Diversify!
When AbitibiBowater shuttered its Dalhousie pulp-and-paper plant in 2008, Mayor Clem suddenly found himself at the helm of a company town that had lost its company. 

It’s no secret that areas with diversified economic bases have been more resilient to the impact of the global recession. In his efforts to steer Dalhousie away from its historic reliance on an increasingly troubled forestry sector, Mayor Clem can look to other towns that have already made progress in their diversification efforts.

Sept-iles, Quebec
Situated on Quebec’s Lower North Shore, the town’s fortunes were long tied to iron ore – but when global iron ore production collapsed in the early 1980s the town’s jobless rate increased accordingly. “We witnessed a significant exodus at the time, with lots of local building empty and boarded up,” says Sylvain Larivière, the town’s economic development officer. Adding to the problem was a decline in the local fishing and forestry sectors.

"In addition to lobbying various levels of government for support, we had to mobilize our citizens – to work with them to devise dynamic strategies to bring new players into the area."

In 1992 the aluminum manufacturing company Alouette launched development operations, creating several hundred jobs. It expanded in 2006, adding an additional 340 positions, and by 2010, the company was employing 1000 people.

Then in 2009, with a view to developing local tourism, Sept-iles undertook a major refurbishing of its port facilities, allowing it to accommodate cruise ships. Three have already called at the port in 2010.  The federal government has invested $10 million in further modernizations, at Pier 31 in Pointe-Noire, with the aim of tripling the number of visiting ships in the coming years.

Among other diversification initiatives that Larivière indentifies are numerous recently established operations dedicated to the production of blueberries and other small fruit.

A vital component of Sept-ile’s diversification strategy takes place on the educational front. “We’re making an effort to equip our Cegep and university with research facilities that benefit the area,” says Mayor Serge Lévesque.

Thetford Mines
It’s a similar story in Thetford Mines. As its name suggests, the town was built on mining, following the discovery of important asbestos deposits in the area – but only one of the nine mines that operated in 1970 is still functioning.

“At one time, several thousand people - pretty much everyone in town – were employed directly or indirectly by the mines,” says Marc-Alexandre Brousseau, an economic development commissioner in the region. A subsequent decline in mining, compounded by the 1990 recession, destroyed scores of local jobs.

“We established a committee dedicated to diversification, drawing upon expertise from a range of sectors,” says Brouseau. “It was a way of breaking barriers – of getting people to look beyond the immediate needs of their sector or company,  and to consider the entire region.”

The result was the creation of hundreds of small businesses throughout the area.  “One of these now employs 300 people,” says Brouseau.  “It’s one of the region’s most important employers.”  The sole remaining mine still employs about 400.

The recession & its impact
In both Thetford Mines and Sept-iles, economic diversification seems to have softened the blow of the recession.

 “Local businessmen joke that the recession drove straight along Highway 20 without coming into town,” says Brosseau. “The economy did slow a bit, and some part-time workers were laid off – but no businesses had to close. In fact, given that we’d had short of labour prior to the crisis, the recession has reset the balance a bit. The 2010 jobless rate has returned to pre-crisis levels of roughly 6%. Economic activity has resumed, the commercial vacancy rate is zero, and there are record levels of residential and commercial construction. Our biggest challenge right now is attracting more workers to the area, so we anything but defeatist.”

The situation has been harder in Sept-iles, where mining-related businesses felt the blow and some infrastructure updates were postponed. “Natural resources remain an important part of our economy,” says Larivière, “but the iron ore and aluminum industry are usually on different trajectories, so when one  suffers,  the other usually is doing fine.”

“Yes, we felt the effect,” says Mayor Lévesque, “but diversification helped us keep our head above water.  Local unemployment was contained at 9%. Were it not for aluminum production, which remained stable, we would have had a more difficult time. As it is, we were already taking about economic recovery in September, 2009.”