Time to dig deeper into issues within local economy

By Robert Washburn

The revitalization studies examining the downtown business in Port Hope and Cobourg may end up revealing more about what is wrong with the local economy than just the struggles of the retail and services in the core.
As residents watch with interest as the studies begin to release more data and reports, a picture is emerging that should inspire a series of deeper questions about the economic health of West Northumberland. At its heart is the question of whether or not West Northumberland has the regional economic draw is once enjoyed.
It will be critical to the future of the two towns to hold politicians and bureaucrats accountable. Far too often they are more worried about creating a positive spin rather than facing fact and bringing about necessary change.
And, the timing could not be better since a municipal election is on the horizon for 2014.
Take Cobourg’s downtown study as an example.
While there is plenty of data from both customers and business owners in the draft business owners survey about what needs fixing and what people like, the hard facts around the viability of these businesses is a stark.
In examining the business climate, it showed one-third saw an increase in annual sales over the past two years, meaning a vast majority did not. The businesses that are growing are in the service sector, not retail.
What is more revealing is the general sense of negativity within Cobourg’s downtown businesses. While 30 per cent of owners felt more positive about doing business over the last two years, nearly half (43 per cent) of retailers feel it has become more negative over the same period of time.
As for the future, Cobourg downtown business owners are generally split with nearly half saying they are optimistic about future increases in business, while the other half say it will be the same or lower or not sure.
But, the most frightening aspect is the number of businesses without a business plan. One-third do not have an operating plan. Another third do not have a marketing plan. When asked, most say they will stay the same size, while others are looking to relocate, close or downsize. Less, than five per cent expect to expand.
With a struggling manufacturing sector, the heart of the local economy is weak. More and more, West Northumberland relies on its retail and service sector to provide jobs (mostly part-time without benefits).
Certainly, there are the stalwarts, like Sommervilles and Watson’s Pharmacy, who are the bedrock. And, the economic development offices and services provide some support. But the development officers, business support organizations and politicians need to be held accountable when it comes to the effectiveness of these programs. The evidence in the Cobourg study should draw them into question.
A downtown study is only a first step. A full retail study is necessary for both towns to identify the current inventory, but also examine what is needed. These should be combined to provide a larger picture for the region.
A development freeze on all retail space should be put in place, except in cases where existing retail space is present. In Cobourg alone, proposals are already in the pipeline or on the drawing board for New Amherst, along with Second and Albert Streets, while downtown storefront remain empty. One only needs to look at the recent tenants coming in to the new building next to Winners to get a sense of what kinds of businesses are locating here.
The closure of Zellers and the Bargain Shop deserve close public scrutiny. Even the loss of the Swiss Chalet restaurant in Port Hope is an indicator of deeper trends. These need to be explained by experts in an open discussion so a clearer picture emerges.
We need to know if this area is still a regional economic centre or not. Just because new housing is being constructed does not mean the local economy will necessarily grow, if people shop online or go outside the region to shop.
Finally, we need look at the kind of entrepreneurs the region is attracting. The qualities of these kinds of business people is unique, not something everyone is able to do. Yes, a system of supports is necessary. But, maybe it is time to raise the bar on people wanting to start up. Marketing studies, business plans and other hurdles might weed out the weak, leaving storefront open longer, but more viable businesses in the future.
Those are tough measures and might upset the pure capitalists. Yet, the market in West Northumberland it not a hotbed of competition, as the crisis in the downtown demonstrates.
Tough questions need to be asked. An open, transparent public debate must be undertaken because without a healthy local economy, there is nothing else, period.

One thought on “Time to dig deeper into issues within local economy

  1. It seems to me the seeds of the current downtown malaise were sown many years ago, first by the development of the Mall and then by the decision to allow Walmart to come to town. Naysayers then said these changes would kill the downtown, especially Walmart, and we were right. Small comfort though as our main street withers and dies and workers of the closed stores are left with no jobs and nowhere else to replace those paycheques.

    It’s not just small mindedness and lack of planning of the downtown store owners at fault, they are subject to the same large economic forces that buffet all of us. As wages shrink and times get harder, people go to Walmart because those savings matter to their pocketbooks. Dollarama thrives while small businesses suffer. There are no easy answers and more rough times ahead.

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