Estimating the size of the ED industry

Somebody recently asked me what the size of the ED market would be across North America. It’s impossible to say for sure but I can make a conservative estimate. I did a little analysis a couple of years ago and there are roughly 8,000 ED agencies in Canada and the U.S. and well over 100,000 people working in the field (that includes local, provincial, state and federal government employees as well as Chamber of Commerce agencies that have ED officers, even most U.S. utilities have ED officers).

In New Brunswick alone, there are close to 700 people working in ED (ACOA, BNB, Industry Canada, Enterprises, local municipalities, the French RDEEs, etc.).

It’s impossible to put a $ figure on it but again a rough estimate would be somewhere in the order of $12.5 billion (assuming $125k budget per employee in the ‘industry’) per year in just operating costs (not including incentives).

Again, impossible to know how much goes to consultants but even if it is 5% – that would make ED consulting a $625 million business each and every year.

That’s a big business.

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0 Responses to Estimating the size of the ED industry

  1. Anonymous says:

    Hey David, you are starting to sound like those PNB spin doctors… Now, how many people are ACTUALLY working on ED in NB? You will have to cut at least 50% of the BNB and ACOA employees there…

  2. Rob says:

    I guess you could take one of two views on this post:

    1) 700 people in economic development, and look at the state we’re in. What a waste of money and effort.

    -or-

    2) It takes 700 people to get NB to this point. Imagine how awful our economy would be w/o these workers.

  3. nbt says:

    You know I’m not a big fan of too much government interference in the economy.

    However, if you want my opinion, I think it comes down to the policy/lawmakers themselves, as it is not the ED consultants or bureaucrats who should be blamed for the lack of economic initiative in New Brunswick. They can only offer guidance (the tools to succeed), they can’t implement the political will to reform the system or inject leadership into unqualified politicos.

    Case in point: self-sufficiency report where the tough measures added by experts were completely ignored.

    Moreover, I’m holding onto a municipal longterm strategy report co-authored by the writer of this blog. Let me tell you, if even 25% of the report was followed my region would be in better shape. Unfortunately, I can’t see one piece of advice here that was moved on by elected officials. Sad indeed, not to mention, costly.

    So if I had to pick between 1 and 2 Rob, I’d have to go with the first one as the few good ideas touted never see the light of day anyway. Maybe some of the ED experts should get themselves democratically elected and lead this great province back to at least respectability. Hint, hint, David.

  4. richard says:

    “1) 700 people in economic development”

    I think it would be more correct to leave in the ‘consulting’ word.

    Like most consultants (and most markets for that matter), most ED consultants tailor their reports to suit the person paying the tab. That’s probably why the reports end up being ignored – the next manager assumes the report ordered by the previous manager is biased. He thus orders another report attuned to HIS biases. Consequently, whether they are brilliant or ludicrous, consulting reports have a short ‘best before’ date.

    Sorry, but I put the ED industry and the associated consultants in the same class as sociologists, english lit profs, political scientists, economists, etc. Too loaded down with bias and self-interest to produce a useful report.

  5. Gawain says:

    In what other industry would we mount the COSTS and say that’s a big business. Usually, you frame the size of an industry by its sales or revenues or earnings, not costs. Costs are rising in the NB forestry industry, but we would scarcely say that the industry is growing.

    At that rate, we could develop a roaring business in buggy whips in NB provided that we spent enough…

    Actually, are we not already doing that?