Canadians will find out next month whether the federal government is paying attention to the growing calls from business to improve our country's productivity, competitiveness and standard of living.
Federal Finance Minister and Deputy Prime Minister Chrystia Freeland announced today that Budget 2024 will be presented in the House of Commons on April 16. The Canadian Chamber submitted a list of recommendations during budget deliberations that came from business leaders across the country. Many of these are echoed by members of the Greater Victoria Chamber of Commerce. "We need economic growth to be driven by the private sector, and some of the changes that can be done on a federal level are simple — and cost effective — changes to red tape," Chamber CEO Bruce Williams said. "We know innovation is driven by business and it's time for government to focus on policies that encourage investment in the infrastructure needed to build a sustainable and resilient economy." Among the recommendations are to:
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The provincial government is raising the minimum wage by 65 cents, effective June 1.
The increase means the lowest an employee can be paid is $17.40 per hour, up from $16.75. The rate reflects annual inflation in the province. "We know many Chamber members already pay more than the minimum, but inflating the base rate inevitably increases the wages of other employees, which adds further costs during a time of economic uncertainty," Chamber CEO Bruce Williams said. "Businesses are already working hard to find and keep good workers, and we understand that increasing wages is part of that. And while we appreciate that the government is giving businesses time to adjust and offering future certainty by tying the increase to inflation, we think there are better ways government can lower the cost of living to make our province more affordable." The shift to working from home that was sparked by pandemic restrictions is continuing to impact the commercial real estate sector.
CBRE's Canada Real Estate Market Outlook 2024 reports that office vacancy, at 8.7%, remains elevated in Greater Victoria due to turbulent conditions. In an interview with the Times Colonist, CBRE Ltd. Victoria Vice-President Ross Marshall said landlords are trying to be as accommodating and innovative as possible to keep clients and find new ones. Downtown spaces also face challenges from perceptions about parking and social distress in some areas, Marshall said. Greater Victoria has 9.37 million square feet of offices, with rent for Class A spaces going for $27.25 per square foot. "The completion of strata developments in the Westshore will relieve some of the industrial shortage in Greater Victoria and is currently just over 65% pre-sold," the report states. "Inventory levels still remain heavily undersupplied outside the Westshore. Asking rates are projected to stabilize around mid-2024 after tenants fully occupy investor-purchased strata units and the availability rate normalizes." Housing supply is a keystone issue. It affects almost all other Chamber advocacy priorities, so we're pleased with yesterday's announcement of the BC Builds program. The goal of speeding up construction of more homes for middle-income earners is vital for ensuring we have the skilled workforce needed by employers.
It's too soon to know all the details of BC Builds, which the province says will leverage land owned by government, municipalities or non-profits along with $2 billion in low-cost financing and a commitment of $950 million for the overall program. The Chamber has called on all levels of government to look at solutions used in other jurisdictions around the world, including Vienna, Austria. BC Builds appears to do just that — though some municipal leaders are already pointing out gaps in infrastructure that need to be addressed. The executive lead for BC Builds, former Victoria mayor Lisa Helps, told Business in Vancouver the program will allow construction to continue on rental homes at a time it is being slowed by other forces. “BC Builds is not an affordable housing program, it's not supportive housing, it's not subsidized housing. It's really meant to close the gap above where BC Housing programs end and where we … start to really see a slowdown in rental development if there isn't an intervention,” Helps said. BC Builds at a glance: > At least 20% of all BC Builds homes will have rents at least 20% below market rate for projects in partnership with non-profits and First Nations. > All BC Builds units have a target of middle-income households spending no more than approximately 30% of their income on rent. > The rents for BC Builds will not exceed market rent for that community, and will in many cases be below. > All households living in BC Builds homes are income tested at move-in. > The income levels vary by community, so homes are within reach for that community’s middle-income households. > BC Builds projects aim to deliver more two-, three- and four-bedroom homes, as many as possible with below-market rents. > Projects owned and operated by non-profit providers mean rents will remain low over time, creating more affordability. There's reason for optimism in Greater Victoria's real estate sector, as a sense of stability is returning after what felt like truly turbulent times.
"Mortgage rates have levelled out, inventory is slowly creeping back up, and we are no longer in that highly pressurized market of recent years which created complicated and sometimes stressful conditions for buyers and sellers," Victoria Real Estate Board Chair Laurie Lidstone said in the organization's latest news release. "If balanced conditions continue, buyers and sellers will have more time to make decisions and there will be less pressure on pricing. Of course, there are many factors that impact the market here in Victoria, and, as we've seen in the past, things can change very rapidly." The real estate board had 2,140 active listings for sale at the end of January, a 23.1% increase from 12 months ago. The benchmark value for a single family home in January was about $1.24 million, down from December's value of $1.27 million. The benchmark value for a condominium in the Victoria Core in January was $559,000, down from the December value of $562,000. Canada is a trading nation, and many businesses in Greater Victoria provide goods and services to an international customer base. Building connections across borders is vital to helping business operate as smoothly as possible.
On Monday, the Chamber welcomed Vancouver-based US Consulate General Jim DeHart to Victoria. "I've spoken with Mr. DeHart during trade missions in the past and he's always expressed an interest in learning more about Greater Victoria and Vancouver Island," Chamber CEO Bruce WIlliams said. "I'm glad we were able to host him for a roundtable with some of our region's business leaders for a discussion on trade and cross-border relations." Topics covered an array of interests, including labour force mobility, credential recognition and ongoing efforts to streamline regulations. The Chamber is following up on concerns expressed by local post-secondaries facing a serious and unanticipated financial burden from the surprise federal announcement to cap the international student program.
Yesterday, the organization representing Canadian schools sent a joint letter to federal Immigration Minister Marc Miller. "We urge your department not to impose the letter of attestation requirement for college and undergraduate study permit applications until at least March 31 or until the provinces establish an effective process," the letter from Universities Canada and Colleges and Institutes Canada stated. "Additionally, we request urgent consultations with the sector to modify the cap policy, clarify the many outstanding questions and mitigate the negative impacts." On Monday, BC announced new regulations that will constrict the number of international students in the province. Of BC's 545,000 post-secondary students, 175,000 are from 150 countries other than Canada. "After speaking with our members impacted by these changes, The Chamber is concerned that this policy is being presented as a solution to the housing crisis when it will significantly reduce revenue needed by schools," Chamber CEO Bruce Williams said. "A better solution is to invest in more on-campus housing so that schools continue to provide the workforce our economy needs, while creating a pathway for foreign students to become taxpaying new Canadians." A new report offers insight into how shifting consumer behaviours are changing the way small businesses operate post pandemic.
On Monday, the Canadian Chamber of Commerce’s Business Data Lab released A Portrait of Small Business in Canada: Adaption, Agility, All At Once. The findings shed light on how businesses can thrive despite the rising cost of doing business, the highest borrowing costs in over two decades and the increased pandemic debt loads. Examples for businesses include investing in technology, staying agile to embrace shifting trends and working with their chamber to call for less red tape from government. The report also explores the unique realities, challenges and opportunities for small businesses owned by women, persons with disabilities, members of the LGBTQ2s+ community, immigrants to Canada, Indigenous peoples and visible minorities. The federal government announced this week that it was putting a cap on the number of international students permitted in Canada each year. The measure is an attempt to ease the demand for housing, which is in short supply across the country.
However, the one-size-fits-all approach will hurt efforts to train international students needed to fill vacancies in industries facing a severe labour crunch. Child care and health care are two examples that depend on foreign workers to help meet the need. There are also concerns about the cap giving Canada a black eye with overseas students who will look to study in more welcoming countries. “The message has to be external, that Canada is open for business for international students. That’s hugely important,” Royal Roads University president Phillip Steenkamp told CHEK News. “There is still a commitment to bring a significant amount of international students. They make an enormous contribution to our economy and society, and we’ll continue to welcome them here.” The Times Colonist reports that Camosun College and the University of Victoria have experienced fluctuations in the number of international students from before the pandemic to now. Camosun had 2,094 international students enrolled in fall 2023, compared to 1,674 in 2019. UVic has roughly 1,600 international students in the current school year, and had more than 2,500 in 2019. Greater Victoria's unemployment rate of 4.1% in December was unchanged from November 2023. According to Statistics Canada, the region's population increased to 367,400 from 366,700 over the month.
Our local labour force was also up with 244,700 people in December compared to 242,900 in November. The stats reflect the national trend as employment growth slowed in the second half of 2023 with population growth outpacing the number of new jobs added to the economy. "The momentum in the labour market is weakening alongside the fastest population growth in more than 50 years," Canadian Chamber Senior Economist Andrew DiCapua stated in a news release. "With essentially flat job growth in December, the Canadian labour market ends 2023 with over 5% wage growth and an unemployment rate steady at 5.8%. Although hours worked rose for the month, this will be a drag on fourth quarter GDP as we round out the year. This signals to the Bank of Canada that the guise of a strong labour market is cracking amid strong labour force gains. With wages accelerating, the Bank was wise to not celebrate at their last meeting, possibly delaying their intentions to begin rate cuts." More than 550 rental homes that meet affordability guidelines were added to Greater Victoria's housing supply, according to a website that reports on the region's real estate and development sector.
Citified.ca states that 342 of the homes were below-market rentals, including 130 suites in The Dalmatian — a project by Jawl Residental Ltd. that is owned and operated by Pacifica Housing Ltd. About $19 million of construction costs was covered by BC Housing, which will also provide annual operating funding of $1.6 million. The Dalmatian is a great example of innovation led by business with collaboration from the public and non-profit sectors. Citified.ca forecasts 2024 will see record levels of public-sector supported rental units come online. Greater Victoria needs more homes, especially units affordable to the workforce needed by our region's employers. Property owners, check your mail. You can expect to receive your 2024 assessment notice any day now. The assessments reflect market value as of July 1, 2023, and can also be viewed at bcassessment.ca.
“For 2024, most homeowners can expect generally flat values including a mix of small decreases or only modest increases, reflecting the softening real estate market," Vancouver Island Deputy Assessor Matthew Butterfield stated in a news release. "Homeowners throughout Vancouver Island will generally see somewhere in the range of -5% to +5% change in assessment values." Total assessments for Vancouver Island properties were more than $386 billion this year, up about $1 billion from 2023. Assessments are not directly connected to any change in your property taxes, as those are set according to the needs of the municipality your property is in. However, if your property's value changed relative to other properties, you might see a change in your tax bill. In Greater Victoria, every municipality experienced a drop in the assessed value of a "typical home," including the examples below: In 2023, generative artificial intelligence was suddenly everywhere. It's showing up in business software applications, Internet search functions and standalone apps that enable even non-technical users to overcome writing, coding and design challenges.
To help businesses benefit by adopting AI responsibly, the Canadian Chamber of Commerce held an AI Executive Summit on Nov. 22. Among the key themes that emerged were:
The themes will guide the work of the recently formed Future of AI Council, a 30-member forum representing a cross-section of organizations. The council "will play a leading role in advocating for government policies that establish AI as a positive economic force through the responsible development, deployment and ethical use of AI in business." A slow economy could help Greater Victoria residents finally make the move to a new home within the region. Having that mobility is one of the keys to improving the supply of housing affordable to people at various stages of their careers.
"Local people who planned to sell and move within Greater Victoria may have hesitated to list their homes back when record low inventory meant less choice when they became buyers," Victoria Real Estate Board Chair Graden Sol said in a media release. "Now that we see some balance in the market, these people have more inventory to pick from and may feel more confident listing their existing home. And of course, all buyers are having better experiences with more time and more choice." There were 2,644 active listings for sale at the end of November 2023, a 25.2% increase from November 2022. The benchmark value for a single-family home in the Victoria Core in November 2023 was $1,286,400, down from October's value of $1,305,900. The benchmark value for a condominium in the Victoria Core area in November 2023 was $577,400, down from the October value of $585,600. New housing on campus at the University of Victoria is helping ease pressure on the region's rental market.
A residence opened in September, providing 385 single rooms for first-year students. UVic guarantees on-campus housing to help new students acclimate to university life. A lounge for Indigenous students also opened as part of the multi-stage project, which will add 621 new beds and 162 replacement beds, increasing on-campus housing by 25%. The Songhees Nation gave UVic permission to use lək̓ʷəŋən names for the new buildings to honour the territory on which the buildings stand. The first residence, Čeqʷəŋín ʔéʔləŋ (Cheko'nien House), is named after what is now known as Oak Bay, while Sŋéqə ʔéʔləŋ (Sngequ House) is named after a village located in what is now known as Cadboro Bay. The Chamber has been a vocal advocate for the on-campus housing to help free up rental units for our regional workforce. Greater Victoria saw a jump in the value of residential permits in September compared to the same month last year.
The total value of residential permits in September was $203.8 million, compared to $175.9 million in September 2022. The region also posted a 134% jump from August, which saw $87.1 million worth of residential permits issued. Across Canada, the total monthly value of residential permits increased 4.3% to $7.2 billion in September, led by a 37.2% monthly increase in construction intentions in British Columbia. The new building permits account for 21,700 new dwelling units nationwide, 5.6% more than August 2023 and 2.3% more than September 2022. The findings of a report released today calculating the cost of living in Greater Victoria is not a surprise.
According to the Community Social Planning Council, the 2023 Living Wage for Greater Victoria is $25.40 per hour. That's $1.11 (4.6%) higher than the 2022 rate of $24.29 per hour. "The Chamber continues to work on helping employers find and keep workers, and one of the biggest challenges for organizations is the impact of labour costs on top of all the other input costs that have gone up over the past year," Chamber CEO Bruce Williams said. "Our members are great employers, but it's not easy passing on higher prices to customers. We need all levels of government to address the root of these rising costs." Annual household expenses for a family of four are up $2,393.29 from 2022. The report, released in partnership with United Way Southern Vancouver Island, cites shelter and food costs as well as non-MSP health expenses for the increase. “Given the pressures of housing and inflation, the rise in the Living Wage is alarming but not totally unexpected,” UWSVI Executive Director Erika Stenson said. “It also provides us — whether we are employers, any level of government, business, or labour—with the incentive to convene and discuss realistic, pragmatic ways to help families in Southern Vancouver Island manage the issues around affordability." Chamber members have been calling for a better way to recognize certification gained outside BC. New legislation introduced this week is a step forward, recognizing 29 professions overseen by 18 regulatory authorities.
If the international credentials recognition act passes, the province could have a new superintendent by next summer in charge of fair credential recognition. "We know the stories of highly trained professionals who come to Canada and are only able to find work washing dishes or driving cabs," Chamber CEO Bruce Williams said. "International standards often correspond with provincial standards, so it makes perfect sense to let people who choose to come here continue their careers here. Employers in our region have positions going unfilled and workers are underemployed. Simply put, recognizing international certification will improve this disconnect." The 29 occupations are:
The Chamber has long called for a more sensible approach to recognizing the skills newcomers bring to Canada. We've all heard the stories of trained doctors driving cabs and other professionals who can't work in their chosen field despite high demand for their service.
"That is changing. I'm thrilled to share the news that British Columbia is moving to help regulatory bodies improve the process of credential recognition," Chamber CEO Bruce Williams said. "We hear all the time from employers who are frustrated because they need workers but can't hire qualified newcomers because they were trained out of province." Upcoming legislation will streamline pathways for skilled people with international credentials while maintaining standards and safety. According to the provincial government, 387,000 newcomers are expected to enter the B.C. workforce, filling 38% of job openings over the next 10 years. Chamber advocacy is helping make changes that will increase housing supply. This is critical to a sustainable economy. We need more homes for people of all incomes so our region remains attractive as a place to grow a business, build a career and raise a family.
One of the keys to building more houses is for our construction sector to have enough skilled workers. The industry is expecting more than 72,000 jobs to open up over the next decade. A new fund, announced today, will provide grants of up to $5 million per project. The Workforce Innovation Fund will:
"We continue to work with all levels of government, our partner organizations and our national chamber network to call for investment in the construction industry," Chamber CEO Bruce Williams said. "Builders need to have the people and resources required to improve our critical housing supply." The targets are now official for three Greater Victoria municipalities deemed to be among the top 10 BC communities with the most pressing housing needs.
The Housing Supply Act requires the following number of new homes within five years:
“These targets are a step toward creating more homes to meet the diverse housing needs of Saanich residents,” Saanich Mayor Dean Murdock said in the province's news release. “We are committed to working together with the Province on housing solutions, and welcome their support to help us achieve our goals.” After six months, and every year thereafter, municipalities will be evaluated on their progress. A second cohort of eight to 10 municipalities will be selected by the end of the year. The provincial government has capped the allowable rent increase to 3.5% for 2024.
Landlords who plan to raise rent in 2024 will need to provide tenants with three months notice using the correct form and following specific rules. BC's Minister of Housing, Ravi Kahlon, said costs are increasing for landlords and tenants. The need for affordable housing well documented, but many property owners are facing higher costs for repairs, financing and maintenance. The province claims the 3,5% cap will keep people housed while making sure rental units stay on the market. The rent increase cap does not apply to commercial tenancies, non-profit housing with rent geared to income, co-op housing and some assisted-living facilities. The latest sales figures show a slight increase in the number of homes for sale, though the demand for housing continues to affect the cost of living in our region.
According to the Victoria Real Estate Board, there were 2,490 listings at the end of August. That's up 2.9% from the previous month and higher than the 2,137 homes listed in August 2022. "The focus in our market and by all levels of government needs to be on opening up more supply," VREB chair Graden Sol said in a news release. "Our inventory levels, though up from last year, are still too low to support a well-balanced market. A decade ago, we saw over 5,000 active listings in August." Sol noted that many listings were for single family homes, which are at the top of the residential market. "Missing middle homes, such as townhomes and condos represented only 37.1% of listings for sale," Sol said. "Townhomes, which in my experience are what a lot of families hope to purchase, represented only 9.8% of the residential properties for sale. This imbalance in the mix of housing options means there is the potential for more price pressure on these types of properties because demand is concentrated at more attainable price points." The benchmark value for a single family home in August was $1,323,900. That 's up $5,100 from July but down $3,800 from last summer. A new report by the Conference Board of Canada's Workplace Mental Health Research Centre found that your organization's policies on absenteeism could directly affect the productivity of employees. The study noted that it's difficult to measure presenteeism — workers pushing through their day despite feeling unwell physically or mentally. A lack of awareness and sense of trust between employer and employees was cited as a common reason for not addressing presenteeism.
“Without formal productivity measures, how can you tell that somebody is showing up and not delivering 100%?" the reports quotes one unnamed employer. "I don’t know that you can.” Most of the causes for presenteeism were related to symptoms of illness, stress and and trouble sleeping. Stigma around mental health continues to be a major factor for workers punching the clock when feeling unwell. There remains concerns about how disclosing an illness could impact their standing in the workplace. The report suggests organizations can take active strategies, such as accommodations for caregivers — predominately women — so they can remain on track for career growth and can overcome the many barriers they face. The conference board established the research centre to increase awareness and understanding of workplace mental health through research, analysis and dialogue. High-interest rates and uncertainty over the state of the economy are behind the tourism industry slowing down after its fast recovery from the pandemic. A report by TD titled "A Slow Road to Recovery for Canadian Tourism Spending," states the industry won't fully recover until about 2025.
Current tourism spending is at about 87% of where it was in 2019. "Although more price-conscious tourists could weigh on profit margins in the sector, slower demand growth may allow the industry time to overcome labour shortages," the report states. In BC, tourism employment is the highest its been since 2018 as employers work to overcome challenges finding and keeping staff. Greater Victoria tourism earns environmental rep Back in May, Greater Victoria received some love from a feature in Vogue about how we "became a sustainable travel hotspot." the article identifies a number of Chamber members who have helped make Greater Victoria green, including:
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