The Van Mag Q&A: Andy Yan on why Vancouver has such low incomes

The popular urban planner spoke with Van Mag for our June cover story on the plight of young professionals. Here's that conversation

June 10, 2016

By Trevor Melanson

Vancouver has its share of urbanism gurus, but Andy Yan is certainly near—if not at—the very top of that list. Yan, an urban researcher at Bing Thom Architects, an adjunct professor at UBC, and more recently the acting director of the city program at SFU, is anything but media shy. He’s weighed in many times on the affordability debate with nuanced, data-focussed insight—including a contentious study last fall that revealed that 66 percent of buyers in three west side neighbourhoods had non-anglicized Chinese names (implying they were new arrivals)—and last year earned a place on our Power 50 list. He recently spoke with Van Mag about another, although not entirely unrelated, issue: Vancouver’s low median incomes.

Back in 2014, you dug up some truly jarring numbers regarding incomes in Vancouver. You found out that the median income for degree-holders in Canada’s 10 biggest cities was $50,981 while in Vancouver it was just $41,981—exactly $9,000 less.

That was a slideshow we had shown two or three years ago based on a Statistics Canada special data run, which looked at 25-to-55-year-olds throughout Canada by metropolitan area and total median income. It was surprising to me and everyone else to find out Vancouver was dead last for that particular demographic group. Vancouver attracts people at the very beginning of their career, and there’s a part of this that’s just because they’re starting their careers. But then I think it’s really surprising just to see how it further complicates itself into those older ages, which again was really surprising to see how consistent it was. That wasn’t really expected in our study. It’s an interesting age range because that’s typically when you’re finished your formal education, after the age of 25.

Which raises an obvious question: why do educated workers make so much less money here?

It’s funny. Which has more head offices: Vancouver or Calgary? Vancouver actually has more head offices than Calgary. However, they are half as big as those in the City of Calgary, which I think tells you that the employers in Vancouver that have head offices tend to be small. And I think that’s part of the issues that shape this… Vancouver actually has the second smallest head office size in Canada [among the 10 largest metro areas].

What city is number one, in terms of head office size?

Number one is Toronto, two is Montreal, and in last place is Edmonton.

While doing research for my feature story, I discovered that B.C. students not only carry the most student debt in Canada but they pay the highest interest rate on that debt. I’m wondering, what happens when you combine what’s essentially the country’s worst pay cheque for educated workers with the worst student debt payments?

It’s really hard to create a garden of new economic activity under an inch of concrete as represented by student debt. We may very well attract some of the smartest and brightest around in this country, but to saddle them with at times very significant debt I think limits their potential—and if anything is a motivation to get out of a region that may not pay as well as other regions. Take a tech worker that has trained at a local university. It’s only rational for him to move to other places like San Francisco or Seattle. There’s a very specific logic to that. It’s not about talent attraction but retaining talent, which is probably one of the biggest challenges for Vancouver.

It’s also the reality that when you’re in your 20s or 30s, you’re in the most mobile period of your career. And in an economy that’s increasingly dependent on young talent, the ability to capture and retain that talent—it’s a major economic challenge. And housing costs don’t particularly help the situation. There are going to be four consequences of this housing market: one is overcrowding, two is over-indebtedness, three is sprawl, and four is ultimately migration out of the region.

So, what can be done?

There are certain avenues that we need to explore. The first is actually seeing how well our skills match the economy that we have in British Columbia. That’s important.

If you think about generalized strategies for economic development, there are three areas: hunting, fishing, and farming. You send your team out, and you hunt for people to come to your city. Or you lay out the bait and see if you can fish for talent by providing amenities and lifestyle choices that will perhaps attract firms into your city. The third concept is to talk about how you can farm local talent, how you can farm local firms. And that, to me, was one of the big insights we had in our study. We actually have all these small head offices in Metro Vancouver, and really our challenge is to help nurture them to have the capacity to grow, as opposed to only attracting new firms in the region.

At the core of this, it really is a question of how can Vancouver be a city of the future for the future. Vancouver is of the future, but then without the ability to create a city for the future—that is, for young people, for young workers, for young families—there will be profound challenges on the road ahead.

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