by Doug Elliot, publisher, Sask Trends Monitor and policy fellow, Johnson Shoyama Graduate School of Public Policy
In October 2012, the Saskatchewan government released a strategic plan for the medium term future, namely to the year 2020, called the Saskatchewan Plan for Growth. Many strategic plans, particularly the ones from governments, are full of lofty and motivational rhetoric but this one is different because it has quantifiable targets (along with lofty and motivational rhetoric). It is good public policy to set out a long-term vision, describe the means to get there, provide a way to measure progress, and be accountable; the provincial government should be commended for having the courage to attach precise figures to the growth plan. This article looks at some of the more interesting targets among the twenty or so in the document.
The size of the provincial population is the first of the goals in the plan with a target level of 1.20 million people by 2020. Figure 1 shows that this means the population will need to grow by an average of 1.3% per year from its current level of 1.08 million if we are to reach that goal.
This looks attainable when compared with the average increase of 1.4% per year from 2006 to 2012 but it will still be a challenge because it will require continued high levels of international immigration.
The plan has a target of 60,000 more people working in Saskatchewan by 2020. This is equivalent to an annual increase of approximately 7,500 per year or 1.3% per year in percentage terms, the same growth rate as in the population.
Once again, this target looks reasonable given the fact that employment grew by an average of 1.4% per year from 2001 to 2012 (and nearly 5% in early 2013). With employment growing at the same rate as population, the plan is implicitly assuming that the labour force participation rate will remain constant even as the population ages.
Another economic target in the document is to double the value of Saskatchewan’s exports. Assuming they meant that the value of international merchandise exports in 2020 will be double the estimated $31 billion in 2012, then the target would be $62 billion.
At first glance, this target also looks achievable. During the last nine years, the value of exports has grown by an average of 13% per year – reaching the target would require average annual increases of 9% per year for the next eight years (see Figure 3).
A closer look shows that this will be harder than it first appears. The growth from 2003 to 2012 was mainly because of the boom in commodity prices. In 2003, crude oil was selling for $US31/barrel, a third of the $US94 level in 2012. From 2003 to 2012, prices increased by 12% for potash and 4% for farm crops – our other main exports.
No one expects commodity prices to grow as quickly in the next eight years as they have in the last eight years. Even if new potash mines come on stream by 2020, this target looks ambitious.
Crop Production and Food Exports
Two targets for 2020 are about agriculture. The first is a plan to increase crop production by 10 million tonnes by 2020. Using the five-year average of 27 million tonnes as a starting point this would mean crop production of 37 million tonnes in 2020. The best crops ever were in 2008 and 2009 and they produced 30 million tonnes (see Figure 4). Exceeding that level would require a massive increase in cultivated acres, fertilizer use, and irrigation. This target looks unattainable.
For the second, related, goal, the value of agricultural exports (including value-added agricultural processing) is targeted to increase from an estimated $10 billion in 2012 to $15 billion by 2020. In the unlikely event that the increase in crop production describe above is achieved, the increase in the value of exports should follow automatically. Without an increase in production or a doubling of value-added processing, however, reaching this target will require a significant and sustained increase in crop prices and they are already at record levels.
There are two targets related to education levels in the population. The first is to “lead the country” in grade 12 graduation rates by 2020. The second is to reduce the difference in high school graduation rates between Aboriginal and non-Aboriginal students by 50%.
There are several ways that graduation rates can be measured. Figure 6 shows what percentage of the population 15 to 24 years of age has completed grade 12 which is a good proxy for graduation rates. The ratio was 61% in 2012, ninth among the provinces. Note that these figures are from Statistics Canada’s Labour Force Survey which is not conducted on Reserve so the proportion is probably somewhat overstated.
If one assumes that the national average continues to increase, then 70% would be a reasonable target for the percentage of the population 15 to 24 years of age with at least grade 12. Figure 6 shows that even reaching the national average will take a significant effort. Leading the nation would be an extraordinary accomplishment.
Closing the gap between the Aboriginal and non-Aboriginal population will also be a challenge. In 2006, the most recent year available, the percentage of the population 15 to 24 years of age with at least grade 12 was 33% among those reporting an Aboriginal identity compared with 57% for the non-Aboriginal population.
Halving this difference will mean reaching a level of 58% for the Aboriginal population by 2020. The gap widened between 2001 and 2006 so achieving this target will mean a reversal in recent trends.
Size of Public Service
This is one of the few targets expected to be reached before 2020. The plan projects a 15% reduction in the size of the public service by 2013-14. This is difficult to quantify precisely because there are two ways to measure the number of civil servants (persons vs. FTE equivalents) and because the “public service” has many definitions. The base for the 15% reduction is not specified in the growth plan.
In Figure 8, we have shown the effect of a 15% decline (from March 2012) in the number of provincial government employees (persons employed on a full-time or part-time basis, not FTEs, and excluding contracted consultants) using Statistics Canada’s count of provincial government employees in “general government” – currently about 15,000.
If the number of provincial government employees declines to 12,500, this will be the lowest level since the restraint period in the mid-1990s. Given the assumed growth in the economy and the population since then, this will necessarily mean a dramatic change in the civil service e.g. more contracting out) or a cutback in public services.
There are lots of targets in the plan but several obvious omissions as well. There are, for example, no targets for an economic growth rate, no capital investment targets, and no mention of personal incomes. The plan devotes a good deal of attention to competitiveness but there is no indicator or target for productivity growth.
Overall, the targets are a mixed bag. If the intent is to make the targets aggressive but achievable, then the population and employment targets are the best example. We need to be careful about calling the targets impossible because many of Saskatchewan’s current indicators would have looked impossible eight years ago. Nevertheless, many of them, with the export targets and farm production levels being the best examples, clearly look to be unachievable. Unfortunately, so do the targets for high school graduation rates.
Source: Sask Trends Monitor from Statistics Canada data