Go West My Friend: Quantitative Tools for Examining Population Growth in Canada

by Derek Nawrot Prepared for Thomas Courchene, MAP 897: Directed Reading
November 2012

Canada, in- line with international growth trends, is gradually urbanizing. In 2006, approximately 80% of Canadians lived in areas classified as urban; a substantial increase from the post-World War II era when less than 50% of the population was considered urban. This continuing population shift, however, is unbalanced, and threatens not only future population growth and socio-economic gaps between those municipalities that have the resources to remain competitive or not, but also exacerbates a growing regional imbalance between the Western provinces and the rest of Canada, and intra-provincially, between primary hub cities and the more industry and commodity driven 2nd and 3rd-tier entities. Donald and Hall (2010) observe that one of the most striking findings from the 2006 Canadian census is that over 70% of Canadian urban systems are either slowly growing (36.1%) or declining (34.7%). They conclude that planners and policy- makers have long concentrated on intra-urban declivity such as brownfield redevelopment, downtown revitalization, etc., while the new reality, in addition to micro urban issues, is increasing inter-urban disparities between cities that are rapidly growing and those that are not. Returning to the 2006 census, this is evident in that 68% of Canadas population lives in one of Canadas 33 Census Metropolitan Areas (CMAs) and that almost 90% of the population growth in Canada since 2001, has occurred in these CMAs (Government of Canada Statistics Canada, 2008). 1 Growth is further being concentrated within the six largest CMAs (Toronto, Montreal, Vancouver, Ottawa-Gatineau, Calgary and Edmonton), which account for 45% of Canadas population, and which between 2001-2006, grew at a rate of 8%, double the rate for other CMAs (2008). The Conference Board of Canadas (2006) report on hub cities argues that economic growth in nine selected municipalities drives an even faster rate of

Statistics Canada defines a Census Metropolitan Area as consisting of one or more adjacent municipalities situated around a major urban core. To form a census metropolitan area, the urban core must have a population of at least 100,000. To form a Census Agglomeration, the urban core must have a population of at least 10,000. Statistics Canada, 2002

growth in smaller communities within the province or region. However 2006 census data for the categories of population, employment rate, median incomes and growth in specific job sectors, amongst others, shows this is truer for cities with close proximity to the hub cities. Municipalities in provincial hinterlands, especially in northern British Columbia, northern Ontario, Quebec, and some areas of the Maritimes, continue to face decline and increasing government subsidy. When Richard Florida writes of the Bohemian and Gay indexes and the creative class, it is certainly Toronto, Montreal, Vancouver and the other hub cities he is referring to, as opposed to Windsor or Shawinigan. The goal of this assignment is to use quantitative analysis in examining the variables and characteristics in determining and planning for population growth in Canadian cities. It also looks to indentify if the characteristics that determine population growth in Canadas 1 st tier cities are the same as those in the 2nd and 3rd tiers, as well as how they vary by region. What makes this assignment different from previous studies is its attempt to look beyond the traditional methods of growth (natural increase, internal migration, and immigration/emigration) to indentify some of the social-economic demographics that are determining population change in Canadian cities. This does not mean to discount the traditional methods, which are the basis for traditional growth models, but simply to understand how socio-economic variables factor in population growth. The first part of this assignment is the development of population growth models using multiple regression and Statistics Canada Community Profile information for the 2006 census. Regression analysis allows an analyst to observe patterns that may otherwise not be observed and provides a mean for hypothesis testing the determinants of population forecast accuracy ( Tayman et al. 2011). The same authors believe that other factors, in addition to population size and

growth rate, may be important in determining population forecast accuracy. These include economic conditions (e.g., job openings, wage rates, cost of living), social conditions (e.g., educational opportunities, racial discrimination), demographic conditions (e.g., age structure, ethnic composition) and environmental conditions (e.g., pollution levels, water supply). The goal is to best determine the relationship these other socio-economic factors have with differential rates of urban growth. Although it is impossible to determine all growth variables, it is possible to determine which direction these relationships are moving and the characteristics which represent positive (and negative) growth performance. The final model will be discussed in regards to its ability to estimate future growth areas in Canada. The second part of the assignment will look in-depth at selected socio-economic variables of the model and, through the use of descriptive statistics, observe trends in these variables. 2 This will provide a richer picture of how the data performs across the type of municipality (1st , 2nd, 3rd-tier) and regions. It will also allow us to return to the initial question of increasing inter-urban disparities to better understand if and how socio-economic characteristics factor and some general trends. Finally, although it does not relate directly to the immediate assignment, however is necessary to satisfy the requirements from MPA 805, a hypothetical cost-benefit analysis, will be performed in relation to a municipality, Okotoks, Alberta, potentially investing in designated growth areas.

Building a Population Forecasting Model Using Regression: A Brief Literature Review

Vinodrai (2010) accurately describes cities as dynamic and ever-changing, responding to and being shaped by economic, social, political, and cultural forces (p. 87). Despite the number of horizontal implications, population growth tends to be examined in isolated
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The data used is mostly from the 2001 and 2006 census unless noted. The reason for this is because the categories are fairly consistent, for measurement purposes, across both of the census. The only information that has been released to date from the 2011 census is population growth data and not socio -economic characteristics.

frameworks that tend to concentrate on the immedia te, traditional methods of growth (natural increase, internal migration, and immigration/emigration) or the individual analysis of socioeconomic variables such as employment rates, creative and arts communities, decline of manufacturing, etc. Chi and Voss (2011) observe that existing regression population forecast models tend to be built on theoretical foundations between population and relevant factors. However, they conclude, that these theories are taken inconclusively rather then conclusively. Indeed, there have been only a handful of studies that have attempted to cross-examine population growth with socio-economic characteristics using a regression model. Tayman et al. (2010) acknowledge that the evaluation of variables other than size and growth rate have seldom been addressed in the literature. However as opposed to using some of the socio-economic variables discussed previously in their study, they selected three explanatory variables (prior error, census division, and launch year) which they state does not contain information pertaining directly to these socio-economic variables but that may reflect their net impact. Although I have managed to find a couple studies that have used multiple regression, typically completed as reports as opposed to academic studies, Tayman et als remains important simply for advancing the use of regression as an analytical tool of population growth and for making the connections between population growth and other variables, as well as the amount and scope of the sample sizes (they covered 2482 counties in the United States between 19002000). One of the key findings of their study was that multiple regression models, as opposed to singular variable models, clearly did a better job in explaining variations in the precision of population forecasts. Also key to the findings was that adjusted R values rose steadily as explanatory variables were added (however it is important to remember that there were no more

than three explanatory variables whereas this assignment will attempt to add more to the model in order to explain as much as the adjusted R as possible). In utilizing a spatial-temporal regression approach to measuring population growth in small areas (e.g., census tracts, neighbourhoods), Chi and Voss (2011) find that a major shortcoming of regression population forecasts is that they generally ignore non-demographic factors (economic development, the surrounding natural environment) that are a part of the contextual region for which the population forecasts a re being made. The factors that these researchers do consider tend to be chosen through an unnecessarily narrow demographic perspective as opposed to a perspective informed by other theories and data sets. Therefore, the authors argue that regression forecasting models should incorporate demographic characteristics, socio-economic characteristics, physical infrastructure, environmental characteristics, cultural resources, and potential legal constraints. One of the most thorough attempts at this, which was not acknowledged by Tayman et al. likely because the focus is on economic growth and because there were only four sample cities used, is Glaeser et al.s (1995) study of how urban growth in U.S. cities between 1960 and 1990 was related to various socio-economic characteristics measured in 1960. Using income and population growth as independent variables, the study found that income and population growth are 1) positively related to initial schooling; 2) negatively related to initial unemployment and 3) negatively related to the share of employment in manufacturing. This is one of the better studies in providing a template for this assignment. Finally, Golant and Bournes (1968) study of growth in the Ontario-Quebec urban system was amongst the first to use regression to analyze relationships between the rates of growth and demographic, socio-economic, functional, and physical characteristics of municipalities. Prior to

the study, previous research on urban growth models had tended to concentrate on 1) Economic base multiplier models; 2) Regional and interregional input-output models; and 3) Gravity and income and potential models (Czamanski, 1964). Unlike these models, which emphasize economic analysis of specific sectors of urban and regional spaces, Golant and Bournes study focused on the spatial allocation of growth among urban centres and the evaluation of the relationship between growth rates and the cross-sectional characteristics of these centres. Similar to this assignment, the sample size was 70 cities in Ontario and Quebec. As well, a varied proportion of census data was included such as average income per family, percent of population with a university education, and number of dwelling units. The results found that the adjusted R was considerably higher or lower for Ontario and Quebec municipalities tested separately than for a model combining both provinces municipalities. The authors conclusion was that Ontario cities acted more consistently as a system in terms of allocation of growth. Because of the regional growth variation in this model as well as empirical knowledge that municipalities grow based on location, categorical/dummy variables are employed in this assignment in attempting to determine regional growth differences in Canada.

Data and Analytical Procedures

The regression portion of this assignment examines the population growth of Canadian cities using data from the 2006 census. It would have been ideal to expand the scope and include data from 2011 census; however the majority of social-economic data has, as of the time of this assignment, not been released. The 1996, 2001 and 2011 census are however, beneficial for analyzing overall change in variables in a longer period and these will be considered in the discussion using descriptive statistics.

The data inventory includes 73 municipalities across Canada with CMA and Census Agglomerate (CA) populations of 40,000 or more at the 2006 census. Categorical/dummy variables have been used to further indentify relationships linked to Type of City (1 st , 2nd, 3rdtier), and Location (West, Ontario, Quebec, Maritimes). 33 of the 73 municipalities are designated as CMAs. Figure 1 displays the proportions of each categorical/dummy variable and how they factor into the 73 municipalities. Figure 1: Categorical/dummy variables in pers pective

The terms 2nd and 3rd-tier are frequently used to describe urbanized areas that are smaller than the large metropolises that dominate regional or national economies, but there is no single accepted definition (Wachsmuth, 2008). Indeed, this definition changes per country. For example, some cities in China or India with millions in population, are still referred to as 2nd-tier. Even in comparison to the United States, figures in the range of 300,000 to 350,000 are often used to define a 2nd-tier city (Sweeney, 2004). Wachsmuth (2008) concludes Canadas only true 1st-tier cities are Toronto, Montreal, and Vancouver, with Calgary a future possibility. For the purpose of this assignment, a 1st-tier city has been defined according to the previously mentioned Statistics Canada (2008) report that finds that six cities (Toronto, Montreal, Vancouver, OttawaGatineau, Calgary, and Edmonton), have accounted for two-thirds of Canadas population growth between 2001-2006. These six cities are defined as 1 st-tier in this assignment. 2nd-tier is defined as having a 2006 census population between 100,000-1,000,000, a fairly large threshold. However this makes sense given that the 2006 CMA population of Edmonton is 1,034,945. The next closest in population, and the start of the 2 nd-tier categorization, is Quebec, which had a 2006 population of 719,153. So there is a more than 300,000 difference in population between

what constitutes a 1st or 2nd-tier municipality. The division between 2nd and 3rd-tiers is not as apparent and is drawn simply on the population divide of more or less than 100,000. A 3 rd-tier municipality is classified as 40,000 to 100,000. For the purpose of the assignment, there are 6 municipalities classified as 1st-tier, 30 as 2nd-tier, and 37 as 3rd-tier. Ultimately however, what is important to this assignment is not a proper categorization of municipalities based on their populations, but loose boundaries to identify general growth trends. Finally a regional variable has been added. Ontario, Quebec, and the Maritimes are empirically defined. The West encompasses the provinces of British Columbia, Alberta, Saskatchewan, and Manitoba. There are 24 municipalities categorized in the West, 25 in Ontario, 16 in Quebec, and 8 in the Maritimes. Growth is measured by the % of Population Change between 2001-2006, which acts as the dependent (y) variable in each of the models. Table 1 represents all the initial variables, and their codes, used in the regression model equations (for Statistics Canada definitions of each variable, please see Appendix C):

Table 1: Variables used in the Growth Models Dependent: % Population change 2001-2006 Independent: Total private dwellings (2006) Median age of population (2006) % average value of owned dwelling change (2001-2006) Median income - Persons 15 years of age and over (2005) Government transfers - As a % of total income (2005)
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POPCHG2001-2006

TOTPRVDWEL MEDAGE VALOWNDDWEL MEDINC GOVTRANS

Median monthly payments for rented dwellings (2006) Median monthly payments for owner-occupied dwellings (2006) % change of population classified as immigrants (2006) Postsecondary certificate, diploma or degree (2006) Employment rate (2006) % change in occupations unique to processing, manufacturing and utilities (2001-2006) % change in occupations in art, culture, recreation and sport (2001-2006) % change in occupations in trades, transport and equipment operators and related occupations (2001-2006) Independent Categorical/Dummies:

MEDRENT MEDOWN IMM EDU EMPRATE MANUFOCCU ARTSOCCU TRADESOCCU

Type of Municipality (1st , 2nd, or 3rd Tier) Location (West, Ontario, Quebec, Maritimes)

The following steps are used in building the regression model. 1. Data was initially collected on a number of variables from Statistic Canadas Community Profiles for the 73 municipalities for the year(s) 1996, 2001, 2006, and 2012. This was a very time consuming project which entailed accessing each community profile and copy-and-pasting the data into a Microsoft Excel spreadsheet. It is invaluable however in performing the regression analysis. There are approximately 280 variables in Community Profiles from the 2006 census. From this list, approximately 13 socioeconomic variables were subjectively chosen based on whether they would likely affect population growth. For example, the number of immigrants or median monthly payments

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are probably likely to affect population as opposed to marital characteristics, household size, or place of work status. 2. Initial, practice regression tests used the absolute value of population for a CMA/CA in 2006, not the % change, as the dependent variable. Despite multiple attempts to create a viable model, including a series o f length stepwise regressions, the coefficient for population remained extremely high. Although variables that contained multicollinearity were removed, it left a model with very few predicator variables. This proved to be one of the key challenges in determining socio-economic variables relationships with population growth. And perhaps why not many previous studies have been attempted. The dependent variable, therefore, was changed from population to the % in population change from 2001-2006, or POPCHG2001-2006. In addition, some of the independent variables were also changed to reflect percentage change between 2001-2006 as opposed to absolute numbers. 3. In order to determine which of the socio-economic variables are related to POPCHG2001-2006, their strength, and whether the relationship is positive or negative, two pre-regression tests were performed in Microsoft Excel in order to determine that no multicollinearity exists in the final model. Multicollinearity occurs when a strong linear relationship exists among the independent variables and renders interpretations of coefficients very difficult and often impossible (Semple, 2012). Stock and Watson (2010) use the term imperfect multicollinearity in describing when two or more of the regressors are highly correlated. If the regressors are imperfectly multicollinear, as they are in a number of the

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relationships in the tested variables, then the coefficients on at least one individual regressor will be imprecisely estimated. In order to mitigate this issue, Lehrer (2011) recommends that one may have to drop variables from the equation. As the objective of this modeling procedure is to generally observe relationships between population growth and socio-economic variables, it is possible to drop those variables that show very high levels of correlation without affecting the overall model. The dropped variables however, are still hypothesized to exert some influence over population growth; their potential effects will be further discussed in the analysis of descriptive statistics as will the Omitted Variable factor. The first test, for correlation, used Pearsons r Correlation

(http://faculty.quinnipiac.edu/libarts/polsci/Statistics.html) as a guide for interpreting the strengths of correlations. Independent variables were not included in the regression model if there appeared to be very strong positive or negative relationships ( r = +.70 or higher or -.70 or higher). There correlation calculation was performed with all the variables however this assignment is mostly concerned with the relationship between the independent and the other variables. The second test calculated the variance inflationary factors (VIF) utilizing a method by Semple (2012). Each independent variables VIF measures how much the variance of its coefficient estimate has been inflated by multicollinearity. The ideal VIF for a variable is 1, however Semple believes that one shouldn't often expect to see this value in practice (at least for work on observational data). A value of 4 or greater generally means that multicollinearity is a problem.

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Those selected predicator variables that did not show a high degree of correlation and had VIFs under 4 were then brought forth in building the regression model. 4. Various stepwise regression models were constructed using the selected socioeconomic variables as dependents. A 4-step process, adapted from Gupta (2006), determined the efficiency of each model. Each of the steps has been color-coded for reference using a sample model. i) The model was first examined for fit, or to see whether it is significant as a whole. This is done by observing the Significant F. If the Significant F is insignificant, that is if it is greater than 0.05 when tested with 95% confidence, than the model as a whole has failed.
SUMMARY OUTPUT Regression Statistics Multiple R R Square Adjusted R Square Standard Error Observations ANOVA df Regression Residual Total Coefficients Intercept MEDAGE2006 MEDINC2005 SS MS F 2 8.97E+12 4.49E+12 7.673711 71 4.15E+13 5.85E+11 73 5.05E+13 Significance F 0.00096999

0.421592655 0.177740367 0.152074738 764666.5725 73

Standard Error t Stat P-value 0 #N/A #N/A #N/A -10998.68797 11507.34 -0.9558 0.342417 29.74281717 17.83765 1.667418 0.099837

Lower 95% #N/A -33943.66437 -5.82444901

Upper 95% #N/A 11946.28843 65.31008336

Lower 95.0% #N/A -33943.66437 -5.82444901

Upper 95.0% #N/A 11946.28843 65.31008336

ii)

The overall accuracy of the model is tested by R Square and the Adjusted R Square. The R Square measures the proportion of the variation in the dependent variable that was explained by variations in the independent variables. The number will be between 0 and 1 with an ideal higher value. The Adjusted R Square measures the proportion of the variance in the dependent variable that was explained by variations in the independent variables. The number will be below 1 with an ideal higher value. The Adjusted R Square is more often referred to because when a new variable is
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added to the model, the Adjusted R Square increases only when the new variable makes the regression equation more accurate. R Square always goes up when a new variable is added, whether or not the new input variable improves the regression equations accuracy.
SUMMARY OUTPUT Regression Statistics Multiple R R Square Adjusted R Square Standard Error Observations ANOVA df Regression Residual Total Coefficients Intercept MEDAGE2006 MEDINC2005 SS MS F 2 8.97E+12 4.49E+12 7.673711 71 4.15E+13 5.85E+11 73 5.05E+13 Significance F 0.00096999

0.421592655 0.177740367 0.152074738 764666.5725 73

Standard Error t Stat P-value 0 #N/A #N/A #N/A -10998.68797 11507.34 -0.9558 0.342417 29.74281717 17.83765 1.667418 0.099837

Lower 95% #N/A -33943.66437 -5.82444901

Upper 95% #N/A 11946.28843 65.31008336

Lower 95.0% #N/A -33943.66437 -5.82444901

Upper 95.0% #N/A 11946.28843 65.31008336

iii)

The P-value provides the accuracy of the individual variables. When tested with 95% confidence, the P-value should also be below 0.05 to be considered statistically significant.

Regression Statistics Multiple R R Square Adjusted R Square Standard Error Observations ANOVA

0.421592655 0.177740367 0.152074738 764666.5725 73

df Regression Residual Total Coefficients Intercept MEDAGE2006 MEDINC2005

SS MS F 2 8.97E+12 4.49E+12 7.673711 71 4.15E+13 5.85E+11 73 5.05E+13

Significance F 0.00096999

Standard Error t Stat P-value 0 #N/A #N/A #N/A -10998.68797 11507.34 -0.9558 0.342417 29.74281717 17.83765 1.667418 0.099837

Lower 95% #N/A -33943.66437 -5.82444901

Upper 95% #N/A 11946.28843 65.31008336

Lower 95.0% #N/A -33943.66437 -5.82444901

Upper 95.0% #N/A 11946.28843 65.31008336

iv)

The Residuals are the difference between the models predicted value and the actual value of the output variable. They can be visualized for the identification of patterns on a scatterplot chart. The more random (without patterns) and centered around zero the residuals appear to be, the more likely the model is valid.
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3.

Lehrer (2011) observes five principle assumptions for using the regression model. They are: a) Linearity of the relationship between dependent and independent variables; b) Independence of the errors (no serial correlation); c) Homoscedasticity (constant variance) of the errors; d) Normality of the error distribution (no autocorrelation); and e) Independent variation in each regressor (no multicollinearity). Nau (2012) observes that if any of these violations are breached, then the forecasts, confidence intervals, and economic insights yielded by a regression model may be (at best) inefficient or (at worst) seriously biased or misleading. Each of the above is discussed in the results section where they can be detec ted and attempted to be fixed in relation to each model.

Discussion of Results
The results of the pre-regression testing of the correlation of POPCHG2001-2006 with the initial socio-economic variables in order to detect initial multicollinearity are seen in Figure 2.

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Figure 2: Correlation results with POP (2006) and other variables

POPCHG2001-2006

TOTPRVDWEL

MEDAGE

VALOWNDDWEL MEDINC GOVTRANS

MEDRENT MEDOWN IMM EMPRATE EDU

MANUFOCCU

ARTSOCCU

TRADESOCCU

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1 -0.715105237 -0.822208228 -0.324644043 -0.904030372 -0.319012599 -0.212123963 0.01708838 -0.158320865 1 0.875102592 0.360943319 0.599358664 0.232276465 0.172127579 0.057290845 0.22392338 1 0.409546 0.713735 0.319393 0.126818 0.078677 0.125868

POPCHG2001-2006 TOTPRVDWEL MEDAGE VALOWNDDWEL MEDINC GOVTRANS MEDRENT MEDOWN IMM EMPRATE EDU MANUFOCCU ARTSOCCU TRADESOCCU 1 -0.18870286 0.093489625 0.123936318 -0.294081428 0.220700556 0.357208009 0.441608456 0.146226858 0.736208308 -0.037215375 0.082706539 -0.068596717 1 -0.099505 -0.6846035 0.81312474 -0.5475202 -0.7264923 -0.3718753 -0.8689332 -0.1535593 -0.1653474 0.14174551 -0.1102417 1 0.318530429 -0.32924291 0.514935736 0.389907174 0.28800768 0.322334306 0.047054249 0.131036661 0.021202765 0.643862172 1 -0.85718 0.780486 0.800717 0.264956 0.77527 0.111005 0.145126 0.125224 0.051507 1 0.375957 0.332838 0.094751 0.097559 0.055688

1 -0.018329405 -0.383935572 0.381477126 0.276024424 -0.322965238 0.280827152 0.331723896 0.121171057 0.463552884 -0.094689974 -0.094447975 -0.002305306 0.236132177

1 0.099064 1 0.205931 0.145881 -0.03197 0.022231 0.238918 -0.15566

1 -0.293329817 1 0.181824442 -0.252195379

One of the key observations of the correlation test is that the majority of independent variables either showed no to moderate relationship. This is fine for socio-economic variables. If, for example, births or migration rate were being correlated with pop ulation, there would be a very high correlation however this would increase the chances of multicollinearity. With socioeconomic variables, it is hypothesized that they have some low to moderate impact which means they will display less correlation but also less multicollinearity; this is ideal for determining the model and will ideally make the coefficients more accurate. Seven of the thirteen variables showed positive movement with POPCHG2001-2006. They are VALOWNDDWEL, MEDINC, MEDRENT, MEDOWN, IMM, EMPRATE, and TRADESOCCU. This suggests that as population increases, so does the value of owned dwellings, the median income, the median rent or monthly payments for owned dwellings, the percent of the population who are immigrants, the employment rate, and the numbers of occupations in the Trades sector. Five of the variables showed negative movement. They are TOTPRIVDWEL, GOVTRANS, EDU, MANUFOCCU, and ARTSOCCU. This suggests that as population increases, there is a small decrease in total private dwellings, government transfers as a percent of income, the amount of those who hold post-secondary education, and those employed in the manufacturing and arts sectors. The results of the second pre-regression VIF test are seen in Figure 3. Although all of the independent variables are correlated with POPCHG2001-2006, the results of the VIF show that there is a high degree of multicollinearity present in half of the variables. As such, the following variables were removed: MEDAGE, MEDINC, GOVTRANS, MEDRENT, MEDOWN, and EMPRATE. It is disappointing to have to remove what were initially hypothesized to be

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Figure 3: VIF results with POP (2006) and other variables

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POPCHG2001-2006 TOTPRVDWEL MEDAGE VALOWNDDWEL -0.88414857 0.044238435 0.39119446 1.778257405 POPCHG2001-2006 0.16023873 2.769902299 -0.3867914 0.044238435 TOTPRVDWEL -2.301359456 -0.386791385 7.47898053 0.391194463 MEDAGE 3.560967744 0.16023873 -2.3013595 -0.88414857 VALOWNDDWEL -0.306090726 0.159251818 -0.0864676 0.340189141 MEDINC 0.714200168 0.244567065 0.0876969 -1.396992545 GOVTRANS -0.780841199 0.747795596 -0.940427 0.047194238 MEDRENT -0.490408943 -1.181441836 3.48145743 -0.414601721 MEDOWN -0.782257569 -0.641454822 0.72187938 0.405426323 IMM -0.297066658 0.072969758 4.9299528 -1.758063237 EMPRATE -0.113703717 -1.73770031 0.13139374 -0.08429121 EDU -0.062205748 0.424328821 -0.1912604 0.343065115 MANUFOCCU -0.076245503 0.005192127 -1.0202802 0.066728911 ARTSOCCU -1.872376019 -0.282515999 0.55792612 0.337235572 TRADESOCCU

MEDINC 0.340189141 0.159251818 -0.086467599 -0.306090726 7.121478654 4.974630591 -2.503066418 -0.09055781 0.155128915 -0.120345516 1.498753651 -0.075711763 -0.584030337 1.230698493

GOVTRANS -1.396992545 0.244567065 0.087696896 0.714200168 4.974630591 17.70127218 -0.565261458 2.977999287 -2.010919562 11.25501617 3.568627068 -0.335607381 -0.791533552 0.034296889

MEDRENT MEDOWN 0.047194238 -0.4146 0.747795596 -1.18144 -0.940427037 3.481457 -0.780841199 -0.49041 -2.503066418 -0.09056 -0.565261458 2.977999 6.637417573 -5.0922 -5.092200178 9.316473 -0.407315199 -0.031 0.742754717 2.551922 -0.47361007 0.38974 -0.130154438 0.041616 0.345257471 -0.66888 -0.484420027 0.43661

IMM EMPRATE 0.405426 -1.75806 -0.64145 0.07297 0.721879 4.929953 -0.78226 -0.29707 0.155129 -0.12035 -2.01092 11.25502 -0.40732 0.742755 -0.031 2.551922 1.912467 -1.67549 -1.67549 14.89429 -0.28812 2.258098 -0.05038 -0.73089 -0.12913 -0.94051 0.437808 -0.76256

EDU MANUFOCCU 0.343065115 -0.08429 0.424328821 -1.7377 0.131394 -0.191260374 -0.1137 -0.062205748 1.498754 -0.075711763 3.568627 -0.335607381 -0.47361 -0.130154438 0.041616324 0.38974 -0.28812 -0.050375388 2.258098 -0.730885564 3.296976 -0.520446483 1.342389356 -0.52045 0.37214399 -0.10124 0.592019 -0.112070762

ARTSOCCU TRADESOCCU 0.066728911 0.337235572 0.005192127 -0.282515999 -1.020280214 0.557926116 -0.076245503 -1.872376019 -0.584030337 1.230698493 -0.791533552 0.034296889 0.345257471 -0.484420027 -0.668876237 0.436610144 -0.129132672 0.437808256 -0.940514872 -0.762557013 -0.101242637 0.592019157 0.37214399 -0.112070762 1.446718631 0.346187116 0.346187116 2.521248193

influential variables in determining population change. However, as mentioned, very time consuming test regressions were run with both the population change from 2001-2006 and the absolute population as dependent variables, and including the now excluded variables. Each time, the models were strong in terms of their significance, however their skewed coefficients made it difficult to use the models to predict any reasonable population change. In an effort to achieve the best possible working model and identify accurate relationships between population growth and socio-economic variables, even if there are few final variables, those variables displaying multicollinearity have to be discarded. Thus, seven variables (TOTPRVDWEL, VALOWNDDWEL, IMM, EDU, MANUFOCCU, ARTSOCCU, and TRADESOCCU) were brought forth in constructing Model 1. The results of Model 1, observed in Figure 4, do not show a strong model. The Significance of F when tested at a 95% confidence level, at 0.059 is greater than 0.05, which signifies the regression as a whole has failed and the dependent variable, POPCHG2001-2006 cannot be explained by the independent variables. At this point, there is no need to proceed through the remaining steps. It is disappointing that Model 1 was not able to explain relationships with more variables however this is one of the challenges in determining alternate variables to predict growth. In an attempt to better the model, a series of stepwise regression models are performed. The Business School at California State University (2012) states that if the Significance of F is low, but one or more of the P-values are high, forward stepwise regression can be used to develop a better model that contains some of the variables. The results of the stepwise regression can be observed in Figure 5. As VALOWNDDWEL had the lowest P-value in Model 1, each of

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Figure 4: Regression Model 1

SUMMARY OUTPUT Regression Statistics Multiple R 0.427315 R Square 0.182598 Adjusted R Square 0.09457 Standard Error 0.087799 Observations 73 ANOVA df Regression Residual Total 7 65 72 SS MS F Significance F 0.111931641 0.01599 2.074319 0.058860285 0.501063422 0.007709 0.612995063 t Stat 0.188092 -0.01062 2.617812 0.485618 -0.66965 -1.21381 -0.56682 -0.28788 P-value 0.851391 0.991563 0.010997 0.628871 0.505453 0.229211 0.572789 0.774354 Lower 95% -0.07595585 -1.0976E-07 0.036546742 -2.44777915 -0.35943831 -3.81548961 -9.88989396 -2.93387309 Upper 95% 0.091750526 1.08596E-07 0.271739088 4.020613487 0.178923015 0.930802254 5.517134642 2.194619028 Lower 95.0% -0.075955849 -1.09757E-07 0.036546742 -2.447779148 -0.359438313 -3.815489608 -9.889893964 -2.933873091 Upper 95.0% 0.091750526 1.08596E-07 0.271739088 4.020613487 0.178923015 0.930802254 5.517134642 2.194619028

Intercept TOTPRVDWEL VALOWNDDWEL IMM EDU MANUFOCCU ARTSOCCU TRADESOCCU

Coefficients Standard Error 0.007897 0.041986679 -5.8E-10 5.46665E-08 0.154143 0.05888235 0.786417 1.619415634 -0.09026 0.134783214 -1.44234 1.188273452 -2.18638 3.857277134 -0.36963 1.28396045

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Figure 5: Results of Stepwise Regression Model 1 Model 1.1

Coefficients Standard Error t Stat Intercept 0.009698 0.024517 0.395565 VALOWNDDWEL 0.141791 0.040633 3.489549 TOTPRVDWEL -1.6E-08 3.35E-08 -0.4917 P-value Lower 95%Upper 95% Lower 95.0% Upper 95.0% 0.693629 -0.0392 0.058596 -0.0392 0.058596 0.000841 0.060751 0.222831 0.060751 0.222831 0.624473 -8.3E-08 5.04E-08 -8.3E-08 5.04E-08

Model 1.2
Coefficients Standard Error t Stat P-value Lower 95%Upper 95% Lower 95.0% Upper 95.0% Intercept 0.008409 0.024432 0.344167 0.731752 -0.04032 0.057137 -0.04032 0.057137 VALOWNDDWEL 0.138621 0.042314 3.27597 0.00164 0.054227 0.223014 0.054227 0.223014 IMM 0.151217 1.415402 0.106837 0.915224 -2.67171 2.974147 -2.67171 2.974147

Model 1.3
Coefficients Standard Error t Stat Intercept 0.027781 0.030674 0.905661 VALOWNDDWEL 0.141871 0.040267 3.523286 EDU -0.08623 0.08386 -1.02832 P-value Lower 95%Upper 95% Lower 95.0% Upper 95.0% 0.368222 -0.0334 0.088959 -0.0334 0.088959 0.000755 0.061562 0.222181 0.061562 0.222181 0.307338 -0.25349 0.081018 -0.25349 0.081018

Model 1.4
Coefficients Standard Error t Stat Intercept -0.00948 0.027614 -0.34344 VALOWNDDWEL 0.146986 0.040366 3.641304 MANUFOCCU -1.40726 1.053846 -1.33535 P-value Lower 95%Upper 95% Lower 95.0% Upper 95.0% 0.732295 -0.06456 0.045591 -0.06456 0.045591 0.000516 0.066478 0.227494 0.066478 0.227494 0.186087 -3.50909 0.694572 -3.50909 0.694572

Model 1.5
Coefficients Standard Error t Stat Intercept 0.008776 0.024658 0.35592 VALOWNDDWEL 0.140004 0.040531 3.454208 ARTSOCCU -0.32149 3.416472 -0.0941 P-value Lower 95%Upper 95% Lower 95.0% Upper 95.0% 0.722971 -0.0404 0.057954 -0.0404 0.057954 0.000941 0.059166 0.220841 0.059166 0.220841 0.925298 -7.13543 6.492446 -7.13543 6.492446

Model 1.6
Coefficients Standard Error t Stat Intercept 0.006971 0.027797 0.250799 VALOWNDDWEL 0.14375 0.052959 2.714356 TRADESOCCU -0.12747 1.135781 -0.11223 P-value Lower 95%Upper 95% Lower 95.0% Upper 95.0% 0.802704 -0.04847 0.062411 -0.04847 0.062411 0.008355 0.038126 0.249373 0.038126 0.249373 0.910963 -2.39271 2.137776 -2.39271 2.137776

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the six stepwise regression models contain POPCHG2001-2006 as the independent variable, VALOWNDDWEL as one of the dependent variables, and each of the remaining variables as a one dependent variable per model. The objective was to create a model that held both independent P-Values under 0.05. This was unachievable and did not create a reliable model. In a final attempt to create a viable model with POPCHG2001-2006, another series of step-wise regressions was performed. For this series, VALOWNDDWEL was removed from the calculations because it was not able to create a working model with the other dependent variables and POPCHG2001-2006. In order to determine which of the remaining six variables had the lowest P-value, regression Model 2 was completed. This is seen in Figure 6.

Figure 6: Regression Model 2

SUMMARY OUTPUT Regression Statistics Multiple R 0.310515 R Square 0.096419 Adjusted R Square 0.014276 Standard Error 0.091609 Observations 73 ANOVA df Regression Residual Total SS MS F Significance F 6 0.059105 0.009851 1.173789 0.331063 66 0.55389 0.008392 72 0.612995 P-value Lower 95%Upper 95% Lower 95.0% Upper 95.0% 0.078395 -0.00775 0.140416 -0.00775 0.140416 0.898069 -1.2E-07 1.06E-07 -1.2E-07 1.06E-07 0.24894 -1.35898 5.152627 -1.35898 5.152627 0.703418 -0.33273 0.225772 -0.33273 0.225772 0.27592 -3.83627 1.112921 -3.83627 1.112921 0.965191 -7.64196 7.984832 -7.64196 7.984832 0.05764 -0.06356 3.874329 -0.06356 3.874329
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Coefficients Standard Error t Stat Intercept 0.066335 0.037104 1.787826 TOTPRVDWEL -7.3E-09 5.7E-08 -0.1286 IMM 1.896822 1.630704 1.163192 EDU -0.05348 0.139867 -0.38237 MANUFOCCU -1.36167 1.239426 -1.09863 ARTSOCCU 0.171434 3.913421 0.043807 TRADESOCCU 1.905384 0.986167 1.932112

The lowest P-value is TRADESOCCU. Therefore in completing the second stepwise regression model, POPCHG2001-2006 will be the dependent variable, TRADESOCCU is one of the dependent variables, and each of the remaining five will be the other dependent variables in individual models. The results of the stepwise regression can be observed in Figure 7 - Stepwise Regression 2.

Figure 7: Results of Stepwise Regression Model 2 Model 2.1

Coefficients Standard Error t Stat Intercept 0.07642 0.012602 6.064048 TRADESOCCU 1.856348 0.915778 2.027072 TOTPRVDWEL -6.5E-10 3.53E-08 -0.0184 P-value Lower 95%Upper 95% Lower 95.0% Upper 95.0% 6.04E-08 0.051286 0.101555 0.051286 0.101555 0.046465 0.029886 3.68281 0.029886 3.68281 0.985375 -7.1E-08 6.97E-08 -7.1E-08 6.97E-08

Model 2.2
Coefficients Standard Error t Stat Intercept 0.069821 0.013377 5.219412 TRADESOCCU 1.810036 0.909354 1.990464 IMM 1.329442 1.418306 0.937346 P-value Lower 95%Upper 95% Lower 95.0% Upper 95.0% 1.75E-06 0.043141 0.096501 0.043141 0.096501 0.050446 -0.00361 3.623686 -0.00361 3.623686 0.351804 -1.49928 4.158164 -1.49928 4.158164

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Model 2.3
Coefficients Standard Error t Stat Intercept 0.087398 0.024717 3.535975 TRADESOCCU 1.784805 0.92321 1.933259 EDU -0.04535 0.08965 -0.5059 P-value Lower 95%Upper 95% Lower 95.0% Upper 95.0% 0.000725 0.038102 0.136693 0.038102 0.136693 0.057249 -0.05648 3.626089 -0.05648 3.626089 0.614516 -0.22416 0.133448 -0.22416 0.133448

Model 2.4
Coefficients Standard Error t Stat P-value Lower 95%Upper 95% Lower 95.0% Upper 95.0% Intercept 0.06175 0.016537 3.734064 0.00038 0.028768 0.094732 0.028768 0.094732 TRADESOCCU 2.06072 0.919457 2.241236 0.028184 0.226921 3.89452 0.226921 3.89452 MANUFOCCU -1.36054 1.119269 -1.21556 0.228238 -3.59285 0.871777 -3.59285 0.871777

Model 2.5
Coefficients Standard Error t Stat Intercept 0.073627 0.012646 5.822272 TRADESOCCU 1.978786 0.94239 2.099753 ARTSOCCU 1.890136 3.703933 0.510305 P-value Lower 95%Upper 95% Lower 95.0% Upper 95.0% 1.61E-07 0.048406 0.098848 0.048406 0.098848 0.039357 0.099249 3.858324 0.099249 3.858324 0.611443 -5.49713 9.277397 -5.49713 9.277397

The objective was to create a model that held both independent P-Values under 0.05. Although the Adjusted R Square is low for each of the models, which is quite reasonable to believe remembering that the key determinants of growth have been omitted, overall the Significance of F is greater than 0.05, as are the P-values. Therefore the second stepwise regression did not create a reliable model. This leads me to conclude that given the parameters used to identify a model in this particular study, an accurate and reliable multiple regression model to determine some of the socio-economic variables of growth is not achievable for a number of reasons. The first is that even though it appears from the models that the socio-economic variables do not exert a strong relationship to population growth, they are probably more complex and interrelated than may initially be seen by regression models. As such, no one statistical procedure

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will satisfy a perfect measurement method. This is exemplified in the studies that we examined in the literature review. Many of these used multiple analysis methods, including spatial and temporal data. The now defunct U.S. Department of Health, Education, and Welfare (1969) states that population measurement requirements must satisfy the following broad requirements: 1. Data content requirements; 2. Population content requirements; 3. Geographic area requirements; and 4. Time requirements. The Department calls all of these requirements and their interrelatedness a matrix, which partially defines the desired measurement tools. Indeed, this also calls for the requirement of a strong statistical analysis system which can better disseminate the information. Another factor in why a model was difficult to obtain is perhaps due to the sample size. Although 73 municipalities should have been large enough to provide a decent sample size, perhaps the data would be better tested using census tract information for each of the municipalities. This would likely provide hundreds, if not tho usands, of samples. Unfortunately, simply using the parameters of cities above 40,000 does not provide as large of a sample size as it would in say, the United States. Unfortunately, one cannot fully determine the variables of growth in Canadian cities by using more populous countries data. A third factor might have to due with the geographic area selected. Although it is hypothesized that the socio-economic factors that affect growth would be constant across the nation, perhaps the analysis should start with a smaller geographic catchment (such as those by Chi and Voss (2011) who used census tract information in Wisconsin, or Golant and Bourne (1968), who used municipalities in Ontario and Quebec). Perhaps an analysis of growth should start at a smaller, regional or municipal level, and once it is viable there, can be expanded to a greater geographic area.

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However the main reason the model failed to predict multiple variables is that could not be found, despite multiple attempts, to satisfy a number of Lehrers (2011) assumptions. The violation of no multicollinearity was one of the key detriments. Despite two calculations, correlation and variance inflationary factors, to remove variables that contained multicollinearity, those variables displaying no multicollinearity that were brought forth in attempting a better model, could not be found to work together despite two stepwise regression processes. The main cause for this is likely due to omitted variable bias. Although it is impossible to include all relevant variables in a regression equation, which makes omitted variable bias unavoidable, it is likely that even when trying to determine the socio-economic determinants of growth, the key factors in growth (births/death, internal migration, and immigration) should attempted to be included in the model. The fact that they are not substantiates the belief that the other independent variables may increase the bias of the omitted variables as well as additional bias through measurement error (Clarke, 2005). Although there is a strong possibility that the inclusion of the formal determinants of growth in a model could include correlation, multicollinearity, or endogeneity (changes in the dependent variable could cause changes in the independent variables), when controlled for, they are likely to produce a more non-biased model that would provide a better indication of the relationship with the socio-economic variables. Unfortunately, for the purpose of this assignment, data on births/deaths and rate of internal migration for the test municipalities is not readily accessible from Statistics Canada. However in completing a more thorough analysis, it is recommended that these variables be introduced in the model. Finally, the challenges in producing a viable population growth model that includes socio-economic data, especially in Canada, are likely one of the reasons it has not been

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attempted more often. Instead, descriptive statistics are more commonly analyzed. Perhaps t his is what Clarke refers to when he concludes that Narrow, focused, controlled tests of broad theories, while unlikely to be definitive, provide evidence that is far more convincing than a regression equation weighed down by half a dozen control variables, (p. 350). The next part of the assignment attempts to do this.

Singular Regression as Predictor

In order to create a working regression equation to forecast population change, as well as introduce some dummy variables, a simple linear, or bivariate, ordinary least squares regression model will be utilized. The independent variable will remain POPCHG2001-2006, and be tested in seven linear models, each incorporating one of the dependent variables (TOTPRVDWEL, VALOWNDDWEL, IMM, EDU, MANUFOCCU, ARTSOCCU, and TRADESOCCU) that passed the initial correlation and VIF tests (see Figure(s) 2 and 3). The results can be observed in Appendix D. Of the six linear models, only one, TRADESOCCU, proved a strong working model. This model was brought forth in order to show how regression models can be used to predict as well as interact with dummy/explanatory variables. The summary output can be seen in Figure 8. There is a positive relationship between an increase in population and the percentage of occupations that are in the Trades sector. The model shows that for every one percent in population growth, the percent in trades occupations will increase by 185%. Overall, the Significance of F, at .044 is less than 0.05, and shows that the model as a whole is very significant and not obtained by chance. The R Square and Adjusted R Square, at .055 and .042, shows that occupations in the Trades sector account for 4.2% of growth. This number is still

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Figure 8: Linear Regression Model POPCHG2001-2006 and TRADESOCCU

SUMMARY OUTPUT Regression Statistics Multiple R 0.236132 R Square 0.055758 Adjusted R Square 0.042459 Standard Error 0.09029 Observations 73 ANOVA df Regression Residual Total SS MS F Significance F 1 0.03418 0.03418 4.192621 0.044301045 71 0.578815 0.008152 72 0.612995 Lower 95% Upper 95% Lower 95.0% Upper 95.0% 0.053541974 0.09911 0.053542 0.09911 0.048665513 3.666342 0.048666 3.666342

Intercept TRADESOCCU

Coefficients Standard Error t Stat P-value 0.076326 0.011427 6.679714 4.52E-09 1.857504 0.907166 2.047589 0.044301

relatively high for one occupation category and likely, if the natural determinants of growth were included, would likely be lower. On the other hand, as will be seen in the analysis of descriptive statistics, those municipalities in the West region have seen strong growth in the Trades sector and it is known that people have migrated to these municipalities for employment in this sector. So this explanatory factor should be accounted for in analyzing the Adjusted R Square. The Pvalue for TRADESOCCU, at .044, is less than 0.05, which means that there is significant statistical evidence to suggest a positive relationship of TRADESOCCU as a predicator of
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POPCHG2001-2006. Finally, the Residual Plots are distributed randomly and centered around the 0 which also suggests the model is valid. In testing the model against violations of Lehrers (2012) assumptions, it stil l proves satisfactory. Assumption #1 is the linearity of the relationship between dependent and independent variables. This was satisfied by the Residual Plots which shows that points are symmetrically distributed around 0 in a horizontal line. Assumption #2 is independence of the errors or no serial correlation. This was satisfied, along with Assumption #5, which is no multicollinearity and Assumption #4, no autocorrelation, in the initial correlation chart which can be see in Figure(s) 2 and 3, which were the initial tests for correlation and multicollinearity. Lastly is Assumption #3, which is the influence of homoscadasticity. This can be tested for by observing the Residual Plots and ensuring that that are not getting larger either as a function of time or as a function of the predicted value. This does not appear to be happening especially since this model was cross-sectional as opposed to cross-time. The equation for this model is: POPCHG2001-2006 = .076 + 1.858 (TRADESOCCU). In order to show how this model can be used to predict population growth dependent on growth in trades occupations, the following example is given using the CMA of AbbotsfordMission, British Columbia. From 2001-2006, the amount of occupations in the trades sector increased 2.7%. This is likely because of a stronger manufacturing sector and increasing warehousing activity in the region (City of Abbotsford, 2009). Population between this time period also grew substantially by 7.9%. For example, lets say the municipality, perhaps taking advantage of clustering, was successfully able to attract new manufacturing or research and development businesses. These organizations would require skilled tradesmen and thus, expected

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trades positions to increase by 3.4 percent. The calculation in Figure 9, shows how linear regression can be used to predict population growth based on the amount of anticipated jobs in the trades sector. Figure 9: Linear regression to pre dict - POPCHG2001-2006 and TRADESOCCU POPCHG2001-2006 = .076 + 1.858 (TRADESOCCU). =.076 + 1.858(.034) =.076 + 0.063 = 0.139 (Predicted Value)

POPCHG2001-2006 = .076 + 1.858(.027) =.076 + 0.05 =0.038 (Actual Value) POPCHG2001-2006 = Predicted Value Actual Value = 0.139 - .038 = 0.101

If the amount of trades positions increase by 3.4 percent, population will increase by approximately 10.1%. Of course, this is looking solely at the relationship between population change and trades occupations. Because many other factors are included in population growth, in order for the model to forecast better, it has to include these other variables while still proving to be a reliable model. As the previous multiple regression exercise provided, this can be a hard thing to do.

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Hypothetically speaking, lets pretend the multiple regression Model 2 was a stronger model, and we can use multiple variables (TOTPRVDWEL, VALOWNDDWEL, IMM, EDU, MANUFOCCU, ARTSOCCU, and TRADESOCCU) in order to predict the population of Abbotsford-Mission. Table 2 represents those values from the 2006 Census as well as values that have been hypothetically forecasted by planners. Table 2 2006 census and predicted values for Abbotsford-Mission

Variable TOTPRVDWEL IMM EDU MANUFOCCU ARTSOCCU TRADESOCCU

2006 census value 58,099 .233 .174 -.004 -.002 .027

Predicted value 63,000 .3 .2 .02 0.01 .034

The calculation in Figure 10, shows how regression can be used to predict population growth with multiple variables.

Figure 10: Multiple regression to predict - POPCHG2001-2006 and Model 2 variables POPCHG2001-2006 = 0.066 + 0.000 (TOTPRVDWEL) + 1.897 (IMM) - .053 (EDU) 1.362 (MANUFOCCU) + 0.171 (ARTSOCCU) + 1.905 (TRADESOCCU) = .066 + 0.000(63,000) + 1.897(.3) - .053(.2) -1.362(.02) + .171(0.01) + 1.905(.034) = .066 + 0 + .0.569 0.011 0.027 + .002 + .065 = .664 (Predicted) POPCHG2001-2006 = 0.066 + 0.000 (58,099) + 1.897 (.233) - .053 (.174) 1.362 (-.004) + 0.171 (-.002) + 1.905 (.027) =.066 + 0 + .442 -.009 + 0.005 0 + .051

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= 0.555 (Actual) POPCHG2001-2006 = Predicted Value Actual Value = .664 - .555 = .109

Given the predicted values, the population in Abbotsford-Mission will increase approximately 10.9%. These two examples exemplify how regression, when the model is strong, can be used to forecast population growth. Returning to linear regression, binary, or dummy, variables can also be used to determine trends, especially those related to geography. The first example, Figure 11, will test to see what the effect is on population growth of TRADESOCCU and the municipality being geographically located in the West, REGWEST. If the municipality was located in the West, it was given the value of 1. If it was located in the other regions, it was given the value of 0. For every percent increase in population growth, the percentage of jobs in the trades sector will increase by 146%. If the municipality is located in the West, this growth increases by 1.4%. However it should be noted that the high Significance of F and P-values negate the strength of the model for the same reasons discussed previously. The second example will use the same variables but test to see what the effect is if the municipality is located in Quebec. If the municipality was located in Quebec, it was given the value of 1. If it was located in the other regions, it was given the value of 0. The results are seen in Figure 12.

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Figure 11: Regression Model with Regional Dummy Variable for the West
SUMMARY OUTPUT Regression Statistics Multiple R 0.242018 R Square 0.058573 Adjusted R Square 0.031675 Standard Error 0.090797 Observations 73 ANOVA df Regression Residual Total 2 70 72 SS MS F Significance F 0.03590476 0.017952 2.177591 0.120931 0.577090302 0.008244 0.612995063

Coefficients Standard Error t Stat P-value Lower 95%Upper 95% Lower 95.0% Upper 95.0% Intercept 0.073532 0.013012819 5.650741 3.2E-07 0.047579 0.099485 0.047579 0.099485 TRADESOCCU 1.460608 1.25897341 1.160158 0.249926 -1.05034 3.971551 -1.05034 3.971551 LOCATWEST 0.014281 0.031219666 0.457445 0.648768 -0.04798 0.076547 -0.04798 0.076547

Figure 12: Regression Model with Regional Dummy Variable for Quebec
SUMMARY OUTPUT Regression Statistics Multiple R 0.271015 R Square 0.073449 Adjusted R Square 0.046976 Standard Error 0.090077 Observations 73 ANOVA df Regression Residual Total SS MS F Significance F 2 0.045024 0.022512 2.774502 0.069250891 70 0.567971 0.008114 72 0.612995 Lower 95% Upper 95% Lower 95.0% Upper 95.0% 0.042759268 0.094993 0.042759 0.094993 0.210179923 3.8768 0.21018 3.8768 -0.021700238 0.081548 -0.0217 0.081548

Coefficients Standard Error t Stat P-value Intercept 0.068876 0.013095 5.259797 1.5E-06 TRADESOCCU 2.04349 0.919212 2.223089 0.02944 LOCATQUE 0.029924 0.025884 1.156076 0.251581

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For every percent increase in population growth, the percentage of jobs in the trades sector will increase by 204%. If the municipality is located in the Quebec, this growth increases by 2.9%. However it should be noted that the high Significance of F and P-values for the categorical variables LOCATQUE negate the strength of the model for the same reasons discussed previously.

Socio-Economic Variables as Growth Determinants: A Descriptive Statistics Analysis

It is disappointing that due to the complexities involved in examining the socio-economic factors of population growth, that a stronger regression model could not be produced. We do know that socio-economic factors determine growth. Both the initial litera ture review pointed this out in a number of key studies as well as a common-sense understanding of general migration patterns. Take three simple, albeit subjective, examples. First, people continue to migrate to the west because of better employment prospects. Second, immigrants are more likely to follow previous transnational networks and increasingly, temporary foreign worker programs, and settle in municipalities where they have a community. Third, there is downward trend in the percent of manufacturing jobs as a total of all jobs across North America, which will cause people, especially youth, to leave in search of employment. Both the second and third examples are directly connected to the first. The newly immigrated Pilipino and the 23 year-old from Sydney, Nova Scotia will both end up in Saskatchewan because of the availability of employment. This will likely drive the median house prices up which could force an elderly couple to retire outside of the municipality, perhaps to a cottage or rural property. This is a very crude example but what it shows is the horizontal interconnectedness of growth determinants and why it is challenging to include them in growth models. As such, these determinants, and subsequent trends, are typically examined by planne rs and policy- makers using descriptive
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statistics. This assignment will now look at various socio-economic determinants, and their policy implications, in order to show that there is a relationship with population growth. There are three broad growth trends occurring in Canadian municipalities. The first is the growing population and economic growth of western Canadian municipalities. Although only examining 13 of the largest municipalities, The Conference Board of Canada (2012) predicts the top 5 municipalities for GDP growth between 2013-2016 to be Calgary, Edmonton, Saskatoon, Vancouver, and Regina; each with growth over 3 per cent a year. If the Conference Board of Canadas (2006) report on hub cities is accurate, the smaller Western Canadian municipalities that are well connected to the larger, regional centres, will also stand to benefit and grow through the Conference Boards theory of convergence. The second is the concept of slow growth and decline in Canadian cities, with a strong concentration of those in Northern Ontario, Quebec, and the Maritimes. There are a number of factors exacerbating this trend including the uneven distribution of domestic and international migrants, who tend to concentrate in larger city-regions (Bourne & Simmons, 2003), economic restructuring and technological change that have led to a decline in the resource and manufacturing sectors while knowledge- intensive industries are being concentrated in the larger municipalities (Gertler, 2001), and other factors relating to national and provincial policies and geography (Donald & Hall, 2010). This was further echoed in a report by the Eastern Ontario Wardens Caucus (2012) which examined the economic conditions of 114 urban and rural local governments in Eastern Ontario. The report found that there were numerous factors affecting the municipalities sustainability including a limited tax base to pay for services and maintain existing infrastructure, rising debt levels, and growing and critical need to maintain existing infrastructure and meet future needs. The report found the unsettling figure that

35

municipal debt levels in Eastern Ontario have increased about 300 per cent over the past decade and municipalities need to find an additional $500 to $600 million per year to maintain existing capital assets, including roads and bridges. These issues and numbers also resonate through other municipalities in Eastern Canada. The third, briefly covered in the introduction, is the concentration of growth within the six largest CMAs in Canada (Toronto, Montreal, Vancouver, Ottawa-Gatineau, Calgary and Edmonton), which account for 45% of Canadas population, and which between 2001-2006, grew at a rate of 8%, double the rate for other CMAs (Statistics Canada, 2008). They are also increasingly taking up a larger share of the provincial GDP. For example, Edmonton and Calgary account for 64.8% of the provincial GDP (Conference Board of Canada, 2006). All of these trends have occurred as regional growth has become more emphasized in an attempt to promote human settlement that is socially, economically and environmentally healthy and that makes efficient use of public facilities, land and other resources (Government of British Columbia, 2012). Courchene (2012a) rightly concludes however that Canadian Global City Regions appear to be performing well beneath their potential; both fiscally weak in international comparisons and constitutionally jurisdictionless in the Canadian context. If this is the case in our largest, arguably most successful regions, what about those regions in decline, that may not be able to compete? This assignment now seeks to examine some of the socio-economic variables leading to population growth, or decline, in attempt to paint a statistical picture of the three broad urban trends. The variables being discussed are government transfers as a percent of total income, median income, average value of owned dwelling, employment rate, and occupations. Both the

36

type of municipality (1st , 2nd, or 3rd tier) and the region, will also be considered. First however, general population trends, will be briefly discussed. In their study on growth and change in 144 Canadian urban systems, Bourne et al. identified the Top 10 winners and losers based on growth rate, natural increase, net domestic migration, and net immigration from 2001-2006. Their results are interpreted in Table 3. The cities have been color-coded per region by myself to better visualize the data. The West is blue, Ontario is red, Quebec is green, and the Maritimes are orange. Table 3: Demographic Winners and Losers, 2001-2006

Cities 1. Okotoks 2. Wood Buffalo 3. Grande Prairie 4. Red Deer 5. Barrie 6. Calgary 7. Yellowknife 8. Lloydminster 9. Oshawa 10. Canmore 135. Bathurst 136. Elliot Lake 137. Kenora 138. North Battleford 139. Campbellton 140. Williams Lake 141. Terrace 142. Quesnel 143. Prince Rupert 144. Kitimat

Growth Rate 46.7 23.6 22.3 22 19.3 13.4 13.1 12.8 11.6 11.6 -3.4 -3.4 -4.2 -4.4 -5 -5.1 -7 -8.1 -12.5 -12.6

Natural Increase Okotoks Grande Prairie Red Deer Wood Buffalo Lloydminster Yellowknife Lethbridge Camrose Rivire-de-Loup Medicine Hat Edmundston Campbellton Kitimat Quesnel Port Alberni Port Hope Parksville Williams Lake Prince Rupert Elliott Lake

Net Domestic Migration Okotoks Parksville Barrie Chilliwack Port Hope Oshawa Collingwood Kelowna Kawartha Lakes Courtenay Elliot Lake Rouyn Terrace Yellowknife Gander Thompson Baie-Comeau Kitimat Labrador City Prince Rupert

Net Immigration Toronto Vancouver Calgary Montreal Brooks Wood Buffalo Windsor Kitchener Squamish Abbotsford Valleyfield Cowansville Amos Port Alberni Elliott Lake Temiskaming La Tuque Kenora Shawinigan Bay Roberts

With the exception of net immigration, almost all of the municipalities in the study are smaller centres, which the authors find tend to be more susceptible to rapid change. In fact, the majority of them have populations under 40,000 which omitted them from the initial regression tests. What the majority of winners and losers both have in common is their dependence on
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natural resources or commodities. How well they perform demographically likely tends to correlate with how well that commodity is doing on world markets. For example, Wood Buffalo, Grande Prairie, and Red Deer all centres for oil distribution; a commodity that is seeing strong and continued growth. The bottom five municipalities are all located in the northern interior of British Columbia. They have typically been dependent on the forestry industry as their key employers. However the forestry industry in Canada has fallen on difficult times due to disinvestment, scarce supplies of wood, and international competition (Government of Canada, 1992). The other characteristic exemplified by the winne rs is that they are, or are located to, regional hubs, or 1st and 2nd tier centres. Key urban policy thinkers such as Robert Park, Jane Jacobs, Wilbur Thompson, and more recently Richard Florida, have all advocated for strong regions not the least because of efficiency tied to concentrated government support for economic development and infrastructure, the clustering of like- minded business, integrated

transportation networks, and the ability to grow population density. Cohesive and well-planned interconnectedness in a particular region only strengthen that regions ability to perform and compete both domestically and internationally. Those municipalities that are currently failing in Canada are often in remote, economically-depressed locations that have been dependent on a single-commodity. Without government intervention and reinvestment, they risk falling into the same depression and decline as the American Rust Belt. Unfortunately their situation is worsened by their physical location, lack of efficient transportation networks, ability to evolve out of the manufacturing sector to skilled or service-based labour, and general inability to integrate themselves with the provincial economy.

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This assignment will now turn to an analysis of some of the soc io-economic determinants of growth. a) Government transfers as a % of total income Median government transfers among families were $4,800 in 2008 (Government of Canada, 2010b). Government transfers cover a range of programs, including Employment Insurance, the Canada Pension Plan and Quebec Pension Plan, Old Age Security, Guaranteed Income Supplement, and child tax benefits. Figure 13 displays the trends of government transfers as a percent of total income for both the type of city and region, between 1995-2005. Although government transfers in themselves are likely not an indicator of population change (people are not going to move to Cape Breton simply because approximately 25% of Cape Bretoners income is received via transfers), they do provide insight into the aging demographic as well as overall economic vitality of a region. From a policy perspective, interregional income disparities are good indicators of the magnitude of differences in standards of living between regions as well as the effectiveness of tax and transfer policies aimed at reducing income disparities among the various regions of the country (Government of British Columbia, 2011). Overall, government transfers as a percent of total income are in decline, with the exception of Quebecs municipalities, across the country. Looking first at the type of municipality, 3rd-tier municipal residents are more likely to have a portion of their income subsidized by the government. The more diversified and populated a municipality is, the less reliance it will have on transfer payments. This is further exemplified in the demographic losers table, which consists solely of 3rd-tier, and could arguably qualify as a 4 th-tier, municipalities. The majority of the loser municipalities are, or have, experienced dire economic straits, and so

39

Figure 13: Governme nt Transfers a Percent of Total Income

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the remaining population, especially those participating in the workforce, are likely socially subsidized. From a regional perspective, government transfers continue to be the highest in the Maritimes and Quebec. Although the Maritimes have long been the recipients of Employment Insurance transfers, due to seasonal economies and the fickle nature of their resources, they will likely soon be the recipients of increasing pension transfers due to having the highest median ages in the country. (Statistics Canada, 2012) Figure 14 shows the difference in median age from 1982-2012. Figure 14: Median age, 1982 and 2012, Canada, provinces and te rritories

Transfer payments to the West would likely be a lot lower if British Columbia were excluded. The higher median age as well as depressed economies in the northern part of the province, keep this number high. Of the 73 municipalities researched, the top five for receiving less government transfers are in Alberta (Wood Buffalo 2.5%, Calgary 5.3%, Grande Prairie 5.4%, Red Deer 7.2%, and Edmonton 7.9%). On the contrary, of the ten most dependent
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municipalities, six are in Quebec (Drummondville, Rouyn-Noranda, Trois-Rivires, Sorel- Tracy, Joliette, and Shawinigan), two in the Maritimes (Truro and Cape Breton), one in British Columbia (Penticton) and one in Ontario (Cornwall). b) Median Income The analysis of government transfers and now, median income, shows that Canada is becoming increasingly polarized through income distribution. Walks (2010) observes that strikingly different resource bases coupled with uneven development has produced increasing diverging average incomes among Canadas CMAs. This in increasingly being analyzed at the local level through studies like Hulchanskis (2010) The Three Cities Within Toronto and Ley and Lynchs (2012) Divisions and Disparities in Lotus-Land: Social-Spatial Income Polarization in Greater Vancouver, 1975-2005. Figure 15 displays the trends of median income for both the type of city and region, between 1995-2005. Figure 15 Median Income

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Percent Change
1995-2000 2000-2005 1st Tier 0.18 0.14 2nd Tier 0.17 0.17 3rd Tier 0.16 0.20

Percentage change
1995-2000 2000-2005 0.16 0.21 0.16 0.16 0.19 0.19 0.18 0.19

West Ont. Que. Mar.

From 1995-2005, absolute income in all Canadian municipalities has increased. The strongest income gains are taking place in 3 rd-tier cities, which saw a .04 percentage points
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increase from 2000-2005 (contrasting 1st -tier cities which saw a .04 percentage points decline during the same time period. However it is important to correlate income with government transfers (and also the employment rate). Remember that 3 rd-tier municipalities are also the greatest recipients of government transfers which means that although median income is increasing, it might not be because of more employment opportunities or better paying jobs. The highest income gains are taking place in the West with a .05 percentage point increase between 2000-2001. There has been no change in Ontario and Quebec and a slight increase in the Maritimes. Walks (2010) views increasing social polarization as spurning a series of selfreinforcing feedback loops, in which the responses of individuals feed into the system to further aggravate the problems caused by polarization, (p.186). He further provides an example that as they become wealthier, rich households attain more power to influence the political processes to push for policy reforms in their favour, such as tax and public-spending cuts, which further drive the inequality facilitating the transfer of power to the wealthy. Municipalities can be thought of in the same sense and we are seeing this occur in Canadian politics at the moment with the ascension of the West. In both of the variables analyzed thus far, less dependence on the government for transfers and increasing incomes, provide Western municipalities with increasing clout in distinguishing themselves as strong and competitive city-regions. Although we have seen examples of struggling municipalities in the West, the overall vitality of the region may be enough to offset slower development and standard of living. However in those regions such as Quebec and the Maritimes, where government transfers remain high and overall income gain is stabilizing, the challenge will be to tie any resource/commodity benefits to producing greater

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overall equality with less dependence on the government, and channeling growth to the municipalities/regions to allow them to compete both domestically and globally. c) Average value of owned dwelling One of the impacts of population growth has been the drastic increase in the value of real estate in Canadian municipalities; especially those that are prospering. One of the reasons for higher prices is that single family homes on individual lots consume the greatest amount of residential land and continue to lead the housing inventory (Walker & Carter, 2010). As municipalities increase in population, so does the population of higher density, and sometimes less inexpensive, residential dwellings. Walker and Carter (2010) observe that in 2006, 55% of all residential dwellings in Canada were single detached units. This proportion fell to 47% in the larger cities but rose to 63% in smaller cities. There is also a difference between the core city centre, where density is likely to be higher, and the greater CMA, where housing is likely to be more residential in the form of suburbs. Figure 16 displays the average value of an owned dwelling between 1996-2006. Figure 16: Average value of an owne d dwelling between 1996-2006

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Percentage change
1996-2001 2001-2006 1st Tier 0.10 0.69 2nd Tier 0.07 0.53 3rd Tier 0.07 0.60

Percentage change
1996-2001 2001-2006 0.07 0.81 0.07 0.43 0.07 0.50 0.12 0.43

West Ont. Que. Mar.

The value of owned dwellings from 1996-2006 can be divided into two phases. The first, is a relatively normal increase in value between 7-10%. However from 2001-2006, the value of dwellings increased substantially. This was most pronounced in 1 st -tier municipalities, which saws a 69% increase in the value of housing, and in western Canada, where the value rose 81%. There was a strong increase in value in 3rd-tier municipalities, most notably in the west. Of the top 10 average values in this category, nine were in cities in Alberta and British Columbia. Given
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the continued increase in home values after 2006, as well as the stability of 1 st -tier municipalities and some of the 2nd and 3rd-tier ones in the west, it would be interested to see the change from 2006-2011 (This information has not yet been disseminated by Statistics Canada). The Bank of Canada argues that both income and population are important dete rminants of Canadian house prices over the longer term (Bank of Canada, 2011). Over shorter horizonsa decade or lesshouse prices may outpace population and income in some periods and lag behind them in others. The 1st -tier municipalities will especially be challenged to provide housing units that are suitable for all family-types, or risk losing population to the greater suburbs. Another challenge will be to provide affordable housing units that are integrated into the city, especially in terms of access to public transportation. There have been a number of articles on the Manhattanization of Toronto (Huffington Post, 2012; CBC, 2012) which threaten that as the supply of detached homes in Toronto dwindles over the coming years, the remaining ones will increase in price, making home ownership unachievable for the average family. Although condominium fees are expected to rise moderately or stay flat, the prices for single detached homes and townhomes are expected to go up 30 to 50 per cent by 2020. Much has also been written about increased demand and affordability across the western provinces; especially in the growing municipalities of Alberta and Saskatoon. Employment will continue to be one of the key draws to Canadian municipalities however this is strongly correlated to affordability. The winners will be those bedroom CMA communities who can provide affordable options and accessible connectivity to surrounding centres. As western cities grow, the challenge will be to embrace sustainable approaches to residential sub-division design that include mixed housing options. The losers will be those 1 st -tier cities who will let housing

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demand be decided exclusively by the private marketplace, and are unable to leverage their policies to make more inclusive and affordable cities. d) Employment rate & Occupational sector profiles Employment is one of the key variables in determining population growth. People choose to locate where there are work opportunities whether they are new immigrants or relocating domestically. A Metropolis publication concludes (2007) that neither Canadian-born migrants nor immigrants will choose to move to a community with no employment opportunities or other quality of life advantages. This is one of the key impacts of globalization on the growth of Canadian municipalities. Walks (2010) has found that while some large Canadian metropolises specialize in producer services with strong connections to networks of global capital, information, and migration flows, many of the smaller cities that specialize in declining industrial sectors or as transportation depots for the agricultural sector, have seen their economies grow weaker. As such, municipalities with more diversified economic bases will likely see higher population growth. This is why 1st -tier municipalities and their surrounding areas will continue to grow. Municipalities that depend on in-demand commodities, such as oil and energy, are also seeing higher population growth in the short-term as exemplified by the growth of 2nd and 3rd-tier municipalities in Alberta and Saskatchewan. Their challenge will be to diversify their economies as best as possible through long-term planning. If not, they ultimately risk what we are seeing in those shrinking cities of Northern British Columbia and some areas of Ontario, Quebec, and the Maritimes. Figure 17 shows employment rates between 2001-2006. Employment rates are not available for the 1996 census as a separate category and have not yet been made available for the 2011 census. Figure 18 is adapted from Statistics Canada (2011b) and shows the net internal

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Figure 17: Employment Rates between 2001-2006

Employment Rate - Region 66.0% 64.0% 62.0%

Percent

60.0%
58.0% 56.0%

54.0% West
Ont. Que. Mar.

2001 62.6% 60.7%

2006 64.7% 60.9%

58.0% 58.0%

59.3% 59.5%

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Figure 18: Net internal migration rates between July 1, 2010 and June 30, 2011 by census division (CD)

migration rates between 2010-2011. The red colour shows those areas that are receiving inmigration, while the blue shows those areas experiencing out- migration. From 2001-2006, employment rates increased in all types of municipalities as well as across all regions. The employment rate continues to be highest in 1 st -tier municipalities although there was a high rate of increase in the 2nd and 3rd-tiers. From a regional perspective, employment growth is highest in the west, increasing approximately 2 percentage points, although there is relatively high employment in the Maritimes and Quebec, both increasing approximately 1.5

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percentage points. In the Ontario municipalities examined, the employment rate only increased by 0.2 percentage points. There is likely a strong correlation between those areas where employment is increasing and those CMA/CAs that are displaying high internal migration rates in Figure 18 (although one should be aware of the difference in time periods of the data). Contrary to the information that has been presented, there appears to be large areas of out- migration in the west, including areas of Alberta and Saskatchewan. However in almost all of the areas that are included in this study, including the Windsor-Quebec City corridor, there appears to be increasing rates of internal migration; especially to municipalities that are seeing an increase in employment. This represents a shift to urban areas however one should be careful in concluding that rural Canada is experiencing an out-ward population shift. Metropolis (2007) finds that in the 1950s and 60s and between 1981-1991 and 1996-2001, there was out- migration, however from 1971-1981 and 1991-1996, rural Canada and small towns experiences in- migration. It is also important to note that the divergence in urban growth is more pronounced then it would be in smaller, compact nations because of the size and geography, and the diversity of its regional economies (Bourne et al., 2010). The final section focuses on the occupational shift in the structure of employment. Courchene (2012b) points to a number of factors, including the signing of free trade agreements, an increased focus on an east-west series of north-south cross-border economies, the informatics era, the growth of the knowledge economy, and the rise of emerging countries, all of which have had an effect on the changing occupation structure in Canada. Bourne et al. (2010) observe three significant economic changes that are affecting urban areas. The first is the evolving manufacturing landscape. Despite a decline, evident in this study and which concurs with a

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number of reports, Vinodrai (2010) believes that manufacturing will not disappear, and that decline in this sector is a reflection of increased productivity that allows plants to produce more with less workers. The second is the emphasis on innovation and knowledge which has led municipalities to diverge amongst a number of economic development paths; some of which have been successful while others have struggled. Regardless, Vinodrai would see this emphasis as a result of the downward shift in manufacturing and how goods are produced and traded. Lastly, is the increase in cultural industries, which are especially predominate in 1st -tier municipalities. Figure 19 shows the percentage of occupations in six sectors (Manufacturing, Business, Arts, Social services & Government, Services, and Trades) in the type of municipality and region between 2001-2006. Although there are other occupation sectors in the census, these six were felt to be the main ones. Therefore, the data are not reflective of the total percent of jobs, in for instance manufacturing, but simply manufacturing compared to the five other sectors.

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Figure 19 Percent of jobs in each occupation sector 2001 and 2006 17a) 1st tier municipalities

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b) 2nd tier municipalities

Occupation sectors - 2nd tier - 2006

Manuf., 7.9%

Trades, 19.4% Gov., 11.8%

Bus., 23.8%

Arts, 3.5%

Sales, 33.6%

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c) 3rd tier municipalities Occupation sectors - 3rd tier - 2001

Manuf., 9.7%

Trades, 22.4% Bus., 20.4% Gov., 10.1%

Arts, 2.6%

Sales, 34.8%

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d) West region Occupation sectors - West - 2001

Manuf., 5.9%

Trades, 19.4% Bus., 25.6% Gov., 10.8%

Arts, 4.1%
Sales, 34.1%

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e) Ontario

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f) Quebec

Occupation sectors - Quebec - 2006

Trades, 16.7% Manuf., 6.7%

Gov., 13.3%

Bus., 26.4%

Arts, 5.0% Sales, 32.0%

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g) Maritimes

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Occupations in the Sales and Business sectors account for approximately 58.9% of the occupations in 1st -tier municipalities in 2006, which is consistent with 2001 data. Manufacturing occupations have decreased approximately 1.6% while positions in Trades have increased slightly by .5%. There have also been slight increased in the Arts and Government sectors. 2nd-tier municipalities have a similar occupational structure as 1st-tiers in that, in 2006, Sales and Business occupations account for 57.5% of all occupations. Manufacturing is also on the decline in 2ndtiers, but accounts for a larger occupational percent than 1 st-tiers, and fell to 7.9%, from 9.2% in 2001. Trades, Government, and Arts were fairly consistent in accounting for approximately 19%, 12%, and 3.5% of occupations. In 2006, the Sales and Business sectors account for approximately 55% of occupations in 3rd-tier cities. Manufacturing fell slightly but at 8.4%, still accounts for a larger portion of the occupation sector than in 1st and 2nd tiers. Trades have grown slightly to account for approximately 23.6% of occupations. From a regional perspective, occupations in Business and Sales account for approximately 58.7% of the job in the West. This is down one percentage point from 2001. Occupations in manufacturing declined slightly from 5.9% to 5.1%, while the largest increase was in Trades, which went from 19.4% in 2001 to 20.9% in 2006. In Ontario, Business and Sales account for 56.8% of occupations, a slight increase from 2001. There were declines in both Manufacturing and Trades related occupations in 2006. Some of these occupations were picked up by the Government sector, which accounted for 11.1%, up from 10.1% in 2001 as well as the increasing Sales sector. Sales and Business account for approximately 58.4% in Quebec, an increase from 57.7% in 2001. There was a significant decline in manufacturing to 6.7% of jobs from 9.0%. Not

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surprisingly, jobs in the Arts sector account for 5.0% of occupations, and Government sector, 13.3%, which are the highest percent in Canada. Finally, in the Maritimes, Sales and Business account for 62.9%, the highest in Canada, however down overall from 63.3% in 2001. Both Manufacturing and Trade continue to decline in this region, whereas there was an increase in occupations in the Government sector, accounting for 12.3%. In summary, occupations in the Services and Business sector account for approximately 55-63% in all Canadian cities, regardless of type or region. This number appears to be rising in most cases. There is a decline in manufacturing occupations across the country, however this is less evident in the West. As well, the lower the tier of the munic ipality, the more likely it is to have a higher number of occupations in manufacturing. Trades positions have also declined across Canada with the exception of the West, where they are growing quite strongly, especially in 2nd and 3rd tier municipalities. In lieu of increases in these occupational sectors, there appears to be a higher percent of occupations in the Government and Arts sectors in especially Quebec and Ontario, but also the Maritimes. The transition to post- industrialism has been experienced differently across the country and it is evident that municipalities path-dependencies largely depend on their industrial histories, individual characteristics, and the territorial assets of their surrounding regions (Vinodrai, 2010). There appears to be an increasing polarization between the decline of manufacturing and trades in the east, and an increase in the west. The direct result of this, as we have seen over the past years, is increasing internal migration of not only lower skilled workers, but also young, highly educated and skilled workers in the Business and Trades sectors, who are frustrated at the lack of employment opportunities in the east and lured by the attractiveness of

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seemingly bountiful prospects in the west. Positions in the Arts and Government often follow these workers who demand these services. Thus there would appear to be great consequences riding on successful post- industrial transition and economic development in Ontario, Quebec, and the Maritimes. This is most concerning in those areas that depend on a single industry, those that have a higher percentage of jobs in the manufacturing of commodities that are, or a predicted to decline, and government sector jobs as the public service experiences cut-backs. The most important policy tool that municipalities will benefit from are region- focused growth management tools under the guise of Smart Growth. Although lacking a common definition, Smart Growth is essentially the development of a set of policies in response to various political and environmental threats caused by urban sprawl. These threats can include loss of agricultural and environmentally sensitive lands, increased dependency on automobiles, excessive expenditures on infrastructure, and the failure to redevelop existing older neighbourhoods (Burchell, Listokin, & Galley, 2000; Downs, 2005; Meyer & Ye, 2005). What is key is that the Smart Growth concept addresses a number of horizontal elements that determine population growth and management. Meyer & Ye (2005) survey a number of smart growth policy definitions from a series of American planning associations and identified six consistent elements: planning, transportation, economic development, housing, community de velopment, and natural resource preservation. So far, Ontario has been a leader in developing unique growth management plans that have many of the characteristics of the American smart growth policies but designed for a Canadian context. The Growth Plan for the Greater Golden Horseshoe (GPGGH) is an overarching plan to manage growth in Canadas fastest growing region; a region that, by 2031, is expected to account for 80% of Ontarios population growth. There are three overarching goals

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which include growth management (directing growth into areas where growth already exists), infrastructure support for investments and improvements, and conservation and protection of naturally and culturally valuable land. In 2007, The GPGGH was the first recipient from outside the United States, to be awarded the American Planning Association's (APA) Daniel Burnham Award. The award is the most prestigious planning award in the United States. Many of Canadas 1-st-tier municipalities should be looking at this plan in reaching out to surrounding municipalities as a model of regional strategy. Complementing the GPGGH, however encompassing a great portion of land as well as more resource rich, but fragile municipalities, was 2011s Growth Plan for Northern Ontario. This plan was more economically focused than its predecessor and included the four cornerstones of an economic development plan, investment plan, labour market plan, and landuse plan. It also recognizes the distinct bilingual workforce in many communities as well as partnering with Aboriginal peoples. Although time will tell how effective the plan is, nevertheless, it provides a consolidated regional direction. Northern British Columbia, some areas of Quebec, as well as the Maritimes, should be taking note of one example in how to address the same pressing issues that Northern Ontario is dealing with across a broad policy spectrum.

Cost-Benefit Analysis for Growth Areas

One of the options municipalities have in order to determine investing in specific growth areas is that of cost-benefit analysis (CBA). This is especially helpful for those 2nd or 3rd-tier municipalities, which may be suburbs of 1 st- tier municipalities, at deciding whether they should invest in local growth areas and attract economic development, or continue to exist as feeder suburbs of the larger cities. This is a choice that confronts both urban planners and policy

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makers. The Treasury Board of Canada Secretariat (1998) observes that quantitative analysis of probable outcomes of alternative courses of action can diminish the uncertainty and improve the decision- making process (p. 6). CBAs are typically complex, multi- layered projects that must take into consideration a number of variables. However the end result is fairly simplified, which is valuable for politicians, in that it shows the costs, the benefits, the net benefit, the benefit-cost ratio, and the internal rate of return. Lehrer (2011) observes that although CBAs are widely used, some of the caveats include the inaccuracy of measurements tools, an overemphasis on costs and benefits that cant be quantified, they are open to political manipulation, and they can be used as an attempt to remove public decision making from the process. Every attempt should be made to ensure the above issues are addressed, especially the quantification of costs and benefits, and that the public is duly notified and invited to partake in the process. An attempt should also be made to address externalities, which are hard to quantify, and their significance. The objective is this part of the assignment is to demonstrate how a municipality can use a cost-benefit analysis in determining future investment in growth areas. Due to the difficulty and time-consumption in obtaining actual numbers, hypothetical ones have been used however the model calculations remain standard. The town of Okotoks, Alberta, 18 km south of Calgary is the case study town. Although only a community with 24,962 residents, from 2006-2011, it was the 10th fastest growing community in Canada with 42.9% population growth. This year, the policy that initially restricted population to 30,000 was eliminated which paves the way for large growth potential (Calgary Sun, The., 2012). Okotoks has not grown by chance. There have been a number of

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advantages that will continue to draw people to the community, especially as Calgary grows. These include: Available serviced industrial and commercial lands (For Sale or Lease, Build to suitPublic and Private lands); One of the lowest differential non-residential tax rates in the Calgary Region; Highly educated and above average education and income levels; Competitive tax and utility rates and high amenities and services for tax dollar; 10-15 minute drive south from the Calgary city limits, transportation corridors via Deerfoot Trail and CAN-MEX Highway to United States of America & Mexico; and Community commitment to healthy lifestyles, community involvement and sustainability. (Alberta Community Profiles, 2012). First, Okotoks must identify its cost interventions that will require funding from both the Operating and Capital budgets. Loosely, the National Growth Areas Alliance of Australia (2009) identifies there are three types of interventions: Improved public transport services, via rail extensions and complementary bus services; Earlier and broadened delivery of a range of social services, i.e. education, health, recreation, cultural and community services; and Urban form changes, i.e. growing density by introducing mixed-use community around transportation nodes. Table 4 is adapted from the National Growth Areas Alliance of Australia report, and displays the outcomes, costs, and benefits of each of the interventions.

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Table 4: Outcomes, Costs and Benefits of Planning Inte rventions Outcomes

Improved education, health, workforce part icipation and other community outcomes as social infrastructure services significantly bolstered. An increase in jobs in growth areas, both directly and indirectly as a result of imp roved social service provision. Higher quality jobs in growth areas as labour force skills markedly improved. Greater centralisation of jobs in growth areas, as development channelled into strategic centres well serviced by public transport. Improved accessibility of growth area residents to a wider catchment of jobs and services as key public transport lin kages enhanced. Growth area resident travel journeys shortened and less car dependent.

Marginal Costs
Implementation capital expenditure. Implementation recurrent expenditure.

Marginal Benefits
Heightened regional economic productivity associated with: o Improved workforce part icipation rates; o Higher skilled labour force; o A better physically lin ked labour force; o Consolidated business nodes in growth areas; o Improved connections between regional business nodes. Improved choice in growth area communit ies with respect to: o Job opportunities; o Services availab ility; o Co mmunity part icipation; o Housing diversity. Travel demand savings with commensurate savings in: o Travel t ime; o Vehicle operating costs; o Road accidents; o Environmental externalit ies. Deferred fringe develop ment cost as nodal and transit oriented development promoted.

Table 5 displays the hypothetical marginal costs of funding the interventions over a period of twenty years. The yearly results and calculations are found in Appendix E.

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Table 5: Marginal Costs

Okotoks Capital Costs (2013-2031) a) Local govern ment b) Provincial/Federal govern ments

a) $1,400,000/yr for a total of $29,400,000 b) $30,000,000/yr for a total o f $630,000,000

Recurrent Costs (2013-2031) a) Local govern ment b) Provincial/Federal govern ment

a) $10,000,000/yr for a total of $210,000.000 b) $8,000,000/yr for a total of $168,000,000

Total Marginal Costs (2013-2031)

$49,000,000/yr for a total of $1,037,400,000

Table 6 displays the hypothetical marginal benefits of each of the four intervention. Their rationale is as follows: a) Regional economic productivity Growth area residents are more likely to participate in the workforce and gain employment in higher value-added jobs; b) Improved growth area choice - Improving jobs provision, social service provision, housing diversity and transport connectivity in growth areas (and between growth areas and their metropolitan areas) will provide growth area residents with much improved choice. A monetary value can be estimated for this based on a regression of the premium paid on dwellings in highly accessible locations (National Growth Areas Alliance of Australia, 2009); c) Travel savings - Improving public transport, concentrating urban development within growth areas, and locating more jobs and services in growth areas will yield travel related benefits as trips become shorter and quicker; and d) Deferred Fringe Development Costs By concentrating job and population growth, there are there are likely to be significant urban development savings including the areas of network infrastructure extension savings; and non- urban land savings.

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Table 6: Marginal Benefits

Okotoks Economic p roductivity (2013-2033) a) Higher Workforce Participation b) Hu man productivity due to agglomerat ion, human cap ital enhancements

a) $215,000,000/total b) $870,000,000/total

Improved Social Choice (2013-2033) a) Imp roved Choice

a) $37,050,000/total

Travel savings (2013-2033) a) Congestion b) Travel time c) Veh icle operating costs d) Env iron mental externalities e) Road accidents

a) $315,000,000/total b) $107,000,000/total c) $150,200,000/total d) $660,000,000/total e) $6,200,000/total

Deferred Fringe Development Costs (2013-2033) a) Infrastructure savings b) Non-urban land savings

a) $18,500,000/total b) 1,671,800/total

Total Marginal Benefits (2013-2031)

$1,295,621,800/total

Table 7 displays the results of the Cost-Benefit Analysis. The yearly results and calculations are listed in Appendix D.

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Table 7: Cost-Benefit Analysis results

Okotoks Benefit Cost Rat io Net Present Value Internal Rate of Return 1.14 $92,083,179 $258,221,800 or 1.25%

There are two key findings from this cost-benefit analysis. First, the actual investment, or cost, is extremely significant at approximately $49,000,000/yr split amongst all levels of government. The second is that the benefits outweigh the costs. Even if there is a slight overestimation in benefits, there will still likely be a significant overall financial benefit to the community for investing in growth areas. This CBA looked at an all-encompassing growth plan investment as opposed to individual projects. In order to provide a more complete analysis, Okotoks should identify each of the individual projects that compose this larger growth plan (for example, specific transit initiatives, public housing, recreation facilities, etc.) a nd complete individual CBAs. This would allow the municipality to focus on those projects that will provide the greatest benefit and discard those that dont. Furthermore, a more detailed CBA will also take into consideration funding options (T-bill rate, bonds), inflation rate, and the Consumer Price Index.

Concluding Thoughts
The last three decades have seen Canadian municipalities defined by a period of deindustrialization, population and spatial growth, and increased reliance on government services amidst a climate of cut-backs. Approximately two-thirds of the population live in census metropolitan areas with populations over 100,000. Cities, and more increasingly regions, have been recognized as the main drivers of economic prosperity and key components in territorial development strategies. Despite an increasing regional focus, Canadas cities are predicted to face serious challenges in maintaining economic competitiveness not only within North America,
69

but globally. These challenges have been accelerating in some areas, notably Northern British Columbia, Northern Ontario, Quebec, and the Maritimes. Some municipalities in these areas have been unable to properly adapt their economies to the forces of globalization and are seeing shrinking populations as people migrate elsewhere in search of employment and a better standard of living. The role of the planner and policy-maker cannot be understated. Hutton et al. (2010) concludes that the spatial structure of the economies of Canadian municipalities, perhaps more than their American counterparts, reflect the imprint of governments and specifically of public policy decisions made over long periods of time by different levels of government and for different reasons (p. 346). This assignment has evaluated three planning tools linear and multiple regression models in determining the socio-economic characteristics of population growth, descriptive statistics to analyze trends, and cost-benefit analysis that are essential for disseminating quantitative information and the policy decisions that result in the analysis. The results were satisfactory for both the cost-benefit analysis and descriptive statistics, which indentified a number of interesting socio-economic trends in perspective to the types of municipalities and their region. The attempt to produce a viable multiple regression model in order to better understand the relationship of selected socio-economic variables with population growth proved challenging. This was disappointing because the descriptive statistics proved there are relationships between population growth and socio-economic variables, however the magnitude of these is hard to determine. In the couple instances where a model has been successfully created in the past, they typically involved spatial, longer- frame temporal data, and more samples, as well as the use of better statistical software for creating regression models. Moving forward, I would attempt to expand the data (based on its accessibility) for the

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regression models to include the key determinants of growth (births/deaths, internal migration, immigration). My prediction however is that satisfying the assumptions, especially the presence of multicollinearity, would be difficult. As such, most planning authorities will like ly continue to use models such as the Malthusian growth model for population, and a number of economic growth models, some of which are based on occupation sector. The challenge will be for someone to create an accessible, all-encompassing model that can combine both population and economic growth models with socio-economic determinants; especially those that take into consideration variables such as education and value of real estate, that are not typically considered. It will likely be more difficult than expected.

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Appendix A - References
Abbotsford, City of. (2009). Labour force fact sheet. Retrieved from: http://www.abbotsford.ca/Asset9753.aspx?method=1 Alberta Community Profiles. (2012). Okotoks. Retrieved from: http://www.albertacommunityprofiles.com/profile/okotoks Bank of Canada. (2011). Mid-term fluctuations in Canadian housing prices. Bank of Canada Review Winter 2011-2012. Retrieved from: http://www.bankofcanada.ca/wp-content/uploads/2012/02/boc-review-winter11-12peterson.pdf Bourne, L.S., Brunelle, C., Polese, M, & Simmons, J. (2011). Growth and change in the Canadian urban system. In L. Bourne, T. Hutton, R. Shearmur, and J. Simmons (Eds), Canadian Urban Regions. Trajectories of Growth and Change (43-80). Oxford, UK: Oxford University Press Bourne, L.S. & Simmons, J. (2003). New fault lines? Recent trends in the Canadian urban system and their implications for planning and public policy. Canadian Journal of Urban Research, 12(1) (supple.): 22-47. Burchell, R.W., Listokin, D., & Galley, C.C. (2000). Smart growth: more than a ghost of policy past, less than a bold new horizon. Housing Policy Debate, 11(4): 821-879 Calgary Sun, The. (2012, Sept. 25). Okotoks lifts population cap, which means potential for big growth in town south of Calgary. Retrieved from: http://www.calgarysun.com/2012/09/25/okotoks- lifts-population-cap-which- meanspotential- for-big-growth- in-town-south-of-calgary California State University Fullerton Campus, Business School. (2012). Stepwise Regression. Retrieved from: http://business.fullerton.edu CBC. (2012). The 'Manhattanization' of Toronto will change family- housing dreams. Retrieved from: http://www.cbc.ca/news/canada/story/2012/07/02/f- toronto-condo-boom.html Chi, G. & Voss, P. (2011). Small- area population forecasting: Borrowing strength across space and time. Population, Space, and Place, 17(5): 505-520 Clarke, K. (2005). The phantom menace: Omitted variable bias in econometric research. Conflict Management and Peace Science, 22: 341-352. Conference Board of Canada, The. (2012). Metropolitan Outlook 1. Retrieved from: http://www.conferenceboard.ca/temp/99add102-abea-471a-8607-e867f5997e61/13089_MOBook1-Autumn2012.pdf

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Conference Board of Canada, The. (2006). Canadas Hub Cities. A Driving Force of the National Economy. Retrieved from: http://www.conferenceboard.ca/temp/85c905ec-37f1-4fc3-9b13-e27ef65af885/02207Canada%27sHubCitiesRpt.pdf Courchene, T. (2012a). The Fiscal (Mis)Fortunes of Canadas Global City Regions. Lecture as part of Queens University MPA 844. Courchene, T. (2012b). Policy Signposts in Postwar Canada Reflections of a Market Populist. Prepared for the Institute for Research on Public Policy. Retrieved from: http://www.irpp.org/show_study.php?id=393 Czamanski, S. (1964). A model of urban growth. Papers in regional science, 13(1): 176-200 Donald, B. & Hall, H. (2010). Slow Growth and Decline in Canadian Cities. In T. Bunting, P. Filion, and R. Walker (Eds), Canadian Cities in Transition (276-292). Oxford, UK: Oxford University Press Downs, A. (2005). Smart growth: why we discuss it more than we do it. Journal of the American Planning Association, 71(4): 367-378 Eastern Ontario Wardens Caucus. (2012). Facing Our Fiscal Challenges A Report on the Financial Sustainability of Local Government in Eastern Ontario. Retrieved from: http://www.eowc.org//uploads/doc_634665395886048216.pdf Gertler, M.S. (2001). Urban economy and society in Canada: Flows of people, capital, and ideas. ISUMA: The Canadian Journal of Policy Research 2(3): 119-130 Glaeser, E., Scheinkman, J., & Schleifer, A. (1995). Economic growth in a cross-section of cities. Journal of Monetary Economics, 36(1): 117-143 Golant, S. & Bourne, L.S. (1968). Growth characteristics of the Ontario-Quebec Urban System. Research Report #4. Retrieved from: http://www.citiescentre.utoronto.ca/Assets/Cities+Centre+Digital+Assets/pdfs/publicatio ns/Research+Papers/4+Goland+Bourne+1968+Growth+Characteristics+of+the+OntarioQuebec+Urban+System.PDF Government of British Columbia Ministry of Community, Sport, and Cultural Development. (2012). Regional Growth Strategies. Retrieved from: http://www.cscd.gov.bc.ca/lgd/planning/growth_strategies.htm Government of British Columbia (2011). Regional Population Growth and Income Inequality. Retrieved from: http://www.bcstats.gov.bc.ca/Files/ae3161a9-4656-47da-9a4e158091ad80db/RegionalPopulationGrowthandIncomeInequality.pdf

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Government of Canada Statistics Canada. (2012). Annual Demographic Estimates: Canada, Provinces and Territories - Median age, 1982 and 2012, Canada, provinces and territories. Retrieved from: http://www.statcan.gc.ca/pub/91-215-x/2012000/part-partie2-eng.htm Government of Canada Statistics Canada. (2011). Canadas population estimates: Age and sex. The Daily. Retrieved from: http://www.statcan.gc.ca/daily-quotidien/110928/dq110928a-eng.htm Government of Canada Statistics Canada. (2011). Net internal migration rates between July 1, 2010 and June 30, 2011 by census division (CD), Canada. Retrieved from: http://www.statcan.gc.ca/pub/91-214-x/2010000/m004-eng.htm Government of Canada Statistics Canada. (2010a). 2006 Census Dictionary. Complete A to Z Index. Retrieved from: http://www12.statcan.gc.ca/census-recensement/2006/ref/dict/azindex-eng.cfm#P Government of Canada The Daily. (2010b). Income of Canadians. Retrieved from: http://www.statcan.gc.ca/daily-quotidien/100617/dq100617c-eng.htm Government of Canada Statistics Canada. (2008). Census Snapshot of Canada Urbanization. Retrieved from: http://www.statcan.gc.ca/pub/11-008-x/2007004/10313-eng.htm Government of Canada Statistics Canada. (2002). Geographic Units: Census Metropolitan Area (CMA) and Census Agglomeration (CA). Retrieved from: http://www12.statcan.ca/english/census01/Products/Reference/dict/geo009.htm Government of Canada. (1992). The Canadian Forestry Sector: An Industrial and Technological Profile. Retrieved from: http://publications.gc.ca/Collection-R/LoPBdP/BP/bp294-e.htm Gupta, V. (2006). Statistical analysis with Excel. Retrieved from: http://www.officemacros.com/Vol5.pdf Huffington Post. (2012). The Manhattanization of Toronto will change family- housing dreams. Retrieved from: http://www.huffingtonpost.ca/2012/07/03/manhattanization-torontohousing_n_1645387.html Hulchanski, D. (2010) The Three Cities Within Toronto. Report prepared for the Cities Centre, University of Toronto. Retrieved from: http://www.urbancentre.utoronto.ca/pdfs/curp/tnrn/Three-Cities-Within-Toronto-2010Final.pdf

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Hutton, T., Bourne, L., Shearmur, R., & Simmons, J. (2010). Perspectives on Theory, Policy, and the Future Urban Economy. In L. Bourne, T. Hutton, R. Shearmur, and J. Simmons (Eds), Canadian Urban Regions. Trajectories of Growth and Change (330-351). Oxford, UK: Oxford University Press Lehrer, S. (2011). MPA 805 Regression Notes. Ley, D. & Lynch, N. (2012). Divisions and Disparities in Lotus-Land: Social-Spatial Income Polarization in Greater Vancouver, 1975-2005. Retrieved from: http://neighbourhoodchange.ca/cities/vancouver/ Metropolis. (2007). Our diverse cities Rural communities. Retrieved from: http://canada.metropolis.net/pdfs/ODC_Summer07_3_en.pdf Meyer, P.B. & Ye, L. (2005). What is smart-growth really? Journal of Planning Literature, 19: 301-315 National Growth Areas Alliance of Australia, The. (2009). Cost benefit analysis of investment in growth areas. Retrieved from: http://ngaa.org.au/media/298/cost_benefit_analysis_final_report.pdf Nau, R. (2012). Testing the assumptions of linear regression. Retrieved from: http://www.duke.edu/~rnau/testing.htm Semple, J. (2012). Regression Diagnostics. Retrieved from: jsemple.cox.smu.edu/itom6201/Lecture6.doc Stock, J. & Watson, M. (2010). Introduction to Econometrics. Toronto, ON: Pearson Sweeney, Mark M. 2004. Second-Tier Cities: The Right Size at the Right Cost. Business Facilities: The Location Advisor. Retrieved from: www.businessfacilities.com/bf_04_02_cover.asp. Tayman, J., Smith, S. K., & Rayer, S. (2011). Evaluating Population Forecast Accuracy: A Regression Approach Using County Data. Population Research and Policy Review, 30: 235-262 Treasury Board of Canada Secretariat. (1998). Benefit-Cost Analysis Guide. Retrieved from: http://classwebs.spea.indiana.edu/krutilla/v541/Benfit-Cost%20Guide.pdf U.S. Department of Health, Education, and Welfare. (1969). Methods for measuring population change. A systems analysis summary. Retrieved from: http://www.cdc.gov/nchs/data/series/sr_02/sr02_032acc.pdf Vinodrai, T. (2010). The Dynamics of Economic Change in Canadian Cities: Innovation, Culture, and the Emergence of a Knowledge-Based Economy. Canadian Cities in Transition (87-109). Oxford, UK: Oxford University Press
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Wachsmuth, D. (2008). Housing for immigrants in Ontarios medium-sized cities. Report prepared for Canadian Policy Research Networks Inc. Retrieved from: http://www.cprn.org/documents/50555_EN.pdf Walker, R. & Carter, T. (2010). At Home in the City: Housing and Neighbourhood Transformation. In T. Bunting, P. Filion, and R. Walker (Eds), Canadian Cities in Transition (342-356). Oxford, UK: Oxford University Press Walks, R. A. (2010). New Divisions: Social Polarization and Neighbourhood Inequality in the Canadian City. In T. Bunting, P. Filion, and R. Walker (Eds), Canadian Cities in Transition (170-190). Oxford, UK: Oxford University Press

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Appendix B Index of Figures and Tables

Figures Figure 1: Categorical/dummy variables in perspective Figure 2: Correlation results with POP (2006) and other variables Figure 3: VIF results with POP (2006) and other variables Figure 4: Regression Model 1 Figure 5: Results of Stepwise Regression Model 1 Figure 6: Regression Model 2 Figure 7: Results of Stepwise Regression Model 2 Figure 8: Linear Regression Model POPCHG2001-2006 and TRADESOCCU Figure 9: Linear regression to predict - POPCHG2001-2006 and TRADESOCCU Figure 10: Multiple regression to predict - POPCHG2001-2006 and Model 2 Variables Figure 11: Regression Model with Regional Dummy Variable for the West Figure 12: Regression Model with Regional Dummy Variable for Quebec Figure 13: Government Transfers a Percent of Total Income Figure 14: Median age, 1982 and 2012, Canada, provinces and territories Figure 15 Median Income Figure 16: Average value of an owned dwelling between 1996-2006 Figure 17: Employment Rates between 2001-2006 Figure 18: Net internal migration rates between July 1, 2010 and June 30, 2011 by census division (CD) Figure 19 Percent of jobs in each occupation sector 2001 and 2006 Page 7 16 18 20 21 22 23 28 30 31 33 33 40 41 42 45 49 50 53

Tables Table 1: Variables used in the Growth Models Table 2 2006 census and predicted values for Abbotsford-Mission Table 3: Demographic Winners and Losers, 2001-2006 Table 4: Outcomes, Costs and Benefits of Planning Interventions Table 5: Marginal Costs Table 6: Marginal Benefits Table 7: Cost-Benefit Analysis results 9 31 37 66 67 68 69

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Appendix C - Statistics Canada Definition of Key Variables

*Definitions taken 2006 Census Dictionary

Variable
Age Census Metropolitan Area (CMA)/ Census Agglomeration

Definition
Refers to the age at last birthday as of the census reference date. This variable is derived fro m Date of birth. Area consisting of one or more neighbouring municipalit ies situated around a major u rban core. A census metropolitan area must have a total population of at least 100,000 o f which 50,000 or mo re live in the urban core. A census agglomerat ion must have an urban core population of at least 10,000. A set of living quarters designed for or converted for human habitation in which a person or group of persons reside or could reside. In addition, a private dwelling must have a source of heat or power and must be an enclosed space that provides shelter fro m the elements, as evidenced by complete and enclosed walls and roof and by doors and windows that provide protection from wind, rain and snow. Refers to the number of persons employed in the week (Sunday to Saturday) prior to Census Day expressed as a percentage of the total population 15 years of age and over. Refers to all cash benefits received fro m federal, provincial, territorial or municipal governments during 2005. Information indicating the person's most advanced certificate, dip lo ma or degree. Refers to people who are, or have been, landed immigrants in Canada. A landed immigrant is a person who has been granted the right to live in Canada permanently by immigrat ion authorities. So me immigrants have resided in Canada for a nu mber of years, while others have arrived recently. Most immigrants are born outside Canada, but a small number were born in Canada. Refers to persons who were either emp loyed or unemp loyed during the week (Sunday to Saturday) prior to Census Day. Labour force = Emp loyed + Unemployed The med ian inco me of a specified group of inco me recipients is that dollar amount which d ivides their income size distribution ranked by size of income, into two halves, i.e., the inco mes of the first half o f individuals are below the median, wh ile those of the second half are above the med ian. Median income is calcu lated fro m the unrounded number of individuals (for example, males 45 to 54 years of age) with inco me in that group. Average monthly total of all shelter expenses paid by households that own their dwelling. The o wner's majo r pay ments include, for example, the mortgage payment and the costs of electricity, heat and municipal services. Kind of work done by persons aged 15 and over. Occupation is based on the type of job the person holds and the description of his or her duties. The 2006 Census data on occupation are classified according to the National Occupational Classification for Statistics 2006. Population density is the number of persons per square kilo metre. Refers to the regular monthly cash rent paid by tenant households. Refers to the dollar amount expected by the owner if the dwelling were to be sold.

Dwelling, Private

Emp loy ment Rate

Govern ment Transfer Pay ments Highest certificate, dip lo ma or degree Immigrant/Foreign Born Population

Labour Force

Median Income o f Indiv iduals

Median Monthly Payments for Owner-Occupied Dwellings Occupation

Population Density Rent, Monthly Cash Value of Dwelling

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Appendix D Linear Regression results

Model a POPCHG2001-2006 and TOTALPRVDWEL
SUMMARY OUTPUT Regression Statistics Multiple R 0.018329 R Square 0.000336 Adjusted R Square -0.01374 Standard Error 0.092902 Observations 73 ANOVA df Regression Residual Total SS MS F Significance F 1 0.000206 0.000206 0.023862 0.877676 71 0.612789 0.008631 72 0.612995

Intercept TOTPRVDWEL

Coefficients Standard Error t Stat P-value Lower 95%Upper 95% Lower 95.0% Upper 95.0% 0.085986 0.011938 7.202536 4.99E-10 0.062182 0.109791 0.062182 0.109791 -5.6E-09 3.59E-08 -0.15447 0.877676 -7.7E-08 6.61E-08 -7.7E-08 6.61E-08

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Model b POPCHG2001-2006 and IMM

SUMMARY OUTPUT Regression Statistics Multiple R 0.121171 R Square 0.014682 Adjusted R Square 0.000805 Standard Error 0.092233 Observations 73 ANOVA df Regression Residual Total SS MS F Significance F 1 0.009 0.009 1.057986 0.307166 71 0.603995 0.008507 72 0.612995

Coefficients Standard Error t Stat P-value Lower 95%Upper 95% Lower 95.0% Upper 95.0% Intercept 0.077697 0.013042 5.95721 8.97E-08 0.051691 0.103702 0.051691 0.103702 IMM 1.486655 1.445341 1.028584 0.307166 -1.39527 4.368584 -1.39527 4.368584

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Model c POPCHG2001-2006 and EDU

SUMMARY OUTPUT Regression Statistics Multiple R 0.09469 R Square 0.008966 Adjusted R Square -0.00499 Standard Error .0925 0 Observations 73 ANOVA df Regression Residual Total SS MS F Significance F 1 0.005496 0.005496 0.642359 0.425532 71 0.607499 0.008556 72 0.612995

Coefficients Standard Error t Stat P-value Lower 95%Upper 95% Lower 95.0% Upper 95.0% Intercept 0.102327 0.023928 4.276515 5.82E-05 0.054617 0.150037 0.054617 0.150037 EDU -0.07233 0.090249 -0.80147 0.425532 -0.25228 0.107619 -0.25228 0.107619

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Model d POPCHG2001-2006 and MANUFOCCU

SUMMARY OUTPUT Regression Statistics Multiple R 0.094448 R Square 0.00892 Adjusted R Square -0.00504 Standard Error 0.092503 Observations 73 ANOVA df Regression Residual Total SS MS 1 0.005468 0.005468 71 0.607527 0.008557 72 0.612995 F Significance F 0.63905 0.426721

Coefficients Standard Error t Stat P-value Lower 95%Upper 95% Lower 95.0% Upper 95.0% Intercept 0.076183 0.015657 4.865669 6.65E-06 0.044963 0.107403 0.044963 0.107403 MANUFOCCU -0.90442 1.131365 -0.79941 0.426721 -3.1603 1.351457 -3.1603 1.351457

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Model e POPCHG2001-2006 and ARTSOCCU

SUMMARY OUTPUT Regression Statistics Multiple R 0.002305 R Square 5.31E-06 Adjusted R Square -0.01408 Standard Error 0.092918 Observations 73 ANOVA df Regression Residual Total SS MS F Significance F 1 3.26E-06 3.26E-06 0.000377 0.984557 71 0.612992 0.008634 72 0.612995

Coefficients Standard Error t Stat P-value Lower 95%Upper 95% Lower 95.0% Upper 95.0% Intercept 0.085305 0.011626 7.337123 2.82E-10 0.062122 0.108487 0.062122 0.108487 ARTSOCCU -0.07127 3.669245 -0.01942 0.984557 -7.38754 7.244992 -7.38754 7.244992

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Model f POPCHG2001-2006 and TRADESOCCU

SUMMARY OUTPUT Regression Statistics Multiple R 0.236132 R Square 0.055758 Adjusted R Square 0.042459 Standard Error 0.09029 Observations 73 ANOVA df Regression Residual Total SS MS F Significance F 1 0.03418 0.03418 4.192621 0.044301 71 0.578815 0.008152 72 0.612995

Coefficients Standard Error t Stat P-value Lower 95%Upper 95% Lower 95.0% Upper 95.0% Intercept 0.076326 0.011427 6.679714 4.52E-09 0.053542 0.09911 0.053542 0.09911 TRADESOCCU 1.857504 0.907166 2.047589 0.044301 0.048666 3.666342 0.048666 3.666342

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Appendix E Cost Benefit Analysis

Appendix 4 Cost Benefit Analysis 1. Table 5 Marginal Costs *Assume a real interest rate of 5%.
Capital Costs (2013-2033) a) Local Government b) Province/Federal Government Recurrent Costs (2013-2033) a) Local Government b) Province/Federal Government Total Marginal Costs (2013-2033) 2013 $1,400,000 $30,000,000 2014 $1,400,000 $30,000,000 2015 $1,400,000 $30,000,000 2016 $1,400,000 $30,000,000 2017 $1,400,000 $30,000,000 2018 $1,400,000 $30,000,000

$10,000,000 $8,000,000 $49,400,000

$10,000,000 $8,000,000 $49,400,000

$10,000,000 $8,000,000 $49,400,000

$10,000,000 $8,000,000 $49,400,000

$10,000,000 $8,000,000 $49,400,000

$10,000,000 $8,000,000 $49,400,000

2019 $1,400,000 $30,000,000

2020 $1,400,000 $30,000,000

2021 $1,400,000 $30,000,000

2022 $1,400,000 $30,000,000

2023 $1,400,000 $30,000,000

2024 $1,400,000 $30,000,000

2025 $1,400,000 $30,000,000

$10,000,000 $8,000,000 $49,400,000

$10,000,000 $8,000,000 $49,400,000

$10,000,000 $8,000,000 $49,400,000

$10,000,000 $8,000,000 $49,400,000

$10,000,000 $8,000,000 $49,400,000

$10,000,000 $8,000,000 $49,400,000

$10,000,000 $8,000,000 $49,400,000

2026 2027 2028 $1,400,000 $1,400,000 $1,400,000 $30,000,000 $30,000,000 $30,000,000

2029 2030 $1,400,000 $1,400,000 $30,000,000 $30,000,000

2031 $1,400,000 $30,000,000

2032 2033 $1,400,000 $1,400,000 $30,000,000 $30,000,000

Total $29,400,000 $630,000,000

$10,000,000 $10,000,000 $10,000,000 $8,000,000 $8,000,000 $8,000,000 $49,400,000 $49,400,000

$10,000,000 $10,000,000 $8,000,000 $8,000,000

$10,000,000 $8,000,000

$10,000,000 $10,000,000 $8,000,000 $8,000,000

$210,000,000 $168,000,000 $1,037,400,000

$49,400,000 $49,400,000 $49,400,000

$49,400,000 $49,400,000 $49,400,000

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2. Table 6: Marginal Benefits

Economic productivity (2013-2033) a) Higher Workforce Particpation b) Human productivity due to agglomeration, human capital enhancements Improved Social Choice (2013-2033) a) Improved Choice Travel Savings (2013-2033) a) Congestion b) Travel time c) Vehicle operating costs d) Environmental externalities e) Road accidents Deferred Fringe Development Costs (2013-2033) a) Infrastructure savings b) Non-urban land savings Total Marginal Benefits (2013-2033) 2013 $0 $0 2014 $6,000,000 $24,500,000 2015 $6,500,000 $26,500,000 2016 $7,000,000 $28,500,000 2017 $7,500,000 $30,500,000 2018 $8,000,000 $32,500,000

$0

$0

$150,000

$350,000

$550,000

$750,000

$0 $0 $0 $0 $0

$11,000,000 $2,500,000 $3,000,000 $23,500,000 $120,000

$11,500,000 $2,800,000 $3,400,000 $24,500,000 $140,000

$12,000,000 $3,100,000 $3,700,000 $25,500,000 $160,000

$12,500,000 $3,400,000 $4,100,000 $26,500,000 $180,000

$13,000,000 $3,700,000 $5,500,000 $27,500,000 $200,000

$0 $0 $0

$450,000 $45,000 $40,615,000

$500,000 $50,000 $43,040,000

$550,000 $55,000 $45,415,000

$600,000 $60,000 $47,890,000

$650,000 $65,000 $51,365,000

2019 $8,500,000

2020 $9,000,000

2021 $9,500,000 $38,500,000

2022 2023 2024 2025 2026 $10,000,000 $10,500,000 $11,000,000 $11,500,000 $12,000,000 $40,500,000 $42,500,000 $44,500,000 $46,500,000 $48,500,000

$34,500,000 $36,500,000

$950,000

$1,150,000

$1,350,000

$1,550,000

$1,750,000

$1,950,000

$2,150,000

$2,350,000

$13,500,000 $14,000,000 $4,000,000 $4,300,000 $5,900,000 $6,300,000 $28,500,000 $29,500,000 $220,000 $240,000

$14,500,000 $4,600,000 $6,700,000 $30,500,000 $260,000

$15,000,000 $15,500,000 $16,000,000 $16,500,000 $17,000,000 $4,900,000 $5,200,000 $5,500,000 $5,800,000 $6,100,000 $7,100,000 $7,500,000 $7,900,000 $8,300,000 $8,700,000 $31,500,000 $32,500,000 $33,500,000 $34,500,000 $35,500,000 $280,000 $300,000 $320,000 $340,000 $360,000

$700,000 $70,000

$750,000 $75,000

$800,000 $80,000 $58,790,000

$850,000 $85,000

$900,000 $90,000

$950,000 $1,000,000 $95,000 $100,000

$1,050,000 $100,050

$53,840,000 $56,315,000

$61,265,000 $63,740,000 $66,215,000 $68,690,000 $71,160,050

86

2027 2028 $12,500,000 $13,000,000 $50,500,000 $52,500,000

2029 2030 $13,500,000 $14,000,000 $54,500,000 $56,500,000

2031 $14,500,000 $58,500,000

2032 2033 $15,000,000 $15,500,000 $60,500,000 $62,500,000

Total $215,000,000 $870,000,000

$2,550,000

$2,750,000

$2,950,000

$3,150,000

$3,350,000

$3,550,000

$3,750,000

$37,050,000

$17,500,000 $18,000,000 $6,400,000 $6,700,000 $9,100,000 $9,500,000 $36,500,000 $37,500,000 $380,000 $400,000

$18,500,000 $19,000,000 $7,000,000 $7,300,000 $9,900,000 $10,300,000 $38,500,000 $39,500,000 $420,000 $440,000

$19,500,000 $7,600,000 $10,700,000 $40,500,000 $460,000

$20,000,000 $20,500,000 $7,900,000 $8,200,000 $11,100,000 $11,500,000 $41,500,000 $42,500,000 $480,000 $500,000

$315,000,000 $107,000,000 $150,200,000 $660,000,000 $6,200,000

$1,100,000 $100,100

$1,150,000 $100,150

$1,200,000 $100,200

$1,250,000 $100,250

$1,300,000 $100,300 $83,510,300

$1,350,000 $100,350

$1,400,000 $100,400

$18,500,000 $1,671,800 $1,295,621,800

$73,630,100 $76,100,150

$78,570,200 $81,040,250

$85,980,350 $88,450,400

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1. Net Present Value

Year 0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 Real Interest Rate 0.05 0.05 0.05 0.05 0.05 0.05 0.05 0.05 0.05 0.05 0.05 0.05 0.05 0.05 0.05 0.05 0.05 0.05 0.05 0.05 0.05 Benefits $0 $40,615,000 $43,040,000 $45,415,000 $47,890,000 $51,365,000 $53,840,000 $56,315,000 $58,790,000 $61,265,000 $63,740,000 $66,215,000 $68,690,000 $71,160,050 $73,630,100 $76,100,150 $78,570,200 $81,040,250 $83,510,300 $85,980,350 $88,450,400 Costs $49,400,000 $49,400,000 $49,400,000 $49,400,000 $49,400,000 $49,400,000 $49,400,000 $49,400,000 $49,400,000 $49,400,000 $49,400,000 $49,400,000 $49,400,000 $49,400,000 $49,400,000 $49,400,000 $49,400,000 $49,400,000 $49,400,000 $49,400,000 $49,400,000 Total NPV -$49,400,000 -$8,366,667 -$5,768,707 -$3,442,393 -$1,242,281 $1,539,629 $3,313,196 $4,914,361 $6,355,522 $7,648,285 $8,803,516 $9,831,382 $10,741,394 $11,539,819 $12,237,847 $12,843,229 $13,363,205 $13,804,536 $14,173,534 $14,476,087 $14,717,685 $92,083,179

88

2. Benefit Cost Ratio

Year 0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 Real Interest Rate 0.05 0.05 0.05 0.05 0.05 0.05 0.05 0.05 0.05 0.05 0.05 0.05 0.05 0.05 0.05 0.05 0.05 0.05 0.05 0.05 0.05 Benefits $0 $40,615,000 $43,040,000 $45,415,000 $47,890,000 $51,365,000 $53,840,000 $56,315,000 $58,790,000 $61,265,000 $63,740,000 $66,215,000 $68,690,000 $71,160,050 $73,630,100 $76,100,150 $78,570,200 $81,040,250 $83,510,300 $85,980,350 $88,450,400 Total Benefits NPV $0 $38,680,952 $39,038,549 $39,231,185 $39,399,222 $40,245,822 $40,176,237 $40,022,019 $39,791,386 $39,491,965 $39,130,831 $38,714,539 $38,249,162 $37,737,694 $37,188,204 $36,605,473 $35,993,914 $35,357,593 $34,700,255 $34,025,344 $33,336,026 $757,116,370 Costs $49,400,000 $49,400,000 $49,400,000 $49,400,000 $49,400,000 $49,400,000 $49,400,000 $49,400,000 $49,400,000 $49,400,000 $49,400,000 $49,400,000 $49,400,000 $49,400,000 $49,400,000 $49,400,000 $49,400,000 $49,400,000 $49,400,000 $49,400,000 $49,400,000 Costs NPV $49,400,000 $47,047,619 $44,807,256 $42,673,577 $40,641,502 $38,706,193 $36,863,041 $35,107,658 $33,435,864 $31,843,680 $30,327,315 $28,883,157 $27,507,768 $26,197,875 $24,950,357 $23,762,245 $22,630,709 $21,553,056 $20,526,720 $19,549,257 $18,618,340 $665,033,191

Benefit Cost Ratio = Benfits NPV/Costs NPV 1.138464035

89

3. Internal Rate of Return

Year 0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 Total Benefits $0 $40,615,000 $43,040,000 $45,415,000 $47,890,000 $51,365,000 $53,840,000 $56,315,000 $58,790,000 $61,265,000 $63,740,000 $66,215,000 $68,690,000 $71,160,050 $73,630,100 $76,100,150 $78,570,200 $81,040,250 $83,510,300 $85,980,350 $88,450,400 $1,295,621,800 Costs $49,400,000 $49,400,000 $49,400,000 $49,400,000 $49,400,000 $49,400,000 $49,400,000 $49,400,000 $49,400,000 $49,400,000 $49,400,000 $49,400,000 $49,400,000 $49,400,000 $49,400,000 $49,400,000 $49,400,000 $49,400,000 $49,400,000 $49,400,000 $49,400,000 $1,037,400,000 IRR -$49,400,000 -$8,785,000 -$6,360,000 -$3,985,000 -$1,510,000 $1,965,000 $4,440,000 $6,915,000 $9,390,000 $11,865,000 $14,340,000 $16,815,000 $19,290,000 $21,760,050 $24,230,100 $26,700,150 $29,170,200 $31,640,250 $34,110,300 $36,580,350 $39,050,400 $258,221,800

90