Hot! Toronto’s hourglass economy needs a makeover

TheStar.com – Opinion/EditorialOpinion
Published On Fri Nov 26 2010.    By Carol Goar Editorial Board

In economics, a bulging middle is a good thing.

Toronto used to have a healthy oval-shaped economy that produced full-time jobs, prosperity and a good standard of living.

But over the last 20 years, it has assumed an hourglass shape, top heavy with highly paid knowledge workers and bottom heavy with minimum wage service workers. The jobs in the middle, which once provided a decent living and a chance to get ahead, have melted away.

“We call it an economy out of shape,” said Karen Lior, executive director of the Toronto Workforce Innovation Group (formerly known as the Toronto Training Board.)

The symptoms are manifold: employers who can’t find the skills they need, immigrants who can’t get an economic foothold, young Canadians who can’t build a career and a widening gap between rich and poor.

Lior and her colleagues organized a 2 1/2 hour round table this week to tackle the mismatch between the city’s diverse, well educated labour force and its inhospitable job market.

It opened with a panel discussion. Three Torontonians who have thought hard about this issue — David Wolfe, a professor at the University of Toronto who specializes in the economics of city-regions; Catherine Chandler-Crichlow, who heads the centre of excellence in education of the Toronto Financial Services Alliance; and John Tory, chair of the Toronto City Summit Alliance — pinpointed the blockages and proposed solutions.

Their diagnoses differed but their prescriptions were remarkably similar.

Wolfe said Toronto has all the makings of a dynamic urban economy but it isn’t putting them together. Employers don’t recognize community colleges as a valuable source of technical expertise. Universities — with the notable exception of Ryerson — don’t invest in co-op programs, which Wolfe describes as “the glue that binds a university to businesses in the region.” Workers think of innovation as something that occurs in a lab, not something everyone does to improve a product or offer customers better service. And governments take a “peanut butter” approach, spreading around economic development funds to ensure no one is left out.

Chandler-Crichlow said there is a misalignment between the priorities of Toronto’s business leaders and the talents of the city’s diverse, well-educated labour force. Employers are sending the wrong message: “It shouldn’t be we need more skills, it should be we need these skills.” Job applicants don’t make enough of an effort to figure out what businesses do and explain what they bring to the table.

Tory said Toronto has an attitude problem. “We’ve become fat and sassy.” Rather than figuring out why companies like Wal-Mart are so successful, Torontonians turn up their noses at them. Rather than checking out the talent in Toronto’s community colleges and ethnic communities, corporate executives sit in their glass towers. Rather than looking for answers to the city’s economic woes, Torontonians look for someone to blame.

What made the panel unusual was that its participants got down to specifics. They challenged each other. They ruffled feathers.

But they ended up in roughly the same place.

Toronto has to make better use of the assets at its disposal: a rich, complex market and an educated labour force with connections to every part of the world. Business leaders have to get out into the city and see the possibilities they’re missing. Politicians have to look beyond the next poll, the next budget, the next election. Citizens have to shed their smugness.

In an hour, the panel tossed out enough ideas to fuel an animated round table.

The 70 participants didn’t come up with a plan to create a well-rounded economy for the post-manufacturing era. But they moved the debate beyond platitudes and hand-wringing, where it has been stalled for too long.

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