Performing a PESTEL on B.C.

measure_1.jpg

A couple of recent and seemingly unrelated events should have every person in Vancouver, Victoria and Kelowna sitting up and performing a PESTEL on their cities.

A PESTEL is a planning tool smart companies use to survey the business landscape – a look at where things have gone and where they’re going. Officially, it stands for a study of Political, Economic, Social, Technological, Environmental and Legal trends, but really it’s a kind of free-form look at the world around you.

The first event was the real estate assessment notices that were issued at the beginning of January. As was reported ad nauseum and with great glee, there are now some 50,000 real estate millionaires in B.C. (Actually, I was surprised it was so low – an outhouse on Vancouver’s west side is probably nudging $900,000.)

The second was the government’s huge transit announcement, in which it said it was going to spend $14 billion (or $11 billion, or $4.5 billion, or nothing, depending on who you’re talking to) to extend transit, primarily to the Vancouver suburbs and large B.C. cities like Victoria and Kelowna.

So how are these related? Well that’s where the PESTEL comes in. A PESTEL on B.C. at the beginning of 2008 tells you a lot about what we are and where we’re going to be. And where we are (in Vancouver anyway) is a city undergoing a major transition from a small town with a lot of people to an urban centre with more people than we know how to handle.

This makes us outrageously expensive. When a tumbledown shack riddled with rot sells for more than $500,000, it’s pretty obvious that we have more demand (fueled by greed, of course) than we do supply. People who haven’t been able to ride this greed train – and that’s the majority – then have to fight it out for a dwindling supply. And they’re forced to change their lives in ways they never dreamed of in the past.

For example, if they want housing in the city, they have to settle into some dinky, cramped apartment that was put up almost overnight. This means they’ll likely have to give up their penchant for driving, because the city is getting more and more congested by all those people moving into those tiny flats. They either walk, or take transit, or both, or they just work from an office set up in a closet.

If they want space or a more traditional style of living, they have to go way way out to the outer suburbs, which means they’ll be forced into the morning hour-or-more commute, which means they’ll arrive at work grouchy, tired, and probably broke, given the price of cars and gas these days. And they’ll repeat it in the evening as they return to some place they don’t even like that much but have no choice but to live in because it’s all they can afford.

With this in place, we can see the need for more transit to relieve some of these pressures and move people around what’s become a larger urban centre. And there’s the government, reading the wind, and of course promising it. Whether it will all happen is a matter of debate, and likely will be the cause of much complaining about cost.

So what does a PESTEL tell us about the B.C. of the future?

That it’s going to be a hard place to live. Which means a hard place to do business.