee success. Adjustment efforts focus on finding solutions to job losses. The focal point to finding answers to economic downturns always relies on saving existing industries. Today, the business climate is different. Not only the industry is in decline, but it is in the verge of changing dramatically. Resource based economies tend to rely on primary transformation leaving value added opportunities undeveloped. It is without doubt an opportunity for the Hearst Area Economic Development Corporation to act in a proactive way to this situation. The community has to find short term solutions to shift towards a long term vision. The population must think globally and act locally, and most importantly take steps in a coherent way.

In 2006 the Hearst Economic Development Corporation gave birth to the Bio Com project. This integrated approach would help the community to move forward in the new bio-economy. It encompassed critical factors that enabled a healthy community. It also promoted change and the need to make adjustments. Changing attitudes and values within a community is a lengthy and difficult task. Nevertheless, it is critical to maintain in order to achieve sustainability.

The Bio Com Committee was steered by local people who recognized the need for change and were willing to initiate action. The purpose was to create willingness and motivation for change by building the necessary understanding, acceptance and commitment to change.
The forest industry is in transition. Status quo is no longer acceptable, primary producers are being shaken to its core. Forest industries are no longer investing, instead they are liquidating assets, closing century old plants, new plants, and unproductive plants and cancelling new projects. This is a common trend facing North Eastern and North Western Ontario. The results are, job losses and significant downsizing of communities.
Changes are occurring throughout the world. All communities are experiencing change and need to make adjustments. Community leaders must be involved to help deal with and direct these changes. Community leaders and residents have a choice to either plan for change or to let it occur as it will.

On April 13 and 14th, 2007 the Bes Conference was held in the community of Hearst, Ontario. The objective of the conference was to offer participating communities of Northern Ontario and North Western Québec the momentum of reinventing themselves and plan their own future.

The theme of the conference was “Sustainability and growth of forest communities: The challenge in harmonizing bioeconomy, forest ecology and community resilience.

A total of 380 delegates participated at the conference with representation from residents, politicians, students, industry leaders and governments.

The BES Conference participants benefited from the experience and expertise of leaders and practitioners in sustainability, bioeconomy, ecology and climate change, as well as community resilience. These leaders and practitioners came from across Canada and the United States (New York, British Columbia, Quebec and Ontario). This unique networking opportunity has enabled participants to start tracing the road towards the future.

Forest companies along with communities of Northern Ontario and Quebec are experiencing economic and structural changes. Communities are forced to look at new ways of dealing with these ongoing changes.

The communities are at a crossroad. It is time to seize all available opportunities. In this context of change, communities that are healthy, green, sustainable, innovative and open to change will have a promising future.

Sustainability is at the center of this changing economy, and the three pillars that serve as the foundation are the community, the bioeconomy and the ecology.

The Bio Com project, its activities and the BES conference enabled the community to establish key objectives for the community moving forward. As the vision of Bio Com states; “to create an innovative cornerstone community for the world of tomorrow” the main goal moving forward is to have a healthy sustainable community by;

a) Developing a clear community vision;
b) Increasing citizen involvement and participation;
c) Demonstrating leadership;
d) Improving community resilience;
e) Rethinking the use of our natural resources;
f) Building capacity towards innovation and education;
g) Promoting entrepreneurship; and
h) Paying attention to our youth.


Overall the BES conference played an important role in uniting communities and industries. The working sessions confirmed an increasing willingness to work together towards a common vision.

This conference also offered the forest industry the opportunity to discover new ways of using and/or reusing our resources. It also demonstrated the importance of including communities, as a critical factor leading to a better economy.

Monday, February 4, 2008

Hockey Tournaments - A Great Economic Impact

McDonald’s Hockey Tournament

An Economic Development Impact for the Community of Hearst and Area (dollars)

The following is an economic development impact analysis for the Hearst McDonald's hockey tournament held this past weekend. A total of 24 teams participated at the event with an average of 15 players each team. It is estimated that a total of 33 persons were associated with each team.

An expenditure of $114,480 associated with "McDonald's hockey tournament” will generate income, employment and tax benefits in Community of Hearst and area. This expenditure will sustain a total sales volume of $156,219, a total income of $69,708 and total wages and salaries of $48,179. Wages and salaries will account for 69.1% of GPI (Gross Provincial Income) impact.
For every dollar of expenditure a total of $1.36 will be generated in gross sales by "McDonald's hockey tournament " in Community of Hearst and area, this is generally known as the sales multiplier. Also, for every dollar of expenditure a total of $0.61 income will be sustained by "McDonald's hockey tournament” in Community of Hearst, Mattice-Val Coté, Constance Lake, Hornepayne. The latter is commonly known as the income multiplier.


A total of $48,179 of labour income will be generated in Community of Hearst, Mattice-Val Coté, Constance Lake, Hornepayne. This supports a direct effective wage per employee of $29,767 and total effective wage of $32,119. "McDonald's hockey tournament” sustains lower wages than those paid off-site, and "McDonald's hockey tournament” appears to generate above average wages in Community of Hearst, Mattice-Val Coté, Constance Lake, Hornepayne.
Wages & Salaries(dollars)

"McDonald's hockey tournament” is credited with sustaining a total of 1.50 years of permanent full-time job equivalents. This translates into a total of 13.10 jobs per one million dollar of expenditure. For every direct job in the economy at large, an additional 0.36 jobs are sustained.
Employment(person years)

Imports will be required to sustain "McDonald's hockey tournament ". $6,331 will come from other provinces and $14,154 will come from other countries.

Taxes will accrue to all levels of government as income is generated and sales are made to sustain the new demand. A total of $30,512 will be collected; of which the federal governments' share is $16,734, whereas the provincial government's share is $12,881, and the local governments' is $897. On a per dollar of expenditure basis, 27 cents are collected in taxes, 15 cents go to the federal government, 11 cents to the provincial government, and 1 cents to the local government.