FARE-talk is to provide an enduring conversation about contemporary topics relevant to food, agricultural, and resource economics.
Understanding Rural Canada - Octoboer 19th, 2011
Brady Deaton: My guest today is Ray Bollman. He and I will be discussing issues related to rural Canada and policy. Ray has been the focal point in Statistics Canada for rural research and analysis since the 1990's. He initiated Statistics Canada's rural and small town Canada Analysis Bulletins in 1998 and there are 62 of these bulletins now available. We'll provide a URL to them on the website. Before his retirement, he was the Chief of the Rural Research Group at Statistics Canada. Hi Ray and welcome to FARE Talk.
Ray Bollman: Yeah, thanks for calling.
Brady: Ray, let me begin by asking you, how should we think about rural? What is rural?
Ray Bollman: Well different people, we do it differently. I'm an economist, so I would look at the price of rurality and I would look at distance, density and the distance to density. And that's sort of the way the World Bank Rural Development in 2009 on Reshaping Economic Geography clearly stated the issue of regional geography as in density and distance to density. And so density then is the advantages of glomerated economies and the distance to density, there's economic distance, price and time to get there, but there's social distance and psychological distance to density. So I look at it as distance in density.
Some people will talk about is as identity. So if you feel rural, even if you're living in a city, you might behave differently. I would say gee, you're facing the same relative prices in the city, whether you feel rural or not, so I don't think you'd behave differently. Maybe that's an empirical question.
Brady: So for some folks, when you talk about glomeration effects being associated with the density character of urban and then lower density in rural, what are we talking about? A glomeration effects occur in urbanized areas ...
Ray Bollman: It’s because it's a lower cost of people living together and working together. Firms, if they're beside each other, in much the same industry have lower cost because they have better access to specialized labor force. Their employees would go to the same church, or drink at the same bars, or curl at the same curling rinks, and over the conversation just exchange of tasset knowledge. They would just exchange tidbits on how things are done in their particular occupation or their particular industry. And if that firm was in a more remote area, that exchange of tasset knowledge's could not take place. You could read on the internet the written knowledge but the embedded or tasset knowledge that the specialized workers have, that they do not write down, just cannot be exchanged over the internet, you have to do that at the elbow of the master, if you will, and that's a big advantage of a glomerations and having both people and firms being close together.
Brady: So, I guess, part of the idea, is if you're in an urban area, if you take the same person, or the same firm, from a rural area and move them to an urban area, they may be more productive. Because of the exchange of this tasset knowledge and the interactions with experts in the area.
Ray Bollman: Yep.
Brady: Yeah.
Ray Bollman: Yep. More productive or lower cost unit output, same thing. That's right.
Brady: Okay so that's part of the density issue of rural. And the distance, can we think about that, and you mentioned this is cost, takes longer to transport good and information to rural areas.
Ray Bollman: Yeah, to rural areas and from rural areas. So in some sense, the high price distance is an advantage for some rural firms, cause they have a distance tariff and so you might be able to set up a business in a rural area because it's too expensive to import that service, or that facility, yeah that service from an urban area. So the distance is a nice tariff barrier. But the other side is, if you're producing something in a rural area, it's going to cost you something to ship it to the urban market. And it's going to cost you something that you're gonna have a harder time finding out how that niche, or that product, or that market, is developing and how you should change your product. If you're living in the middle of the market, you have an intuitive feel how that market is changing but if you're living away from the market and shipping it to that market, you have harder time just being with the market and I don't know ... what color you have to do, what your promotion should be, how fast you have to change your good or service. So it's just not being aware of the changing market if you're at a distance and so there's a bit of higher cost on the market research side.
Brady: Now I notice in a number of your writings, and we'll makes these available on our website, but you make the point, I think it's a really important one, that rural is not necessarily low density and remote, sometimes it can be high density and remote. And talk to me a little bit about those two issues.
Ray Bollman: Yeah well, and one of the papers you might reference there set up a little grid, and so two by two table, and you could be, if we think of rurality as density and distance to density, so on the table, one dimension is from high density to low density, so as you get to more low density or more rural. But some of those low density places, those small villages, could be in the commuting shadow of a big city. So some of us, if we took our spouses to these small villages that are within the commuting shadow, they would see a cow out the front window and say gee, this is really a rural place.
And your kids would probably go to a fairly small school and have the benefits of a small school, but maybe the cost of a small school. But there might be benefits of a small school. If you wanted to become the editor of the school newspaper, I'm sure you could get on the committee at least. And if you wanted to play basketball, I'm sure you could get onto the team. And but your spouse would have access back to the big city for a big city job, you know brain surgeon, NHL trainer, or whatever.
So if you're a small community, small density, low density community, within the commuting zone of a big place, you have the benefits, if you will, of low density, and the advantages of short distance to density.
So you could go the other way on that grid, from high urban, that's big places, to high rural, which would be long distance. So you could be a long way from a metro center and have a pretty dense town or city. And maybe you think Dawson, Manitoba, or Mattawa, Ontario, or places like that 6, 7, 8. 9,000 people, you might have two high schools in those places that are very competitive basketball teams, and you'd have trouble making the teams. But it's a rural, and small town economy, a small town labor market and there'd just be no jobs there for your professional [inaudible 00:07:34]. And if you became the teacher or the principal of the school and your spouse was a dentist, there's probably already one dentist in that town and there'd just not be a job for your spouse. And they'd be too far away from the metro area to commute. So there's a fairly high density place, looks a bit urban in some sense, but no distance, long distance to a metro job.
So you can have small towns close to areas, or you can have big towns away from metro areas, two different types of rural places and different types of options, different types of opportunities, I guess different types of policy options too.
Brady: I think that's really important point. When I was working, in Central Appalachia from 1995 to 1997, I was confronted with this issue, that there were pockets of real dense housing in relative rural areas. And this was particularly challenging, because the issue that we were working with was trying to address sewage runoff into the river. And the primary way that was being thought about how you deal with this in rural areas, is to put in septic tanks. But in this area of Central Appalachia, where there were pockets of very dense housing, as a result we refer to them often as cole camp areas where houses were developed, basically row houses in a rural area, to house workers that were working in the mines, there wasn't the kind of space to put in a septic tank.
Ray Bollman: Right, right.
Brady: And when you met, often times, with people that were involved in it, their approach to the problem was, oh well this is a rural area, and the way you deal with a problem is to put in septic tanks. But the density was such, within this rural area in the sense it was remote from major cities, that the density was as challenging as any urban area.
Ray Bollman: Exactly. And the general rural observation is if you seen one small town, you've seen one small town. And they're all different. And if you're sitting in the 13th floor of the metro center worrying about rural policy, the capital city worrying about rural policy, rural areas are so heterogeneous that you just can't say, well if it's rural, obviously it's low density and sparse and therefore septic tanks. Because it's just a lot of differentiation out there.
But trap sets the first law of statistics, right? The within variability is always than the between variability, so the between variability between urban and rural, on average, is not very big. But the variability within rural is big, and of course the variability within urban is big. Which is to say within variability is always bigger than between variability.
Brady: And I think it's also important to note, and you note this elsewhere, that if you go and you talk to residents of a quote unquote rural community, they will reflect that variation of understanding in their own discussion. So you might be in what you think is a rural community, and ask them what rural is and they'll refer to a different place in their own county as rural.
Ray Bollman: Okay and it's all perception. You could be the urban center of the county and you are the urban center of the county, and I don't know 2,000, 4,000 people or something, and some of us might think, or some of our spouses might think, that's a very rural town. And colleagues at Brandon University, a number of years ago, were doing some of this, and they were asking people in the countryside, it was more of a health issue, but do you consider yourself rural, what do you consider rural? And one of the conclusions was, I think one of the conclusions was, well I think rural might not be the right word. But the other conclusion was Brandon was a rural city. Brandon was 40,000 people in Manitoba and many people decided it was a rural city. So it's perception is important, and it's not clear one should ever use the word rural, you want the local people, or the residents to define it from their point of view. That's fair.
Brady: I want to move into a discussion, just about general trends, and feel free to add numbers where you like, but talking about, in general terms, will be fine I think. But before I do that, give me a historical context, or what aspects of history, maybe starting from whatever point you feel comfortable, should I understand, to think about rural Canada? And here I'm thinking about things like the initial settlements.
Ray Bollman: Yes, I would observe, I guess, some of the first elements in Canada, were quite self-sufficient. But most of the history of rural Canada is people move in to export things. Labrador, wheeling stations, the cod fishery, up and down the major rivers in Canada the export lumber, the prairie wheat economy, the nickel, gold, copper mines. And so none of those towns, none of those societies were ever designed or started to be an internally, or locally self-sufficient. They were all importing food and importing goods and services and exporting generally raw commodities. So talking about a sustainable rural community is a bit difficult, given that that never really started that way.
It seems to me, I've sat around meetings saying gee, what's so problematic in rural Canada. Well it seems to me, if you think of that history, one idea of the problematic is the increasing value of human times, T.W. Fultz's Nobel Prize lecture, The Increasing Value of Human Time. Well, it's one ongoing constant trend for a long, long time, that the price of labor is going up relative to many other things, certainly the price of capital. And it's good that our real wages are going up. And for rural community, well, there's such an incentive to substitute machines for people in all these exporting industries, that the exports of wheat is up, and lumber is up, and nickel is up, very few people underground in nickel lines anymore, and so on. So increased output, increases export with less and less labor in the towns of fewer people working in these industries.
Now, can you sustain your former population level? Yes, but only if you find something new to export. Cause you need fewer and fewer people to export more and more, or the raise on debt to the community in the first place. And that's the problematic, in my view, is that the communities were started to export products, export commodities, you need fewer people to do it, often, there's nothing else you can imagine to export from this place, therefore the population has to go down. And that's a long run trend in Canada, certainly since the second World War.
Brady: Now are there any trends in labor movements or the labor market, with respect to the aboriginal populations that you can talk about or that we should be aware of?
Ray Bollman: Well certainly, the aboriginal population is younger. And so they're going to be contributing more than their share, perhaps, of their workers on the labor market over time. A couple of examples, as a baseline you might consider Yukon. In Yukon, there's about one person coming onto the workforce, per person leaving the workforce, looking out 10, 15, 20 years. So it's quite a stable demand supply situation for labor. In Nunavut, for every person retiring, there are four people coming onto the workforce, just been looking at the demographics. Much younger society, lot more people coming onto the workforce, relative to those retiring, tremendous demand for jobs, or a tremendous demand for our migration from Nunavat to someplace where there might be jobs.
We could talk about, just in prairies, you probably know from just reading newspapers, the prairie population, certainly in Saskatchewan, maybe 10, 15% of the population's aboriginal now, it may be 20% in 2017, so in the south, the southern provinces, Saskatchewan is the most intensive in aboriginals. But if you look at the absolute numbers, Ontario has the most aboriginals of any province in Canada, partly because of the big northern expanse of Ontario. You go back to the demand for labor and the supplied labor coming on the market, in Saskatchewan, right now, about 20% of the new people coming onto the labor market, 20% of the population 20 to 29 years of age, 20% of them are aboriginals now in Saskatchewan, and looking out 2017, about 30% of this age groups will be aboriginal. Therefore, out 2017, almost a third of the new workers in Saskatchewan, will be aboriginal.
Brady: I'd like to direct some questions now to the relationship between agriculture and rural.
Ray Bollman: There's a different between the landscape and the people scape. If you fly over rural Canada, sometimes you'll see a mine, sometimes you'll see forest, and in general the airplanes are flying over agricultural land. So you say gee, everybody down there is farming. Well, back to the time of the second World War, maybe, and you got the numbers in front of you, I think maybe two-thirds of all the people in rural Canada were living on a census farm, some of them are quite small but still living on a land holding that was included in the census. And that's two-thirds in agriculture are farm, and that was including all the rural areas where people weren't mining, and forestry, and then the few in the [inaudible 00:17:52] maybe even back then. And over time, that people scape has changed. Now if you're in a rural area, maybe 10% are living in a census farm. So it's really a major change in the local politics; used to be farmers on municipal councils, and farmers on school boards and so on cause the vast majority of people in rural areas were in farming families.
And a major change over time, so maybe 10% in rural areas, and therefore on school boards, and municipal councils, and buying things in town, 10% of the families are agricultural. And it's a complete change in the people scape, but the landscape still looks much the same. And so, the Windchill survey versus the fiscal survey has changed a lot. And you can imagine the culture, certainly the political culture, has changed a lot over time.
Brady: You know, that's really interesting. So we think about agriculture policy, we think it's certainly probably still affecting the landscape of rural areas, but not necessarily having the same impact that it had when two-thirds of the rural residents lived on census farms, prior to World War II, on people.
Ray Bollman: That's right. Back then, if you put some agriculture policy out there, it hit two-thirds of rural people. And now if you put an agriculture policy out there, it directly hits 10% of rural people. Might be a bit of a spinoff in linkage, if people driving trucks or in the truck sector, and they're shipping more commodities. But it directly hits 10% of the rural people.
Brady: Now, one other thing that I note, in your article with Bill Rhymer, is that you point out that 20% of agriculture takes place in municipalities, within census metropolitan areas.
Ray Bollman: Yes, those are metro labor markets and back to my distance and density thing, if you're in the commuting zone of a metro labor market, your spouse will have access to a metro type job. And that type of job opportunity means that the rural development problematic, the rural development opportunities, the rural development approach, should be quite different in the sense that you have access to non-farm jobs in larger urban centers. And that's important, and I don't know if you should be surprised that maybe 10% of agriculture is within those zones, cause that would include greenhouse, and nursery, and so on, that have a big advantage being close to big cities.
Brady: Okay so we've talked a little bit about the trend of agriculture, in terms of employment in rural areas, are there other sectors that we should take note of?
Ray Bollman: If you go to these rural areas and look at the numbers, you'd find that up til recently, manufacturing, in Canada, was a bigger sector, in terms of employment, that agriculture. In fact, manufacturing was the biggest sector, all depends how you split up the numbers. So the numbers in the paper with Bill Rhymer and myself, we're looking at if you can put wholesale and retail trade together, 15% of people in rural and small town areas, were working in the wholesale and retail sector. And 13% in manufacturing, and 8% in agriculture. So if we split wholesale and retail separately, then of course, poof we win, manufacturing is bigger. If wholesale and retail are together, then now manufacturing is number two. It was number one four and five years ago.
So one thing Bill Rhymer and I were asking, gee, if manufacturing is such a big sector in rural and small town Canada, would you put a rural secretariat into your agriculture ministry or in your industry ministry? Just to think about that. And it was only two or three provinces still where manufacturing is the biggest sector, certainly in Quebec and in New Brunswick, and Ontario, manufacturing and wholesale and retail trade look much the same. And in the west, there's couple of provinces, certainly in Saskatchewan, and I think in Manitoba, where agriculture is still the biggest employer across all the different sectors. But, Canada as a whole, manufacturing is a big sector, almost as big as shopping, the wholesale and retail trade.
The other interesting thing is that when manufacturing goes up, it goes up faster in rural, when manufacturing goes down, it goes down slower in rural, and over time, oh since 1976 in one of the charts in that paper, the share of manufacturing in rural and small town areas, has slowly and continuously gone up over time. So rural areas are getting a bigger market share of the total manufacturing employment in Canada. Which I have to admit, has been going down for quite a few years and just started recently going up again.
But if you define competitive as increasing your market share, rural is getting a bigger and bigger market share of manufacturing employment in Canada, which may not be a big thing to wave a flag at, because you're just getting bigger part of a declining pie. But still, depends how you look at it. And it's still an opportunity for rural, because manufacturing is an exportable, and rural is relatively competitive in manufacturing employment.
Brady: And why is that? Why is it relatively competitive?
Ray Bollman: Well, part of it is connection to the resource sectors. So saw mills, paper mills, would tend to be near the resources. Not all agriculture processing is in rural areas, cause sometimes you need a big labor force for a big processing plant and you want to ship the raw products there, whether it's beef, or cattle, or ketchup. But the mining, the smelting, would have to take place right near the mine, to reduce the wait, and oil production, pipelines, oil exploration, is largely in rural areas. And the spinoffs, a big share of the spinoffs, certainly in agriculture, forestry, mining, and gas and oil, is services incidental to. Which is all of the background consulting work, the PhD's in geology, the forestry people growing small trees and planting small trees don't really get into the forestry sector, they're usually in services incidental to it and those sectors are growing. But then are driven by the local resources, so that's, I guess switching to manufacturing, but they're connected to the primary sector but not the cutting of the tree. But it's the management of the trees and the replanting of the trees and so on.
Brady: Oh thanks, that was really helpful. We're already basically in the interview, just a couple minutes and I've already learned a lot, so thanks.
Ray Bollman: Good.
Brady: Are there any other trends in terms of income, age structure, that you think we should talk about?
Ray Bollman: Well, lots of people say gee, rural is ... there's a big socioeconomic deficit between urban and rural. And so we started these series of bulletins back in 1998, we often would show the rural urban gap in educational attainment, or average wages, or then so on. And a colleague said come on Bollman, you're never going to get rid of that gap. And you look at the numbers, for 20, 30, 40 years, in constant dollars the rural urban gap in income, I think as we found, in income is $10,000. Family incomes in urban are $10,000 above incomes in rural, in constant dollars, over time. And that's seen almost a constant straight line. Well couple of ways of looking at that. One is that maybe that's just a competitive equilibrium, some jobs in rural Canada and some jobs in urban Canada pay more, just because of density and you want all your brain surgeons in the city, so they get well practiced up in brain surgery. And the other thing is maybe rural people accept lower incomes cause the cost of living is lower in rural.
And if you look at the incidents of low incomes, the incidents of low incomes in rural areas is less, depending on the measure, that the incidents of low incomes in urban areas. Incidents of lower incomes in rural areas is less because the cutoff lines are lower, because the cost of housing is lower. So there's no difference there, between rural and urban areas, if you look at [inaudible 00:26:58] or if you look at the incidents of low incomes, but the average incomes are lower.
So back to the point of what do we do with the socioeconomic gap, I don't think we wanted to close it, therefore we switch around, and from a policy point of view, we say gee, we don't want to try closing the gap, cause I don't think that makes sense. That's too hard, maybe the point is it should never happen. Probably the point is it can never happen. So then you want to say, well look, there's a lot of diversity across rural areas, and policy people will do asset mapping. What are the assets in your community and what assets can be valorized or what assets are underutilized? Where can policy and where can local communities invest in an underutilized resource to increase the community's strategies and options? But don't try to close the rural urban gap on measurable outcomes like incomes.
Brady: One other issue, before moving out of the trends maybe, and I think directly into policy, and I think we'll touch back on some of the issues that you've discussed, is what's immigration in general? It's a big part of the increase in population and it appears to be something that's gonna increase. How does that work, in terms of rural and urban issues?
Ray Bollman: Certainly, historically, immigrants largely prefer the bigger cities, which are Metro Town and Vancouver, and they get the vast share of new immigrants. And you talked immigrants, you look at the numbers and read the history, and if you were going to move to, I don't know pick Australia or South America or something, you would use your connections and you would talk to some comedians or Americans that you knew there, and give me some information, what's a good community to live in? Well that's exactly how people move to Canada. They all know somebody that knows somebody that's here, give me some information, and they'll often in end up on the same street or the same apartment, and so on.
So there's a much lower risk and a lot more information for immigrants to move to where other immigrants already are. But you can't say the rural areas are losing cause Metro Town and Vancouver attract a lot of immigrants. Downtown Toronto, typically, 1 in 30 people, 3%, arrived last year. There are some rural areas, and this year it's Winkler, Morton, Altona and Manitoba, go to downtown Winkler, walk the streets, 1 in 30, 3% of the people arrived last year. Winkler and area is just as competitive in attracting immigrants as Toronto. In fact, last year it beat Toronto.
So if you look at where immigrants are moving and what share of the population last year were immigrants, what share of the population were immigrants in the last five years, certainly the big cities rank highly. But the smaller cities, often do not. Quebec City, or St. Johns, or even Halifax, tends to rank much lower than some of the rural areas, Fort McMurray, Brooks, Alberta the beef processing plant. Neepawa, Manitoba, with the hog slaughter plant, many areas in rural areas are attracting immigrants at a higher rate than the bigger cities. Now, overall vast numbers still go to the big cities.
And a minute ago, you asked about demography, the one interesting thing about demography is to say rural is not a basket case in the sense of let's not focus on this rural urban gap. The other evidence that rural is not a basket case is that since 71 or 76, right up to the most recent census, rural areas attract more people in each age class from 25 to 69 than they lose. People vote with their feet, can move to rural areas in each age group from 25 to 69. After 69, well maybe I should move back cause there's a bigger cost cut.
Before 25, you're moving for either jobs, or fun, or entertainment. Jobs, education, or fun. So rural is a preferred location for living, on a net basis, migration, voting with your feet, for each age group from 25 to 69.
Brady: So Ray, I'm really interested in, from your standpoint, what are the objectives, how generally do we think about the objectives or rural policy?
Ray Bollman: Well I guess I would start with Economics 100 book but it's generally, I would say, can you make the pie, or can you make the economy bigger. And then the second point of policy is can you, or are there places you want to, redistribute the pie? I don't know from the rich to the poor. So making the pie bigger is making your economy more efficient, or increasing the input in more labor, more capital, better land quality, and so on. So making the pie bigger, job one, I think, and then the second job is making redistribution to improve social welfare.
Brady: So an education policy that improved the capacity of folks in rural areas to be more productive would be an example of efficiency in production. And then a policy that, potentially, redistributed taxes to support education programs in rural areas might be an example of this redistribution or this re slicing of the pie.
Ray Bollman: Yes, I think that's a good example. So I think the way I answer your next question is, what is rural about development in rural areas?
Brady: Mm-hmm (affirmative).
Ray Bollman: And if I can restate the question. And some people teach economic development, even Michael Porter was trying to say in one of his publications that well, economic development is economic development. Yeah, it might be a big different in rural and urban areas, you always situate yourself in your geographic situation. So whether you're in New York, or Guelph, or Brandon, they all have urban functions of some sort, but they're all different in terms of linkages and density, and so on. So but maybe even say economic development is always the same, you want to invest in human capital, you want to lower transaction costs, all the same things you want to do. But then, the next question is, okay what is rural about doing development in rural areas?
And then I come back to the definition of rural, well what is rural, is you gotta think low density. And what is rural, you gotta think long distance. So maybe Brandon, certainly is long distance to the next city, a couple of hours at least to Winnipeg for example. And maybe it has high enough density, it has a high enough density for a small university of 3 or 4 thousand people. But it does not have a high density enough for, I don't know, a faculty of engineering, who you might have spinoffs in various high tech innovations.
So what is rural about development in rural areas, then you want to think okay, economic development is economic development, but it's different in low density and it's different with long distance to density.
Brady: So in terms of policies that have kind of dealt with this issue, and you mention a couple, there's infrastructure, there's transportation investments, education investments. Are these different, do they have different effects in rural areas than they have in urban areas?
Ray Bollman: First, I've never done any studies on that, cause there's not good numbers on that, so I have to give a short answer, I think the really short answer is I don't know. Some things I think we might agree on, that it's expensive to put in a road if there's only a few people going to use it. So how big is the road, do you put a road in and then hope it develops, or do you wait for the place to develop and then put in a road? And it's a catch 22, I don't know how you decide that. But general issue is, is that infrastructure matters and the price of the infrastructure, on a per capita basis, might be higher. Whether it's a water treatment plant, whether it's putting in community college and education function, whether it's putting in a small, mini size airport for transportation function, all of those things can be somewhat higher cost per capita in a rural area.
And then, is there an equivalent benefit from efficiency point of view, and is there a benefit from the wealth redistribution point of view? And those are answers I do not know and maybe if I read more of the studies, I'd know more, but probably should pass on that. We could have a good discussion on that, but I don't know any good facts for it. I don't have any facts to contribute.
Brady: Sure, sure. Fair enough.
Ray Bollman: Some of the stuff we've done on price of rurality, one of the pieces done with a colleague here at Statistics Canada, was the price of transporting goods has been going down. But the price of transporting people has been going up. The price of transporting communication, transporting information, has certainly gone down, except the price of stamps is going up, or not going down, so the cost of mailing a letter hasn't gone down. But the price of moving information has certainly gone. But the tasset knowledge obviously you don't, we talked about that before, it's hard to move that over internet, or whatever.
So moving people is up, moving goods is down, moving information is down, and so on. So some prices of rurality have fallen.
Brady: So that really brings one issue up that you hear mentioned a lot. And I actually have a colleague in Ethiopia, and he was telling me that in rural Ethiopia, even where there aren't landlines for telephones, people have cell phones. So that seems to be, in a broad international sense, the price of information. Or at least, some aspects of some information, is going down. When I hear broadband, typically, is a big issue that comes up a lot of times when people are talking about rural development and the cost of information, the advantages that might give. Can you talk a bit about that?
Ray Bollman: Well, again, I'm not too familiar with it. Certainly, the bigger your metro center, the higher the feed of your broadband. Cause the bigger the return to investment for the first person building the faster networks, and so the connectivity in rural areas is increased dramatically over the last 10, 20, 30 years. But the speed in urban areas is always faster. So the urban connectivity prices are always lower, the capacity is always higher in urban areas. They're always gonna have a quicker, faster, bigger, ability to transfer pieces of information than in rural areas. All these rural areas, in my view, is going to be increasing fast, they're always behind urban areas in terms of broadband coverage and whatever the big words are for faster and faster and bigger and bigger broadband these days.
It’s a good news, bad news situation. Things are getting a lot better, but we'll never catch up to the urban. Something like the income situation.
Brady: Okay so the speed is getting faster everywhere, but the relative speed of access, internet access, is going to continue to be cheaper in urban areas.
Ray Bollman: That's right.
Brady: Than in rural areas.
Ray Bollman: Yeah, you said it better than I. That's good.
Brady: One thing that you've mentioned, that's always seems to be attention in rural areas that I've worked with, has been this both wanting to educate and better the people in this area, and this fear of losing them. And that's a real challenge, because as you mentioned, for most of these areas, they were settled for the export of commodities and the relative price of labor has increased, so people are incentivized to leave, in part because of the history of the area. But the people there, often, one of the challenges they face, is to stop, to almost stem, this out migration. And what can places that feel like they're losing, how should ... have you run into, or are you aware of any policy or approaches that help address that situation? Or do you have a take on it?
Ray Bollman: Quick answer is probably not much. Certainly the statistics say gee, a lot of quote unquote kids, teenagers, leaving rural areas. And so I put up numbers, and I say isn't that terrible, oh yes, it's terrible. And I say yeah, it should be 100%, kids leaving rural areas. They should go out and get education and world experience and then you want to try to attract them back. Therefore, I have to quickly run for the backdoor of the rural hall because obviously, I don't know what I'm talking about. And some of them are absolutely right, I don't know what I'm talking about, because somehow you want to keep people that are not interested in getting a PhD in socioeconomics, cause you'll never move back to a rural area, you want to try to inform kids, or I shouldn't say kids, youth and young adults, what are the opportunities in this area.
And in this article, Bill Rhymer reported a couple of articles where analysts had gone into high schools and asked people in high schools, tell me about the jobs in this community. Well they didn't know that there were four accountants, two dentists, five people with MBA's, at least bachelors in business administration running garages and so on. And they didn't know that if they took these professional programs, that there was not a job opportunity back in their community. And so one way is to help kids understand just what are the options in this community.
One community I was in, in Russell, Manitoba, I was sitting around the outside, I was gonna give a talk later, and a fellow asked the chair, who was also new to the community, looked around, 20 people I think sitting around the table, quite an impressive turnout for somebody to only list statistics. He said how many people grew up in this community? How many people were born and grew up in this community? 20 people around the table. 1 person, these were all business owners, generally, or business development officers, 1 person out of 20, in Russell, Manitoba, had grown up. And the other person said well can I put up my hand, I moved here when I was 2 years old.
Brady: That's an amazing story.
Ray Bollman: So two ... amazing, he was surprised. I think a lot of the people around the table were surprised, that there was so much immobility and that was community was so attractive to both, business owners and community development officers. And Russell, Manitoba may not be on your radar as a successful rural area. It is. And there are a whole bunch of places like that. So can you keep, or can you get people going away to get your bachelors in business administration, and coming back to your community? I don't know. That's one thing you might focus on. Cause some communities can bring in people that did not grow up there. So there are options.
Brady: Well on that up note, Ray, I think I'd like to give you the opportunity, if you want to, to raise any issues that maybe I haven't asked you about. But also, if you look back over your career and your own thinking about rural issues, and you look to the future, I'd be interested if there's any lessons, or issues that we should be thinking about for the future, or lessons that maybe people might forget in our worth, kind of always keeping in the fore of our minds as we work on these issues.
Ray Bollman: That's a good question. Have I learned anything from all this? And I guess one thing, I think we talked about this, people go around and we talked about a study done a while ago, why do youth leave rural areas? They said number one, jobs, number two, education, number three fun. And then for the people that had left, they asked, what would cause you to return? Jobs was not number one. Jobs was not number two. What would cause you to return to rural area, if you'd already come from a rural area, was number one was family, number two is community and I'm not sure the difference between family and community. But it was a nice place to call home. Nice if your raising kids, or having a family. Just a good place to do that and you want to be back into your social networks.
So maybe one thing to learn is communities want to build on their diasper, find out who was in high school five years ago, talk to the parents. What would it take to get these kids that have been away from the town for five years, get them to come back. So that should be one opportunity.
Brady: Well Ray, thank you so much for joining us today.
Ray Bollman: Well thanks for the call and thanks for the good questions.
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