Where The Jobs Are

CHAIRMAN FRANK

NEW BRUNSWICK IS RUN LIKE A BUSINESS

JOHN DeMONT March 15 1993
Where The Jobs Are

CHAIRMAN FRANK

NEW BRUNSWICK IS RUN LIKE A BUSINESS

JOHN DeMONT March 15 1993

CHAIRMAN FRANK

NEW BRUNSWICK IS RUN LIKE A BUSINESS

Recess was still a few minutes away as the 13 students sat poring over their work at wooden tables in the Fredericton classroom. At a glance, the scene could have been from almost any Canadian school— except for the fact that most of the students were in their 30s and 40s. “I was nervous at first,” declared Kim Young, 35, a single mother of two, who had left school after Grade 9. Like the others in the room, she had been collecting welfare before she learned about New Brunswick Works, an ambitious $ 177-million program which Premier Frank McKenna’s Liberal government began implementing in May. Instead of sitting at home and collecting social assistance, Young spends her days studying English, mathematics and science and learning the skills to help her find a well-paying job. “It is like getting a second chance with your life,” added Raymond Holt,

42, a woodcutter who entered the program last spring. In that, the classroom mirrors a revolution taking place throughout New Brunswick—one which McKenna and his ministers say that they hope will finally change the tiny, impoverished province’s economic destiny.

It is a revolution on the march. McKenna’s businesslike, fiscally conservative agenda has won him praise in the business community and from all stripes of politicians—as well as frequent comparisons to President Bill Clinton, who turned around the fortunes of his small, destitute state when he was governor of Arkansas.

When McKenna became premier more than five years ago, he inherited an unsophisticated economy with an uneducated, untrained workforce. He plans to improve that situation by diversifying the economy and by instituting sweeping education and welfare reforms. Declared Donald Savoie, professor of public administration at the University of Moncton, “What McKenna is doing shows that it is possible for a premier to reshape a province from the bottom up.”

McKenna, in many respects, is a new type of provincial leader. Well-versed in the theories of Massachusetts Institute of Technology economist Lester Thurow, and Harvard University business guru Michael Porter, he describes

himself as “the chief executive officer of New Brunswick.” And his carefully focused, strategically determined approach to governing reflects the latest business management techniques. “The first imperative is to recognize that the world has changed and the old ways of doing business no longer work,” the vigorous, 45-year-old premier told Maclean ’s recently. Indeed, he insists that with budget dollars scarce, New Brunswick was forced to make radical decisions if it hoped to position itself to compete in the evolving global economy and to ultimately become self-sufficient. Added Mc-

Kenna: “To make a dramatic improvement in the quality of life in our province, we really had no other choice.”

Transformation: The transformation has certainly not been immediate. New Brunswick’s unemployment rate stood at 12.1 per cent in January compared with a national unemployment rate of 11 per cent. Last week, the Conference Board of Canada predicted that the economy of New Brunswick, and other Atlantic provinces, would grow by 2.6 per cent in 1993, lagging behind the national average of 3.5 per cent.

All the same, there are signs that McKenna’s approach is paying off. Last year alone, 3,000 new jobs were created in New Brunswick—the second-highest rate of employment growth in the country. And even bigger changes, which lie below the surface, reflect McKenna’s thrust. As jobs disappear in traditional industries, including forestry, mining and fishing, New Brunswick is broadening its economic base by attracting new types of businesses, which will be able to compete in the

technology-oriented, so-called New Economy. Since September, 1991, 50 new companies have moved to New Brunswick and created, in the process, 3,121 jobs.

The newcomers include a swath of hightechnology knowledge-based firms including computer company Unisys Canada Inc., which moved both its Atlantic headquarters and national support centre to Fredericton, and COMDEV Ltd., a Cambridge, Ont.-based manufacturer of satellite subsystems, which set up a facility in Moncton. Just last month, Unitel Communications Ltd., jointly owned by Rogers Communications and Canadian Pacific Ltd., announced that it was building a new long-

distance telephone centre in Edmundston, N.B., creating 400 jobs.

New Brunswick’s bilingual workforce and lower property costs are prime attractions for newcomers, especially those who are concerned about the diminishing quality of life in larger Canadian cities. Another advantage the province has is its recently modernized telecommunications infrastructure, which gives New Brunswick companies some of the lowest long-distance telephone costs on the North American continent and which has helped make the province a burgeoning telemarketing centre.

Clearly, however, much of the attraction is the provincial government of New Brunswick itself. The fiscally conservative manner in which it runs the province’s finances—a manageable $200-million operating deficit in 1992—and McKenna’s own aggressive, no-nonsense approach to doing business have both won vocal admirers in the business sector. “We were impressed that they were running New Brunswick like a business,” declared Ronald Holdway, a spokesman for COMDEV, which decided to put its first Canadian branch plant in Moncton after scouting for locations in several other provinces.

Effective: An even bigger factor, perhaps, has been the persistent sales efforts made by the province’s economic development team—and by McKenna himself. “If you are going to sell your product,” he said, “the chief executive officer has to sell it along with the rest of the team.” McKenna has proven himself to be his province’s most effective pitchman. His picture regularly appears in newspaper advertisements personally inviting businesses to explore opportunities in New Brunswick by telephoning him directly. In fact, the premier, who is known for his tireless work, says that each day he talks by telephone with a number of chief executives of companies that could be interested in exploring potential opportunities in New Brunswick. His salesmanship is clearly paying off. “Honestly, it was his attitude,” said David Wagner, Unisys Canada’s vice-president of Atlantic Canada. “The premier got personally involved. He was quite aggressive, and I think that impressed our management.”

Still, McKenna wants to be sure that he is selling steak with all the sizzle. And that means ensuring that any new companies setting up shop in New Brunswick have access to an educated, well-trained workforce that is able to participate in growing, technology-intensive industries. In fact, his belief in the value of education and training underpins his entire jobcreation strategy. “It is our belief that the new world economy is going to be divided between

the ‘knows’ and the ‘know-nots,’ ” he said. “In that new world order, success will be determined by the human capital.”

On that front, he has reason to be concerned: the province is tackling a provincial illiteracy rate that, defined by the number of adults with less than a Grade 9 education, is 23.9 per cent compared with a national rate of 17.3 per cent. Noted Lino Celeste, president of New Brunswick Telephone Co.: “These days, whether you are a typist or you operate a backhoe, you need a certain amount of education.” The province is acting aggressively to change the situation. New Brunswick schools have started placing more emphasis on such academic fundamentals as reading, writing, arithmetic and science. Meanwhile, the province’s initiatives, including media programs aimed at keeping students in school, have made New Brunswick’s 14.4-per-cent dropout rate the lowest in the country.

McKenna says that he wants to do more— particularly for New Brunswickers who have already left the classroom. The government’s commitment on that front is underscored by New Brunswick Works, the program designed to break the seemingly endless cycle of welfare in the province. The program, which is funded by money that has been redirected from welfare, unemployment insurance and other sources, offers longtime welfare recipients the chance to get back to work under a three-year program of paid work, education and training in specially set-up schools. “For most of us,” said Scott Holmes, 36, a former woodcutter who had been making $760 a month on welfare when he entered the program, “this is a last shot at improving our lives.” When his retraining is completed, Holmes says that he hopes to be a youth worker.

For others, the government programs offer a path to a new sense of self-worth. Ruth Peterson, 39, is a single parent who lives in Fredericton with her two children. Growing up in a family of 18, she had to leave school in Grade 7 to help out at home after her father died. Now, Peterson spends each weekday upgrading her reading skills at one of the 100 Community Academic Services Program literacy centres in the province, as part of a $1.7-million campaign to upgrade adult literacy. “I always felt that I was stupid,” she said. “This has made me a different person and given me a sense that I am getting somewhere in life.” For McKenna, who has similar goals for the whole province, those are welcome words indeed.

‘I was nervous at first,' about returning to school to learn English, math and job skills

JOHN DeMONT

STEVE LLEWELLYN