The Economic Vitality of Small Cities in Canada: A Case Study of Kamloops and Prince George
Allysha Sorba, Kyle Vike, and Gilles Viaud Ph.D.
Department of Geography
Thompson Rivers University

Introductio
Introduction
In Canada, small cities - defined here as agglomerations with
populations less than 100,000 people, are experiencing different rates of
demographic and economic growth, ranging from rapid to slow growth
and in many cases decline. In a study on the impact of university
campuses as regional economic growth poles, Meyer and Hecht (1996)
use six primary indicators to measure the economic vitality of regions.
The objective of our research is to test Meyer and Hecht's indicators to
uncover if they can provide researchers with a simple method to
empirically and objectively analyze the demographic and economic
vitality of small Canadian cities. If the analysis of the indicators calls
attention to the economic and demographic discrepancies that are
broadly known to exist between our two case study cities of Kamloops
and Prince George, then we could safely propose that these indicators
can be used to obtain a quick and efficient view of the current economic
vitality of small cities in Canada.

Meyer and Hecht’
Hecht’s 1996 Economic Vitality Indicators
1. Median income levels - indicator of overall level of economic well being
2. Employment rates - indicator of overall level of employment
3. Quaternary employment - indicator of high-tech employment intensity
4. Population change - indicator of new business creation
5. Average value of dwelling - indicator of growth and prosperity
6. Manufacturing employment levels - indicator of the intensity of the
traditional industrial economy

Literature Review
Many small cities and regional municipalities have sought to address
demographic stagnation or decline by stimulating economic growth through
a process of transitioning from a primary resource extraction base to an
economy with secondary and quaternary oriented jobs (Nelson, 2005;
Portnov and Wellar, 2004). For a number of small cities, success in
expanding job opportunities came from a higher quality of life, innovations,
and technology which is embedded within services and manufactured
products and therefore, attracts and retains a skilled labour force (Siegle
and Waxman 2001, p.32; Mackinnon and Nelson 2005; Cutler and Davies
2007; Bourne and Simmons 2003). Cities which have not yet transitioned
from the “classic resource town” remain vulnerable to cycles of economic
boom and bust (Nelson 2005, p.99). A host of problems follow a declining
economy based on primary industry such as declining population, a
shrinking tax base and fewer employment opportunities (Bourne and
Simmons 2003; Siegle and Waxman 2001: Hoekstra 2008; Nelson 2005;
Ray 2008).

Kamloops and Prince George as Case Studies
Kamloops and Prince George were chosen as case studies because
they are similar in many respects: they are both small university cities in
British Columbia and have relatively equal population. However, both cities
appear to be on completely different tracks in terms of their economic
growth and population migration trends. For instance Kamloops population
has grown by 5.2% between the 1996 and 2006 census years while Prince
George recorded a -5.6 decline (Table 1).

Traditionally based on forestry, ranching, agriculture, and mining, Kamloops’
economy has successfully transitioned in the last two decades towards one more
based on high – technology, tourism, and manufacturing. This economic transition
has helped Kamloops to attract a diverse array of corporations and businesses to
locate in the city (Venture Kamloops 2006).
Prince George on the other hand has remained a “classic resource town”
(Nelson, 2005. p.99) and is considered to be the service sector hub of Northern
British Columbia, where big box retailers, shopping centers, and service outlets
meet consumer demands and take advantage of people accessing the city via two
major highways from surrounding regions (Mack, 2004). In addition to having a
service based economy, the city relies on forestry and mining in the primary
economic sector, rail and air transportation, and a technology and research based
university to fuel its economy (ibid).
Table 1
Meyer and Hecht' (1996) Economic Vitality Indicators for Kamloops and Prince George, 1996 and 2006
1996
Economic Vitality Indicators

2006

Kamloops

Prince George

Total

Total

Percent

Total Population 76,394

Percent

75,150

Kamloops
Total

Percent

80,376

Prince George
Total

Percent

70,981

% Change 1996‐2006
Kamloops Prince George
5.2

‐5.6

Total Employed, 15 Years and Over 36,830

61.7

37,495

66.1

41,930

63.5

37,755

66.5

13.9

0.7

Manufacturing Employment 1,665

4.5

2,925

7.8

1,460

3.5

2,125

5.6

‐12.3

‐27.4

Quaternary Employment 13,560

32.7

12,600

29.7

17,000

38.1

14,710

36.0

25.4

16.8

Median Income 56,345

60,193

76,518

80,147

35.8

33.2

Average Value of Dwelling 146,494

135,975

257,242

178,738

75.6

31.5

Source: Statistics Canada 1996 and 2006

Methodology
Variables used to reproduce Meyer and Hecht’s primary economic vitality
indicators (Table 1) are taken from the 1996 and 2006 Canadian Census of
Population. Quaternary sector employment includes occupations in management,
professional and secretarial occupations in business and finance, natural applied
sciences and related occupations, health occupations, social science, education,
government services and religion occupations, and arts, culture, recreation and
sports occupations. Variables for both census years were extracted for Kamloops
and Prince George to study the evolution of the trends in the indicators.

Discussion of Results
As noted before on Table 1 , Kamloops has witnessed a 5 percent
population increase between 1996 and 2006whereas Prince George has seen its
population decline by almost 6 percent. Used by Meyer and Hecht as a proxy to
new business creation, this indicator calls attention to the state of economic
difficulty Prince George has experienced over the period under study.
This interpretation is supported by the growth in average value of dwellings
which is an indicator of growth and prosperity in Meyer and Hecht’s model. Dwelling
values have been consistently higher in Kamloops than in Prince George.
Furthermore, the average value of residences has increased by 75.6 percent in
Kamloops and by only 31.5 percent in Prince George during the period under study.
This interpretation is supported by the growth in average value of dwellings
which is an indicator of growth and prosperity in Meyer and Hecht’s model. Dwelling
values have been consistently higher in Kamloops than in Prince George.
Furthermore, the average value of residences has increased by 75.6 percent in
Kamloops and by only 31.5 percent in Prince George during the period under study.
Employment levels have also followed a similar trend. The number of total
employed (15 years and over) has increased only slightly in Prince George since
1996 (0.7%) while Kamloops experienced a growth of its employed population
(13.9%) superior to its population growth (5%), suggesting a rather healthy
economy.

Meyer and Hecht use manufacturing employment as an indicator of
the intensity of the traditional industrial economy. At first glance, economic
transition appears to be well underway in Kamloops and Prince George: both
cities recorded a sharp increase in the number of workers employed in the
manufacturing sector between 1996 and 2006. The decline in Prince George
(-27.4%) has been noticeably far more significant than in Kamloops (-12.3%)
a trend which may lead unknowing observers to believe that Kamloops has
been slower in restructuring its economy away from its traditional roots than
Prince George. However this has not been the case. The recent crisis in the
forestry sector has affected the economy of Prince George much more
severely than in Kamloops as population change, average value of dwelling
and employment level indicators seem to suggest. A larger proportion of the
total workforce in Prince George is still employed in manufacturing jobs(
5.6%) compared to Kamloops (3.5%), emphasizing the continued importance
of this sector of employment in Prince George’s local economy. In this
respect, Meyer and Hecht’s manufacturing employment indicator has been
proved to be unable to capture the subtle nature of the economic reality faced
by Prince George residents and may even lead to a misleading interpretation.
Meyer and Hecht use the growth in quaternary employment as an
indicator of the intensity and concentration of high tech employment in the
local economy. This is used as a proxy to assess the level of transitioning
experienced in a city towards the new, post – industrial, knowledge – based
economy. On this basis of the values in Table 1, this indicator indicates that
Kamloops economy has been successful in attracting or at retaining more
quaternary employment (increase of 25.4%) than in Prince George (increase
16.8%). This interpretation supports observations made earlier relating to
Kamloops early transition to the new high – tech economy.
Median income is used by Meyer and Hecht as an indicator of
overall level of economic well being in a population. Considering the nature of
the empirical differences that have so far been revealed between our two
case studies, this indicator brings in an element of contradiction. While
population growth, average income and levels of employment appear to
underline the precarious nature of the Prince George’ economic vitality and
the relative health of the Kamloops’ economy, the median income in Prince
George is consistently higher than in Kamloops during the decade under
study. The fact that the resource extraction sector pays on average higher
wages than in the tertiary and quaternary sectors where there is more part –
time and contract work, may help to explain this discrepancy between our
case studies. This indicator is probably the most misleading of Meyer and
Hecht’s indicators.

Conclusion
Overall in Canada, small cities like Kamloops and Prince George are
experiencing different rates of demographic and economic growth. The
objective of our research was to test if Meyer and Hecht’s (1996) economic
vitality indicators that were originally developed to study the impact of
university campuses as regional economic growth poles, could be used to
provide researchers with a simple method of empirically and objectively
analyze the demographic and economic vitality of small Canadian cities.
Results have shown that while certain indicators such as population change,
average value of dwellings, employment rates and quaternary employment
appeared to correctly index the trends observed to exist between Kamloops
and Prince George , others like manufacturing, employment levels and
median income levels were less successful, even misleading.
Results from this research also make us question the wisdom of
undertaking a vast analysis of the economic vitality of small cities from a
small number of simple indicators. As shown, it is impossible with just a few
indicators to fully capture the complexity of regional economies and to assess
the nature and the timing of the transitions they may be experiencing. Smaller
scales, regional analyses informed by a strong knowledge of local economic,
demographic, and social conditions may be a superior tactic in assessing the
economic vitality of small cities, than the system – wide solution originally
sought after by our research.

Conclusion
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