Co-operatives Impact the EconomyAn analysis of the economic impact of co-operatives in Canada.
In 2014, MCDRN researchers George Karaphillis, Fiona Duguid and Alicia Lake conducted an economic impact analysis of co-operatives in Canada for the years 2009 and 2010. The study was conducted based on the latest data available from Industry Canada’s annual co-operative survey. As well, it included data on financial co-operatives via Statistics Canada and the annual reports of six co-operative insurance and investment companies. Mutuals were not included in this study.
About the Study
There were 7,865 self-identified co-operatives reported by Industry Canada in 2010. Of these, 5,065 (64.4%) reported their revenue to Industry Canada. 5,977 co-operatives were included in the study across non-financial, credit unions, and co-operative insurance and investment sectors. Adjustments were made to exclude centrals and federations and organizations that may be reporting source materials and outputs together, and financial co-operatives and six co-operative insurance and investment companies were included.
614,000 Jobs Created
Co-operatives reported nearly 270,000 full-time equivalent jobs directly in the sector in 2010.
Further, when calculating spin-off jobs created, the approximate impact of the sector on the Canadian economy is nearly jobs 614,000 – or 3.25% of total jobs in Canada in 2010.
$54.6 Billion in Value-Add (GDP)
Using the input-output tables at Statistics Canada, researchers took the data from co-operatives across over 60 activity codes used by Industry Canada to determine what ripple effects co-operatives had throughout the economy. Co-operatives, credit unions and co-operative insurance companies had a direct economic impact (GDP) of $22,508 million in 2010 – and through spinoff impacts, the overall impact to the Canadian economy was $54,631 million. This represents about 3.4% of Canada’s total economic activity in 2010.
$33 Billion in Wages Generated
The total household income produced by the co-operative sector in 2010 was 32, 789 Billion.
$12 Billion in Taxes Paid
Finally – taxes paid by co-operatives at local, provincial, and federal levels, as well as taxes induced by other spending, provide nearly $11.68 billion in revenues for governments.
Co-ops Outperforming the Economy
Co-operatives also created jobs at nearly 5 times the rate of the overall economy – 8.6% vs 1.8% – and generated 11% more income for those employed in the industry.
Between 2009 and 2010, co-operatives added 8.7% value-add – nearly triple the 3.3% growth rate of the economy.
Challenges in Conducting a Study on the Economic Impact of Co-operatives (Uzea, Duguid)
Using the experience gained including the national co-operative impact study as part of the Measuring the Cooperative Difference project, MCDRN researchers Nicoleta Uzea and Fiona Duguid contributed a chapter on the challenges of conducting economic impact studies on co-operatives for the upcoming book The Weight of the Social Economy. The book synopsis is below.
What is the weight of the social economy? How should we measure it? Throughout the world, cooperatives, non-profit and mutual benefit organizations, foundations and other social enterprises play an important role in job creation, social cohesion, social innovation, regional development and environmental protection. Observations tend to confirm the ability of the social economy to contribute to balancing economies, mainly by serving as an anti-cyclical force in the face of economic crises. However, many countries and regions lack statistical information about its weight, size and scope on their territory.
This book fills a gap in the literature about the social economy. It seeks to explain why it is important to have statistics on it, to understand how they are produced, and to project how the social economy might be better understood in the future. The book offers researchers and decision-makers an overview of the current state of knowledge on these topics.
Other Co-operative Economic Research
Co-operatives in a Post-Growth Era – Creating Co-operative Economics. Sonja Novkovic and Tom Webb.
Book preamble: For the past three decades, neoclassical doctrine has dominated economic theory and policy. The balance of power has shifted to protect private interests, resulting in unprecedented damage to the environment and society, with no solution in sight as more austerity and less government continues to be posited as the answer to the oncoming waves of crisis.
It doesn’t have to be this way. Featuring a remarkable roster of internationally renowned critical thinkers, Co-operatives in a Post-Growth Era presents a feasible alternative for a more environmentally sustainable and equitable economic system – specifically, the co-operative business model. With more than 100 million people working in co-operatives and more than a billion members around the world, the time has never been better for co-operatives everywhere to recognise their potential to change the economic landscape.
The Economic Impact of the Co-operative Sector in Manitoba
Based on the methodology developed in the MCDRN economic impact analysis, the Manitoba Cooperative Association commissioned an economic impact analysis on the sector’s provincial impact. The analysis was performed by MCDRN researchers George Karaphillis, Fiona Duguid and Alicia Lake.
The MCDRN team helped to provide review and support to the development of an infographic for the project.
The Economic Impact of Social Enterprises in New Brunswick
The study by George Karaphillis suggests that the impact of the reporting social enterprises in New Brunswick’s economy is substantial, with value-added economic output (GDP) of $551 million, 8,612 jobs (full-time equivalent) and employment income of $361 million; for the reporting 232 social enterprises. Considering there were 302,678 jobs in the province, the reporting social enterprises are responsible for 2.8% of all jobs in New Brunswick. In addition, they contribute $167 million annually in taxes.