Thunder Bay Municipal Election Issues: Crime

The October 22^nd municipal election in Thunder Bay should start heating up as we move into the final four weeks of the campaign.  There are indeed quite a few campaign signs sprouting up and in a sign that the race has intensified there is even some campaign sign vandalism.  On the one hand, having a large number of candidates should make for an interesting race but on the other hand with so many candidates, any real debate is going to be unwieldy to manage and I expect the final outcomes will largely favour incumbents with name recognition.  This means that despite what seems to be an enormous appetite for change, there will be very little come the day after October 22nd.  Still, one would be remiss on not trying to highlight some of the issues.

In my August 8^th post, I did a brief summary of what the main issue categories  in the coming election should be and today I want to focus on one specific issue in particular – crime in Thunder Bay.  There is a lot of social media discussion as well as media reporting on crime in Thunder Bay and also a lot of informal chatting among people and concerns have been expressed about what seems to be substantial drug driven gang activity.  There are also statistics that measure crime and Statistics Canada has reported recently that Thunder Bay in 2017 leads Canadian cities in their murder rate for a second year in a row.

The police response to this news by the Acting Police Chief acknowledged the high homicide rate but the media report also noted that “Despite having the highest murder rate per capita for Canadian metropolitan areas and the second highest in terms of severe crimes, the overall crime rate in the city of Thunder Bay is down.”  The response of the Acting Chief accentuated the positive with the comment that “"Those numbers are great to see," Hauth said. "I think it’s continued work internally and working with outside agencies. We’ve made great strides in terms of doing things in the community."”

So what do the numbers look like?  Well, there are specific traditional crime rates for assorted offenses and incidents with the overall crime rate in terms of incidents per 100,000 of population actually down in 2017.  There is also what is known as the crime severity index which uses a weighting method to account for both the number of crimes and their severity.  There sometimes is confusion in media reports between the crime rate and the crime severity index and the confusion mounts if one goes up while another goes down.  However, if one looks at longer term trends, both sets of number tell a similar story.  Crime overall has come down in Thunder Bay over the last 15 years, but certain types of crime have actually gone up.  In particular, violent crime and homicides in particular.

In the case of Thunder Bay, the overall crime rate in 2017 declined from 6,771 incidents per 100,000 in 2016 to 6,576 incidents per 100,000 – a drop of 2.9 percent.  Since 1998, the overall crime rate in Thunder Bay has declined from 10,911 incidents per 100,000 to the current 6,576.  However, the homicide rate has exhibited an opposite trend going from 2.6 homicides per 100,000 in 1998 to 6.04 per 100,000 in 2017.  When it comes to crime severity, the accompany figure sums it all up quite nicely. 

 

The overall crime severity rate (with everything relative to a base of 100) was quite stable from 1998 to about 2010 and then fell and has stabilized since 2012.  For 2017, the crime severity index is up from 87.48 to 88.25- an increase of about 1 percent.  The decline in the crime rate however is being driven by the fall in the rates of non-violent crime.  What is more alarming is the increase in violent crime which in 2017 is the highest it has been since 1998. 

We can argue that crime rates are down overall, but the concern of the public is that violent incidents – homicides, assaults, etc… seem to be on the way up.  Drug possession or a vehicle theft is a problem, but the public is more perturbed by gang and drug related violence and homicides. The issue facing municipal candidates is what solutions can be offered to deal with the rising rates of violent crime in Thunder Bay?  And to help frame the discussion in a simple manner amenable to most municipal candidates, should solutions involve more resources to police or more effective use of existing resources and what should those solutions be?

Wealth and Debt Accumulation in Early Financial Markets Stockholm Conference

I had the privilege of attending along with nearly 50 other participants  the "Wealth and Debt Accumulation in Early Financial Markets" conference that was held at the Stockholm School of Economics September 13-14.  The conference was organized by Elise Dermineur (Umea University/Stockholm School of Economics) and Håkan Lindgren (Stockholm School of Economics) who are both affiliated with the EHFF Institute for Economics and Business History Research at the Stockholm School. The conference united researchers working with a variety of historic sources of data on credit, wealth and debt but with very strong representation from probate inventories - an area that I have spent nearly thirty years working with.  

 

Conference attendees were welcomed by Lars Strannegard, the President of the Stockholm School of Economcs and keynote addresses were by Carole Shammas (USC)  titled "Why Did Finance Professionalize" and Phil Hoffman (CIT) titled "Dark Matter Credit".  Along with paper sessions, there were also two round tables.  On the Thursday, there was "The 'Market' as a Concept" which was moderated by Kristina Lilja (Uppsala) and the Friday afternoon saw "Women and Early Financial Markets" moderated by Ann McCants (MIT).  The conference wrapped by with a discussion and plans for future collaborative international research moderated by Anders Perlinge (Stockholm School of Economics).  

It was a lively, well organized and well attended conference with a lot of participation and interaction.  It was frankly rewarding to see so many researchers working in areas similar or parallel to mine and with similar types of data.  The strong resource base provided by Swedish probate records was particularly impressive and it is due to the hard work and initiative of Swedish researchers as well as generous research support.  The research into probate inventories as well as support for the conference comes from the Handelsbanken Research Foundation, the Wallenburg Economic History Foundation, the Marcus Wallenburg Foundation for International Scientific Collaboration, the Jacob Wallenburg Foundation, the Ebbe Kock Foundation, the Gunvar and Josef Aner Foundation, and the Swedish Foundation for Humanities and Social Sciences.  

Let me conclude with a warm thank you to our hosts and research supporters or as they would say in Sweden - tack så mycket - and end with a few pictures from the conference.

 

What's Wrong With This Picture?

Well, Northern Economist is in Northern Europe on the way to a conference in Stockholm later this week. It is a lovely Sunday afternoon here with families out strolling enjoying the mild September weather in a major European city – Copenhagen to be precise.  The number of people out today in Copenhagen has been augmented by the holding of a Every Step Counts walk for the environment and the paths along the canals are packed with walkers as well as tourists.

What is also interesting about the canals is scenes like the one below:

 

Numerous boats are out with groups of people sitting around a table enjoying snacks and the passing scenery as they boat along.  Notice anything interesting about this picture?  Well, it turns out that Copenhagen seems to be a lot like Vegas when it comes to open carry alcohol.  Not only can you walk the streets while enjoying a beer but you can drive a boat while partaking in wine and beer also.

It is very important to drink responsibly but I do not think that responsible drinking is incompatible with drinking in public.  You certainly could not get away with drinking and boating in Canada but one wonders how it is that Denmark - and indeed much of Europe - can handle this but we in Canada cannot despite our socially liberal pretensions.  The canals in Copenhagen are quite crowded and yet here we have groups of people enjoying picnic lunches and wine while boating along. I won’t even get into a discussion of why Denmark has tons of people on bikes and yet no one seems to be wearing a helmet.

Perhaps Danes and Europeans in general are more mature and able to take more personal responsibility when it comes to personal safety?  It is certainly something I will think about some more over the next few days. However, in the absence of truly innovative change we in Canada will just have to bear with things the way we are.

Northern Ontario Economic Forecasts: Conference Board Forecasts Slower Growth for Thunder Bay and Sudbury

The Conference Board of Canada recently put out its Summer 2018 Metropolitan Outlooks for Thunder Bay and Greater Sudbury.  Greater Sudbury’s real GDP growth is expected to be 1.2 percent in 2018 and 1.1 percent in 2019 while its employment growth will be  -0.4 per cent in 2018 and rise 1.1 percent in 2019.  Meanwhile, Sudbury’s unemployment rate will rise from 6.7 per cent in 2017 to 7.0 per cent for 2018, before falling to 6.6 per cent next year.  Thunder Bay’s real GDP is expected to grow 1.2 percent in 2018 and 1 percent in 2019 with employment expected to rise 2.2 percent in 2018 but fall -0.7 percent in 2019.  The unemployment rate is expected to be lower than Sudbury’s at 5.1 percent in 2018 compared to 5.6 percent in 2017 but is expected to be 5.4 percent in 2019.

As the accompanying figures show, Thunder Bay and Sudbury have been growing more slowly and are expected to grow more slowly than Canada or Ontario.  Sudbury’s economy has been described as “unsettled” with a steady string of employment losses over the last few years.  Its primary hope is the current rebound in nickel prices given the employment losses have been hitting its mining sector.  


 



 
Thunder Bay saw a very good employment growth performance in 2017 that basically helped recover from the 3 percent drop in 2015 – its economy currently can be characterized as “moderate expansion.”  What seems to be driving things at the moment in Thunder Bay s a stronger construction sector with numerous small non-residential projects as residential demand is weak.  Indeed, the housing forecast for 2018 is 155 units – the lowest number of starts in 15 years.  As well, there has been some upturn in manufacturing and transportation.  

So, moving forward.  It appears that both Canada and Ontario are expected to see slower rates of economic growth moving towards 2020 with Thunder Bay and Sudbury even lower.  In terms of employment growth, Sudbury’s recent string of low employment growth is expected to end in 2019 if nickel prices continue their rebound while Thunder Bay in 2019 is expected to see negative employment growth again before resuming growth.  Thunder Bay’s economy has been performing marginally better than Sudbury’s recently as it is somewhat more diversified as in 2017 it had a higher economic structure diversity score of 0.78 compared to Sudbury’s 0.71.

Prelude to Municipal Election: Thunder Bay Economic Overview

As the election campaign for Thunder Bay Mayor and City Council begin to heat up, there will be attention focused on how Thunder Bay’s economy has been doing over the last four years.  The Conference Board and Statistics Canada both provide data for  quick snapshots about how Thunder Bay has done since 2014.  First, real GDP numbers for Thunder Bay (in 2007 dollars) from the Conference Board show that the city’s economy since 2014 has grown at annual rates ranging from a low 0.7 percent in 2015 to a high of 1.4 percent in 2017 with a forecast growth of 1 percent in 2018.  While the local economy is growing, its growth rate is well below that for Ontario and Canada which in 2017 alone saw real GDP growth at 3.2 and 3.1 percent respectively according to the Conference Board. Indeed, out of 29 CMAs in 2017, Thunder Bay ranked second last in real GDP growth – just ahead of St. John’s which saw growth of -1.7 percent.

It turns out that in the wake of the 2014 municipal election, growth faltered in Thunder Bay and that is also borne out by the employment numbers.  According to Statistics Canada, Average monthly employment in 2014 was 61,608 and fell to 59,650 in 2015 and then began to rebound (see Figure) and to date in 2018 averages 61,967.  So, this suggests that the last four years have seen just over 300 jobs added to the Thunder Bay economy which works out to about 75 jobs a year.  (By the way, don't be fooled by what looks like dramatic employment growth since 2015 - after all, the scale on the Figure ranges from 58,000 to 62,500) However, this masks the ebb and flow across sectors.  Manufacturing, public administration, finance, insurance and real estate employment have all declined while there have been increases in accommodation and food services, transportation and warehousing and retail.  Other sectors have been stable.

 

The shrinkage of employment in the finance, insurance and real estate sector is a function of declining house sales and weak housing starts.   As the Conference Board noted in its Winter 2018 Outlook: “Thunder Bay’s uneven economy and slumping population have impaired residential construction. While housing starts clocked in at just under 300 units last year, this was due to an upswing in construction of multi-family homes, particularly apartments, which are relatively infrequent here. Tellingly, CMHC data show that area builders have had no unsold apartments since August 2016. Such projects are risky in an economic environment like Thunder Bay’s, so builders wait for pent-up demand to accumulate, then pre-sell their units.”

What is also interesting is the comparison of employment between Thunder Bay and Ontario as a whole.  In 2016, according to the Conference Board, 16 percent of employment in Thunder Bay was industrial versus 20 percent for Ontario.  As for office employment, it was 20 percent in Thunder Bay and 28 percent for Ontario.  At 5 and 15 percent respectively, the shares in Transport and Warehousing and Wholesale and Retail Trade are the same as for Ontario as a whole.  However, when it comes to non-commercial services (i.e., health, education and public administration), Thunder Bay’s employment share is 27 percent compared to 19 percent for Ontario. When it comes to other services (arts, entertainment, recreation, accommodation and food) Thunder Bay is at 16 percent compared to 13 percent for Ontario.

So, the long and short of Thunder Bay’s economic performance over the last four years is that while not a disaster, it has been uneven.  Real output growth has been weak and total employment has essentially remained stable and within that there is a shift to services particularly of the non-commercial variety meaning more emphasis on public as opposed to private sector employment growth. The lack of population growth combined with an aging population has led to a weakening of the housing sector. That is the current reality.