Oshawa’s Economic Resilience in the Face of Change
Oshawa, a small Canadian city east of Toronto, has been dealt a significant blow with the announcement by General Motors Co. that it will cease production at its iconic plant at the end of this year. However, Bank of Canada Governor Stephen Poloz remains optimistic about the city’s prospects for survival and growth.
A Personal Connection to Oshawa
As one of Oshawa’s most prominent sons, Poloz has a deep understanding of the city’s history and economy. He was inducted into the Walk of Fame in 2016, where he reflected on his childhood and growing up in the shadow of General Motors’ factory. "When I was young in Oshawa, there were 10 times as many people working there — 75 per cent of my high school class went to work in General Motors," Poloz said at a press conference in Ottawa.
The Decline of Auto Manufacturing
Auto manufacturing has been a significant contributor to Oshawa’s economy for decades. However, like many other industries, it has faced decline and restructuring in recent years. According to Poloz, the sector will eventually go to zero in Oshawa. "And yet Oshawa has grown and people live there and they all have jobs," he noted. "So, this is what happens in economies, and that’s the thing you have to admire — that Schumpeter’s creative destruction thing is true."
The Creative Destruction of Economies
Joseph Schumpeter’s concept of "creative destruction" refers to the process by which new industries and technologies emerge, often at the expense of older ones. This natural cycle of economic change can be challenging for workers and communities affected by closures and restructuring.
Governments’ Role in Supporting Workers
Poloz emphasized that governments will play a crucial role in supporting workers who lose their jobs due to factory closures. Retraining programs and other initiatives will help individuals adapt to new industries and find employment.
Optimism for Oshawa’s Future
Despite the challenges posed by GM’s decision, Poloz remains optimistic about Oshawa’s future. "The economy will always have the stresses of some form of some things declining," he said. "In the end, I’m confident that we’re going to be okay through all this, and that the key for folks, for example, in Oshawa is to focus on: How do we adjust?"
Adjusting to Change
Poloz’s message of resilience and adaptability is essential for communities facing economic change. By embracing innovation and new opportunities, workers and businesses can thrive even in the face of decline.
GM’s Commitment to Canada
While GM is closing its Oshawa plant, it remains committed to investing in Canadian engineering talent. The company announced plans to hire more engineers in 2016 as part of a push into self-driving cars.
Conclusion
Oshawa’s economic future may be uncertain, but with the right approach and support, the city can emerge stronger and more resilient than ever before. As Poloz noted, "Retraining, and finding new jobs for workers, makes me feel optimistic that we’re going to manage these adjustments reasonably well."
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