The agriculture industry in the Okanagan has a far greater positive impact on the regional economy than anyone realizes, according to a professor with Okanagan College’s School of Business who has just received a national grant to conduct further investigation.
“The public only sees the primary products – what they don’t see is the value-added that contributes to the economy,” Lee Cartier said.
“What we’re looking at here is the industry cluster of agricultural products: wine, tree fruits, processing, manufacturers, stainless steel fabrication, equipment manufacturing, the service and support industries, the grower supply companies – all of this is the value chain.”
Cartier has received $25,000 from the Natural Sciences and Engineering Research Council of Canada (NSERC) to conduct his study, titled Rural Entrepreneurship and Industry Competitiveness: Value-Chain Innovation in the Agricultural Products Cluster since 2006.
His research will examine the region with a macro-economic focus, looking at local agriculture as an industry cluster – similar to other classic industry clusters like the Silicon Valley.
What’s curious, Cartier said, is that once agriculture is examined as a cluster it becomes clear that it outpaces overall economic growth in the Okanagan – not by much, but enough to be significant at 3.6 per cent growth, versus three per cent growth.
“What this research hopes to answer is why this is happening,” Cartier said. “I know I’m going to find innovation there, but what’s driving it?”
Cartier says not much is known in Canada about the role rural entrepreneurs play in regional economies. By taking a closer look at what is occurring here, rural entrepreneurs, and others with economic interests, could literally capitalize on the findings.
The difference can be exponential, he said. Case in point: the local wine industry, which Cartier researched in 2011 for the BC Wine Institute. His findings showed that while the wine grape growers contribute $28-million to the region’s economy, once the entire value chain is factored in, that contribution is closer to $250-million, which represents two per cent of the regional GDP.
"This means the primary producers – the vineyards – only comprise 11 per cent of the industry’s total value-added contribution,” he said.
“There is a real benefit to the agriculture sector seeing itself as a cluster, rather than as a collection of small wineries (for instance) in competition with one another. When an industry can see the entire value chain, it’s easier to determine the challenges they have to deal with, and what they haven’t tackled.”
To conduct the research, Cartier is partnering with Okanagan Villa Vineyards and Events Corp., which operates The Vibrant Vine Winery in Kelowna with data being collected through the coming months. Public presentations on the project will take place in February 2013.
The project is being conducted through NSERC’s College and Community Innovation Program under its Applied Research and Development Grants program. Cartier’s work marks the first time the College has received such a grant since NSERC (the largest research granting council in the country) made Okanagan College eligible in 2011.