Where is our market going?
Sept 24, 2024
Over the weekend, I read with a mixture of interest and sadness, the story published in the Globe & Mail Report on Business about how Canada‘s middle class got shafted. This was the first in a series of essays called Prosperity’s Path, written by Dan Brenznitz. This week’s story lays out how we got into this crisis. Some key facts begin with the fact that Canadian median family income has barely changed from 1976 levels. He showed a chart that in 2022 constant dollars the middle class family income has moved from $64,700 in 1976 to $65,100 in 2022.
He also points out that over the past 45 years we’ve become the world’s most educated country. Canadians are hard-working and participation in the labour force among 18 to 64-year-olds is higher than in both the United States and the average for OECD countries. We have an impressive and extremely high-performing research and higher education infrastructure, and our businesses have enjoyed rising profits.
He points out in this very interesting article, that the most important thing for growth is innovation and innovation is not just the invention of new things. It’s the act of coming up with a novel idea and innovating is the act of applying ideas to develop and offer new or improved products and services, making things better, more reliable, and cheap enough so that the mass market has access to it. He states that it is here that we truly and tragically fail in each and every facet of innovation from research and development, where Canada lags terribly, becoming the only OECD economy in which its business sector investment in research and development declined annually from 2001 until 2019. Canada is now standing at the level of developing countries at just above one percent of GDP. Other world leaders are at 5.3%. The OECD average is 1.99%. No wonder we are lagging.
My main point in mentioning this at all, is that the marine industry seems to be catering to the wealthy with ever-larger boats with more power, more sophisticated electronics, and of course, rapidly escalating prices that put boat ownership further and further out of reach for Canada‘s middle class.
What does the future of our industry look like given that information?
Another key question is to ask, why is our business sector investment in research and development at such a low level? Are our taxes and government incentives so out of step with what those investments could earn in other countries that the investment money is leaving Canada?
In the near-future, Canada will have a Federal election and I’d like to hear what our politicians have to say about boosting Canadian R&D and getting our overall economy up to International levels. Canadians deserve that.
Andy Adams – Editor
