Economic Development Journal of Canada | Economic Development Journal of Canada, 2012
Originally published November 24, 2012

The Creative Economy – An Opportunity for Rural Revitalization

Anya Codack
President - Yfactor

Recent research has documented the economic, demographic, educational, and social decline of Canada’s rural communities. Many factors, including youth out-migration, an aging population, lower incomes, a smaller tax base to pay for services delivered over long distances, fewer educational and cultural opportunities, a less-educated workforce and an employment base whose traditional agricultural and manufacturing roots are undermined by globalization, are contributing to this dramatic shift in rural life. As traditional economic bases erode, rural communities are seeking new solutions to economic sustainability.

In 2008, The Monieson Centre at Queen’s School of Business launched a 3-year Knowledge Impact in Society (KIS) project to support economic revitalization in rural Eastern Ontario by mobilizing academic tools and resources. Through a KIS-related series of 24 community consultations in Eastern and SW Ontario, the creative economy was identified as a key knowledge gap related to rural economic sustainability and vitality. Partnerships between The Monieson Centre, other academic institutes, and community organizations enabled a multi-faceted approach to addressing this key research need. This article draws on this partner-based research to offer an introduction to the creative economy’s potential to support rural economic revitalization.

The Creative Economy – An Emerging Economic Development Issue

Funded by the Social Sciences and Humanities Research Council of Canada (SSHRC), the KIS project built a collaboration between The Monieson Centre, two lead partners – the Prince Edward/Lennox & Addington Community Futures Development Corporation (PELA CFDC) and the Eastern Ontario CFDC Network, Inc. – and almost 40 supporting community partners. This network facilitated 16 Discovery Workshops across Eastern Ontario to identify economic development priorities and research needs. The Assessing Rural Research Priorities through Community Engagement project, funded by the Ontario Ministry of Agriculture, Food and Rural Affairs (OMAFRA) through the University of Guelph School of Environmental Design and Rural Development, and conducted in partnership with The Ontario Rural Council (now the Rural Ontario Institute), allowed for an additional eight Discovery Workshops in SW Ontario.

Through these community consultations, The Monieson Centre identified the creative economy as a key emerging economic development research issue. It was ranked as the 15th-most pressing rural research need (12th in SW Ontario and 18th in Eastern Ontario); however, delegates at the 2009 KIS Showcase identified it as the single most important issue in need of further research. This was a reflection of how forward-thinking communities are pursuing the creative economy as an innovative approach to economic revitalization.

Richard Florida of the Martin Prosperity Institute (MPI) has initiated a growing body of research around this economic development theory which, he argues, offers a new path to economic prosperity. Ontario’s communities have been given a distinct impetus to better understand this issue following the publication of Ontario in the Creative Age, an MPI study commissioned by the Ontario Government to explore provincial policy implications of this emerging sector, namely, to “provide recommendations to the Province on how to ensure Ontario’s economy and people remain globally competitive and prosperous.”

The MPI study traces the overall decline of traditional, physical labour-intensive jobs in Ontario, including both industrial jobs like manufacturing, and traditional rural jobs in the agricultural and forestry sectors. The new Western economy, Florida argues is based on the emergence of the service sector and the creative sector – the latter including jobs in which people are paid to produce intellectual capital.

Jobs in the creative economy, then, include:

Rural communities have wrestled with the implications of government policy regarding the creative economy for their local economies. The Discovery Workshops uncovered difficulties in defining the creative economy, building a broader understanding of its nature, and developing an awareness of the issue beyond economic development circles. Definitions of the creative economy do vary; however, a consensus does seem to be emerging. Some definitions include:

“Those industries which have their origin in individual creativity, skill and talent and which have a potential for wealth and job creation through the generation and exploitation of intellectual property.”
“At the heart of the creative economy lie the creative industries. Loosely defined, the creative industries are at the crossroads of the arts, culture, business and technology. In other words, they comprise the cycle of creation, production and distribution of goods and services that use intellectual capital as their primary input.”

In Eastern Ontario, a collaboration led by the Eastern Ontario CFDC Network, Inc. studied the local creative economy and defined it as, “A major shift in the structure of the global economy – from one based on the production of goods to a more knowledge-based economy driven by ideas and innovation.” As an economic development strategy, then, the creative economy does not focus only on those occupations traditionally branded “creative” – namely those related to arts and culture – but, rather, casts a broader net encompassing all knowledge-based occupations as well.

While the promise of high-paying creative occupations is attractive to rural communities seeking new models for sustainable economic development, the existing body of knowledge is largely urban-based. This challenge is compounded by the core recommendations of the MPI report for the Provincial government. Their policy recommendations focus on four key strategies:[12]

  1. Harness the creative potential of Ontarians by raising the creative content of Ontario’s occupations. This involves a significant labour force shift from physical skills to analytical and social intelligence skills.
  2. Broaden the talent base. Economic development in the creative economy is driven by “3T’s”: Tolerance, Talent & Technology. To attract and develop creative class workers, Ontario needs to continue to develop a tolerant society, as diverse viewpoints and lifestyles tend to increase innovation. Likewise, investment needs to be made in labour force training and development, as well as in continually improving technology, both of which foster creativity and new ways of doing business.
  3. Establish new social safety nets by connecting vulnerable groups through education. Creative occupations tend to require higher education levels than physical task-based and service occupations. Those without sufficient education become increasingly economically disadvantaged. In this context, social programs will need to focus on improving access to education.
  4. Build a province-wide geographic advantage by focusing on development initiatives on three “mega-regions”: the Greater Toronto Area, Kitchener-Waterloo, and the National Capital Region. Focusing economic development efforts in these mega-regions can help create geographical industry clustering which has been linked to the growth of the creative economy. Rather than viewing multiple businesses in similar industries as competition, economic developers can help such organizations collaborate to allow for innovations that would not occur in isolated firms.

This policy shift creates many challenges for Ontario’s rural communities, particularly Eastern Ontario. Already, at $53,345 Eastern Ontario’s wages lag behind the Provincial average of $55,626. Likewise, the region’s employment rate of 58.5% is lower than the Provincial rural average of 61%. In addition to these current disadvantages, “education and skills training” was identified as a top ten research gap and economic development issue in the Discovery Workshops, and was also noted as a challenge in the Senate Report on rural poverty, placing rural communities at great risk in this new economic landscape. Often without access to a first-rate education, rural communities fear they may simply fall victim to the new social safety nets discussed in these policy recommendations. Compounding this difficulty is rural Ontario’s geographical relation to the developing mega-regions. If provincial economic development efforts are targeted at these three urban areas, rural Ontario could be at an even greater disadvantage. Thus, while growing the creative economy creates possibilities for economic revitalization, these urban-based policy developments can be viewed as posing a significant threat to the province’s rural communities.

The Creative Economy in Prince Edward County – A Rural Case Study

Despite these challenges, several Eastern Ontario case studies demonstrate how creative economy theory can apply in rural contexts and assist rural communities. Indeed, they reflect the growing body of research indicating interdependence between rural and urban Canada, particularly in metro-adjacent rural regions that deal with workforce mobility, urban sprawl, environmental protection, and transportation issues. They offer lessons for economic revitalization in both traditional and emerging industries, and how rural businesses can succeed by capitalizing on urban connections. Here, we focus on Fifth Town Artisan Cheese and WhistleStop Productions.

Fifth Town is an innovative cheese producer in Prince Edward County. Founded in 2008, the business exemplifies the valuable intellectual capital and innovation that can bring to a traditional industry. Fifth Town is an environmentally and socially responsible business, positioned as a niche producer of quality handmade cheeses that are made using locally produced goat and sheep milk. The market for artisan cheese is growing at 20%/annum, far exceeding the industrial cheese growth rate of 1-3%, and the industry is underdeveloped in Ontario, with only 10 Ontario producers in 2008, compared with over 85 in Quebec.

Capitalizing on this market opportunity, Fifth Town exhibits key characteristics of creative economy-based businesses, all of which have contributed to its growth and success. First, its geographical context has nurtured the 3 T’s – tolerance, talent, and technology. While the County has a small minority population of 1.3% vs. the provincial average of 22.8%, they have developed social tolerance in other forms. Programs like the Arts Trail have encouraged a thriving arts scene. Likewise, the healthy tourism industry actively targets a diverse urban audience through grassroots organizations like “Out in the County.” While ethnic diversity takes long-term efforts to develop, these short-term initiatives help attract a broad range of perspectives and ideas to the region. This is also reflected in Fifth Town’s management philosophy. For example, staff profiles on the company’s website highlight the unique personalities, interests and talents of each team member.

Second, Fifth Town has placed a strong emphasis on developing talent. Founder Petra (Cooper) Kassun-Mutch relates, “We decided to do this because we wanted a bit of a change in lifestyle. We looked at the County as a ‘place,’ and we were interested in authentic foods as a theme, and we were interested in the environment as a challenge to sort of say, ‘what could we do to build the greenest enterprise out there?’” This approach to business is reflected in employee development programs. Many of the initial core team members were recruited from urban communities, with backgrounds in publishing, hotel management, and cheese-making. As the team grew, they recruited several new staff from within Prince Edward County. Fifth Town places a strong focus on employee retention, understanding that a talented, engaged workforce will generate new ideas to create long-term business sustainability.

Third, the business’s environmental commitment has led it to embrace technological development. Integrating environmental sustainability into every process has required creative solutions to many everyday business processes. Energy is produced on-site by a windmill and solar panels, with added energy sourced through the Bullfrog Power.

Economic Development Journal of Canada | Economic Development Journal of Canada, 2012