Vancouver’s Employment Lands and Economy Review – External Advisory Group Meeting #2 April 9 th , 2019 Hemson Consulting Ltd.
Purpose of the Employment Forecast • Key focus is understanding potential demand for employment space and land • Outlook considers both jobs and space required for future economic activity in different land use categories • Test range of outlooks against Vancouver’s current land capacity
Key Employment Land Categories Population Related Major Office • Typically free standing office • Primarily serves local resident • Greater than 20,000 sq.ft. population & tourism sector • Distributed across a few major • Includes retail, hotels , regional agglomerations restaurants, small offices Institutional Employment Areas • Typically accommodated in low • Serves local and regional rise industrial type buildings population • Includes factories, distribution • Includes education, health warehouses, business parks care, local government
Key Study Outcomes • Forecast regional Scenarios Forecast Forecast Total Employment employment by land use category Jobs by Sector Population Employment Major Office Institutional • Allocate to City by share Related Areas and estimate floor space Demand Space Population Employment Major Office Institutional Related Areas • Compare against City’s development capacity Capacity Analysis Population Employment Major Office Institutional Related Areas • Identify gaps Analysis Gap Identify Capacity Gaps
Approach to Employment Forecasting • Forecasts for employment typically conducted at regional level (top down), then allocated locally based on local indicators and capacity (bottom up) • Consider different scenarios to understand range of possible outcomes • Reference (status quo) scenarios often serve as baseline for policy testing and development • Alternate scenarios allow testing of ‘what if’ outlooks to evaluate resiliency of policy options
Benefits of Scenario Planning • Compliments conventional planning approach by going beyond forecasts of current trends • Considers other fundamental shifts that could emerge via external forces beyond jurisdiction’s control Alternative 2 • Enables means to evaluate potential impacts and policy resiliency to future challenges and opportunities
Scenario Testing for Policy Planning • Can we meet demand under current trends? • Do we need more land? • More density? • More protection? • More flexibility? • How do these questions change if demands change? • What happens if there is not enough land?
Alignment of EL&ER Outlook with Regional Forecasts Metro Vancouver Reference Forecast • Metro Vancouver & Translink Guides currently preparing long-term Aligns with forecasts of population, housing and employment City of Vancouver Employment Forecast: Reference Scenario • Work to align with regional Reference forecast as starting point Vancouver Vancouver Alt. Scenario Alt. Scenario No. 1 No. 4 • Development of Alternative Scenarios for City of Vancouver to reflect local Vancouver Vancouver Alt. Scenario Alt. Scenario vision, priorities and concerns No. 2 No. 3
Starting Point: Reference Scenario Reference Scenario: Key Assumptions • Based on current trajectory of Demographics Population continues to age, with most growth Vancouver and Region due to net in-migration Employment to population rate declines as • Recognizes impact of forces Employment population ages, gradual increase in senior (65+) work force, in-migration meets labour force needs we are confident will adjust Regional sectoral activity and employment current trends Economy remains relatively consistent, Vancouver gradually shifts towards office and population serving • Designed to represent most Climate change impacts are managed/impacts are Environment likely outlook for policy mitigated within existing policy tools testing Current trends persist in most areas, employment External impact of disruptors limited or offset by growth in Forces other sectors, continued stability in policy
Preliminary Reference Forecast Outlook Draft Forecast Employment Growth, by Type, City of Vancouver, 2016-2051 600 Thousands 500 400 Employment 300 200 100 - 2016 2021 2026 2031 2036 2041 2046 2051 Axis Title Primary and Industrial Commercial Services (Population Serving and Major Office) Social Institutional Source: Metro Vancouver. Note: Figures are from current working draft projections and are not final.
Alternative Scenario Development • Objective is to develop range of high and low outlooks to stress test policy responses for resiliency • Very high and very low outlooks included as reasonable bookends • Don’t have to be ‘right’, instead represent a range of potential outcomes by shifting assumptions for specific external forces
Potential Scenario Examples Reference Scenario Very Low Scenario 2016 2021 2026 2031 2036 2041 2046 2051 Year Note: Ranges shown are for discussion purposes and may not represent actual forecast results
Alternate Scenario Development: External Forces Force B • External Forces are trends or disruptors Example: Scenario anchored by Force A with the potential to change the trajectory of growth and land use in the Force A City and region • Analysis of external forces and their potential impacts a key component of developing forecast scenarios Force C • Certain external forces may be intrinsically linked, or may offset other external forces and factors Force D
Consideration of External Forces • The study team has reviewed a range of external forces, narrowing down the list based on likelihood and potential impact to Vancouver and the surrounding region • The following list are a sample of some broad external factors that could influence future job growth and how much space we need: • Unaffordable Housing & Space • Labour Advantages • Increased Automation & AI • Alternative Work Arrangements • The Digital & Creative Economy • Climate Change • Changes in Global Trade
Unaffordable Housing and Space Description Factors Example of Potential Impacts • • Refers to various factors Real estate Residents and businesses look that are limiting affordable dynamics further out in region for space for residents and affordable space • Changing businesses that may • interest rates Reduced local labour pool displace or hinder growth growth discourages investment • Foreign opportunities. across various sectors investment Increased Automation and AI Description Factors Example of Potential Impacts • • Refers to automation Autonomous Reduced labour demand in (including AI) resulting in vehicles various sectors reduced labour needs in low • • Advances in Creation of new demand in and high skilled sectors. May building tech other sectors not necessarily result in • • Introduction Increased floor space per worker reduced economic activity or of AI in some areas need for space.
The Rise of the Digital & Creative Economy Description Factors Example of Potential Impacts • • Refers to macro level shifts E-commerce Increased demand for office towards digital, creative and jobs and space • Internet of high skill sectors, along with • Things Decreased demand for brick impacts of increasing digital and mortar retail space sales and connectivity on • Increased transportation and various other sectors. logistics demand Changes in Global Trade Description Factors Example of Potential Impacts • • Refers to factors that could International Transportation and logistics increase or decrease volume policy employment up or down of trade through Vancouver, • • Protectionism Changing space need for container including policy changes or or materials related storage • Shifts in change in demand, such as • energy types Knock-on effects to various port- shift towards renewables. adjacent employment sectors
Changing Labour Advantages Description Factors Example of Potential Impacts • • Refers to the competitive Global Increased demand for satellite advantages and disadvantages outsourcing offices of global companies Vancouver has in attracting • • Comparative Increased in-migration of skilled business through high skilled labour costs workers and comparatively affordable • • Migration Risk of outsourcing of other labour. policies sectors being outcompeted Alternate Work Arrangements Description Factors Example of Potential Impacts • • Refers to the rise of non- The gig Increase in tourism activity but traditional employment economy negative impact on some hotels arrangements, including • • The sharing Reduced demand for long-term contract and gig based work, economy office space as people choose to as well as co-working and work from home, or use co- • Disruptive disruptive delivery models working space technologies (AirBnB, Uber, etc.)
Climate Change Description Factors Example of Potential Impacts • • Factors related to climate Increase forest Reduced activity from low laying change with specific regard fires and waterfront employment to their impact on business activities • Sea level rise activity or potential to • Increased instances of flooding • Global climate compromise the City’s and forest fires negatively refugees employment land supply. impact tourism
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