By Frank Scarcello
Thunder Bay Ventures, a non-profit community futures development corporation funded by Industry Canada, presented in mid-July the results of the 2002 Thunder Bay business opinion survey indicating both optimism and pessimism in the attitudes and performance of small business in the city.
The fifth annual survey targets small business with less than 20 full-time employees and was conducted in a five-week response period during May and June of this year. The objective of the survey was to gauge the current and future business climate in Thunder Bay.
The response rate for the survey was 14.7 per cent compared to a 20 to 25 per cent rate in previous surveys.
The good news comes in the areas of employment and revenue growth, says Royden Potvin, manager of Thunder Bay Ventures. Ninety-seven per cent of respondents expect to maintain or increase their employment levels over the next 12 months and 61 per cent have had an increase in 2001 revenue. This is an increase in both areas over last year, Potvin says.
However, conflicting with the good news, small-business owners are not optimistic about future economic growth in the city, Potvin says. About 77 per cent of respondents expect zero or negative growth in the local economy over the next 12 months.
According to David Smith, a professor from Lakehead University who developed and conducted the survey, the biggest surprise came in the areas of higher education, tourism/hospitality and retail sectors. Respondents identified, for the fifth year in a row, these areas as having the fastest growth potential in the Thunder Bay economy, Smith points out. With the development of the northern medical school and the advanced technology and communications centre at Lakehead University, respondents appear to be gaining confidence in these areas, he adds.
The most significant finding came in the area of local governance. More than 85 per cent of respondents believe that Thunder Bay city council is not doing a good job representing their small business, and approximately 84 per cent believe that city council does a poor job in examining economic development opportunities in Thunder Bay. This trend is up from 72 per cent last year, Potvin says.
However, “small business is thriving in spite of city governance,” Potvin says. “City governance is irrelevant to small business.”
The survey also indicated that many small businesses are concerned with lending policies of local financial institutions. They feel access to capital has not been a problem up to this point, but are not sure about future access. Potvin, who has a background in banking, stated that this might be due to the decline in value of commercial property in the city.
A survey conducted three years ago indicated healthy optimism regarding the establishment of the Thunder Bay Charity Casino. However, the past two surveys, and this year’s survey, have established a trend that indicates that small businesses have been negatively affected by the casino development. Not surprising, Potvin says, is that the recent closure of Safeway is expected to have a detrimental impact on the Thunder Bay economy.
