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Invest Indicators

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Business and Investment Activity

Capital investment spending in BC decelerated, but maintained a positive momentum in 2009, with the total value of investments proposed, underway, completed, or on hold expanding by 5.5%.[20] In the CDR, when comparing the fourth quarter of 2009 to that of 2008,  the value of major project investment rose marginally, from $6.1 to $6.2 billion.

According to the December 2009 BC Major Projects Inventory, ten projects were underway in the fourth quarter of 2009 in the CDR, with a total value of $2.1 billion. The most significant projects were:

• Trans Mountain Pipeline from Valemount to Burnaby ($1.5 billion)—construction commenced in 2006 and expected to be complete in 2011;
• Cariboo Connector highway project between Prince George and Cache Creek ($241 million)—started in 2005 and slated for completion in 2011;
• Canoe Mountain Resort near Valemount ($100 million)—construction underway in 2007 with development to continue over a 13 year period;
• Gibralter Copper Mine Expansion near Williams Lake ($62 million)—construction started in 2006 and proposed to wrap up in 2010; and,
• PGP Bio Energy Project in Prince George ($50 million)—started in 2009 with wind up of construction planned for 2011.

During the last quarter of 2009, there were a total of 26 projects in the proposal stage in the CDR, valued at $3.4 billion. Of these projects, nine (worth $1.3 billion) are slated to commence construction in 2010. The largest projects include: the Mount Milligan Copper/Gold Mine ($917 million); the Cancer Centre for the North ($103 million); and the Prince George Performing Arts Centre ($51 million).

The global financial crisis and tighter lending practices undoubtedly impacted the timing of some investment decisions throughout the year. For example, the $900 million Prosperity Gold/Copper Project near Williams Lake was supposed to commence construction in 2009, but that start date has been postponed.

Incorporations and Bankruptcies

Business incorporations and bankruptcies reflect commercial success or failure, a principal driver of the investment climate. Between 2008 and 2009, the number of business incorporations in the CDR declined from 557 to 440. Despite the recent drop, the CDR fared better than most other Development Regions. The hardest hit areas of the province were the Nechako, Northeast, and Thompson-Okanagan, which saw declines of 39%, 26.4% and 24% respectively. Every Development Region in the province experienced a loss in incorporations in 2009, resulting in a provincial drop of 12.1%.

Table 1-4: Business Incorporations and Bankruptcies, Cariboo Development Region, 2004 to 2009

Source: BC Stats and Office of the Superintendent of Bankruptcy Canada

In 2009, bankruptcies in the CDR reached their lowest level in more than a decade, falling to 35.[21] However, the CDR still ranked sixth among the eight Development Regions on this indicator. The Mainland/Southwest (11.6%) and the North Coast (20%) both saw bankruptcies increase, while the Northeast and the Nechako posted one year declines of 55.6% and 50% respectively.

Business Establishments

The number of business establishments in the CDR increased to 11,794 in 2009, an improvement of 0.8% from the previous year. Most of the gain was in sole proprietorships and operations with 1 to 19 employees. The economic downturn in the latter part of 2008 and through 2009 likely compelled many to choose self-employment in the face of layoffs or a lack of job security.

Table 1-5: Number of Business Establishments – all sizes, Cariboo Development Region, 2007 to 2009[22]

Source: Statistics Canada

Small business[23] plays a key role in job creation, and is a significant contributor to BC’s economy. BC is unique in the fact that more GDP (34%) is generated in this province by small businesses than in any other.[24] When looking at growth in Business establishments in 2009, the CDR ranked third among the Development Regions, after the Vancouver Island/Coast (1.4%) and the Thompson-Okanagan (1.2%). At the other end of the spectrum, the Nechako and Northeast saw their business establishments decline by 5.4% and 1.6% respectively.

Footnotes

20. BC Ministry of Economic Development, BC Major Projects inventory, December 2009. Note: Period of reference is fourth quarter 2008 to fourth quarter 2009.
21. Office of the Superintendent of Bankruptcy Canada.
22. Statistics Canada has changed its methodology in measuring business counts, thus the data reported here are inconsistent with figures reported in earlier editions of this publication. Previously, the concept of a ‘statistical establishment’ was the measure that was used. In 2008, the concept of a ‘statistical location’ was introduced with data back to 2007 available. The change to business location counts was made because they provide a better measurement of actual business units. Due to this change, the reported number of businesses will be higher than would be the case if the earlier framework was still in use.
23. In British Columbia, a small business is defined as one with fewer than 50 employees, or a business operated by a person who is self-employed and without paid help.
24. BC Stats, Small Business Profile 2009, October 2009 Edition.
25. They may have been laid off and awaiting recall, went on to schooling or upgrading, resumed as homemakers, retired, been seasonal workers in an off season who were not looking for work, or they were simply discouraged and gave up looking for work.