Calgary: A Diversifying Economy
- Significant foreign investments in agriculture have contributed to the formation of agri-business cluster in Calgary.
- The low cost of living, low taxes, and low property prices position Calgary as one of the best places to work, live, and invest.
- Transitioning to a more digital economy will be the key to Calgary’s post-COVID recovery and the city is working with the federal government to retrain its workforce with digital skills.
Calgary needs to be further promoted as a premier destination for foreign direct investment in diverse sectors, as there are still misconceptions about Calgary as solely an oil and gas town. With a booming tech sector and plans to transition the educated populace towards more specialties in the realm of software programming, Calgary is set to become a tech hub with plenty of opportunities for investment and job creation.
What do you identify as Calgary’s main competitive advantages when it comes to attracting foreign direct investment?
Calgary has many competitive advantages. First and foremost, it is the most liveable city in the western hemisphere according to The Economist Intelligence Unit and the fifth most liveable city in the world, but I do not think people think about Calgary that way. Obviously, we are a big-small city, and we have approximately 1.4 million people. Our population is one of the highest educated and youngest in the country, so productivity even in these tough times is higher than any other city in Canada.
In addition to that, we have a high quality of life, a talent pool which is very science-based, the highest concentration of engineers, affordable space, a low corporate tax environment here, and this is a city of problem solvers. We have been solving problems for the world for generations. We continue to do that and really see advanced technologies starting to play a role in helping us solve those problems for the world.
“Our population is one of the highest educated and youngest in the country, so productivity even in these tough times is higher than any other city in Canada.”
From an architectural perspective, community perspective, and safety perspective, there is not a better place to live. It has a low cost of living—you can buy four houses in Calgary for what you would pay in Vancouver or even potentially Toronto. From a talent retention perspective, it is a city where people tend to stay. Even through the last six tough years we have had, we have had very few people exit this community and part of that is because they have such strong attachments to it. Our quality of life is second to none, with the Rocky Mountain playground just an hour away. It is an easy city to get around and a safe city to get around.
The price of office space must be very important when you are trying to attract headquarters.
One hundred percent. What people do not know is we have built an office space infrastructure which was built on a forecast or a strategy of $100 per barrel of oil. We know that that is not the reality anymore and we have more office space on a per capita basis than any other city in North America. In fact, we have double Toronto, we have triple that of cities like Pittsburgh and Denver and we have four times as much as cities like Detroit and Houston. When you think about that, you realize there is an abundance of very economical office space that should be a big attracter. That combined with a low corporate tax environment—the lowest in the country—makes us primed for the picking right now and certainly, there is lots of interest picking up.
What are some of the up and coming or most promising industries that will help Calgary and Alberta diversify its economy?
Calgary will always be a global energy centre because we are blessed with an abundance of natural resources in this province. We do not necessarily have oil underfoot in Calgary, but throughout the province, we definitely do. We are also blessed with wind and solar—we have some of the highest production in the big wind and solar farms in the country, and we are also pursuing new opportunities in geothermal and in hydrogen. We are determined to bring cleaner energy to the world, and we are going through a transition in the energy industry. Calgary will remain a global energy centre and deliver more clean energy. If you look at cleantech in particular, the cleantech investment coming into our market versus the rest of the country is much more significant than it is anywhere else. Part of that is that many of the traditional oil and gas companies are actually making those investments. Even the energy industry is changing and diversifying within and that is good news not just for Calgary and the country but for the world.
“Calgary will always be a global energy centre because we are blessed with an abundance of natural resources in this province.”
We also have seen great growth in agriculture. We have had many multinational companies either consolidate and/or set up here, which speaks to how prior to the oil and gas industry, we were an agriculture economy. We are really focused on agri-business value addition and agtech and have been making great advancements in that. We are a transportation, logistics, and aerospace hub, and increasingly so with great, world-class research being done out of the universities, we are becoming a centre for life science and health.
Calgary is the perfect city to embrace advanced technologies, which are coming towards us in industries we excel at like a tsunami, to try and solve problems for the world—whether that be cleaner energy, safer and secure food, the efficient movement of goods and people, and better health solutions. All of that was tested during COVID-19 and so we are seeing rapid growth in tech jobs in our community and we are seeing tech companies emerge.
“Calgary is the perfect city to embrace advanced technologies.”
Calgary has seen the number of tech companies double and we expect that to double again in the next 10 years. This is a tech ecosystem because tech is not a sector anymore, it is a way of doing business across the board, and the impact on our industrial sector is absolutely profound.
Which areas of Calgary have been attracting foreign investment and which areas do you see attracting the most investment in the coming years?
We have definitely seen in the recent years, following a significant amount of foreign direct investment coming in the energy sector and in all kinds of subsectors of the energy industry, a lot of investment particularly in agriculture. Many multinationals are either consolidating here or setting up here, which has really created a strong cluster here. Also, in logistics as well as aerospace, we have seen significant influx of companies coming into Calgary.
“Prior to COVID-19, we saw 27% growth in tech jobs in Calgary.”
What the future looks like is that we are going to see a dramatic increase in technology companies whether they be multinational technology companies that are servicing major corporations or if they are actually producing either goods or services through technology. Prior to COVID-19, we saw 27% growth in tech jobs in Calgary. For the first time, we are seeing bigger influxes of venture capital, which are helping smaller companies grow here and those are the companies that will be the job creators of the future. Combined with large multinational tech companies coming in here as well as the homegrown tech companies, I believe that they are going to be the job creators of the future.
How would you qualify the city’s innovation ecosystem and the availability of talent?
Calgary has the highest concentration of engineers in the country and most of them have been focused on the energy industry, and so that is good news. The bad news is we have a disproportionately low percentage of software engineers, data scientists, coders, and programmers.
We have been on a journey the last few years to increase or widen the pipeline coming out of the post-secondaries, trying to transition some of those people that were displaced out of the energy industry into more advanced technologies or the digital economy. It does not matter what industry you are in—everybody’s recovery from COVID-19 is going to be a digital recovery. It is no different in our industrial, energy, agriculture, transportation, logistics, and health sectors. We have been madly trying to increase seats. We have almost doubled the number of seats in the post-secondaries and we have just made an announcement recently that there is going to be a downtown digital tech hub that is going to be run by the Southern Alberta Institute of Technology right in Downtown Calgary to help some of the companies and people transition.
“It does not matter what industry you are in—everybody’s recovery from COVID-19 is going to be a digital recovery.”
Those are all good news stories because it is not a quantum leap for a reservoir engineer to become a data scientist or for an electrical engineer to become a software engineer. We have such a math and science-based population that it is low-hanging fruit for us to try to help transition those people and also, retain them here. It is not just a shame for our city—it is a shame for our province and our country that those people have been sitting idle for so long. From a talent perspective, Calgary is in a better position than a lot of other jurisdictions in the sense that our talent is very retrainable. We are also in a better position in that we are widening our pipeline, but we also have to attract talent, and that is probably the biggest hurdle.
The problem is the perception that Calgary is only an oil and gas town and from what we know about tech workers, they do not want to know where their first job is, they want to know where their second, third, and fourth job is. Awareness is needed that Calgary has pure high-tech companies and fintech companies batting way above their weight and technology applications across all our industrial sectors. You could work in a number of companies with these advanced technologies. In this province, we have a real strength in artificial intelligence (AI) and machine learning. We are the third in the world in researching AI and machine learning at the University of Alberta, and so talent is coming out of that at a rapid rate and we are trying to retain as many of those people as possible.
“Calgary has pure high-tech companies and fintech companies batting way above their weight.”
The talent pool is in a transition, but it is probably an easier transition for our city than it is for a lot of other cities. We had the federal government invest in a program called EDGE UP, which is an acronym for Energy to Digital Growth Education and Upskilling Project. We ran it as a pilot, and we put 100 people through that program. We had 1,300 applicants, which just speaks to the demand and how people are wanting to change.
What kind of supports do the Calgary Economic Development, municipal, and Alberta government offer foreign companies looking to invest in Calgary?
Let me start with the provincial government who just set up a Crown corporation called Invest Alberta. The good news for us is that they co-located in our office, so it gives us an opportunity to go hunt in a pack. We are going to work closely together. We know that companies and people move to cities, so it is really important for us to be integrated and present a united front. It makes it easier for the companies and the clients that we are pursuing.
“We know that companies and people move to cities, so it is really important for us to be integrated and present a united front.”
From a municipal perspective, our City Council took a very bold move a couple of years ago. It created a fund called the Opportunity Calgary Investment Fund and we have a $100 million fund where we have designated or earmarked $40 million for other projects. It is a milestone-based grant program, and we are looking for companies that are prepared to move 500-plus jobs here. That is a program that they can go through and see if they can secure additional funding for relocating here.