Economic Development News & Insight


The Higher ED Blog: Newcomers are helping rural communities more than you think

Michelle Madden / May 24, 2016

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The Higher ED Blog: Newcomers are helping rural communities more than you think

Canada, as we know it today, was built on natural resources. From the early days of fish and beavers to today’s oil and gems, natural resources have been and continue to be importance sources of GDP for this nation. The problem with natural resource extraction is that the markets for these products can be fickle, subjecting the peripheral communities that produce them to boom-and-bust cycles. When demand disappears, some communities disappear along with it; others fight back and do what they can to shift their local economies in new directions.

Dawson City, Yukon, is one resource-based community that has refused to disappear. In fact, it has even managed to bounce back thanks to its stock of audacious locals and newcomers. Dawson is famous for being at the centre of the Klondike Gold Rush. Practically overnight, thousands of miners materialized to claim their riches. Just as quickly, saloon keepers, bankers, and prostitutes followed and a “Paris of the North” sprouted from the gold-filled mudflats. Dawson City had 30,000 residents (perhaps more) at its peak in 1898 but by the 1950s it was nearly a ghost town. The decision to relocate the territorial capital to Whitehorse in 1953 could have been a death blow, but instead Dawson leveraged the newly completed North Klondike Highway to start building tourism trade based on the community’s mining and cultural heritage.

Economic developers love a comeback story. For her major research paper for University of Waterloo’s Local Economic Development program, Caili Steel saw an opportunity to study Dawson’s transition (“re-imaging”) from a production-oriented economy to a consumption-based one. She specifically wanted to find out who facilitated the change and, taking inspiration from an earlier study in Nova Scotia, whether newcomers played an important role. To get at this information, Caili researched the history of Dawson then surveyed business owners in the downtown core of Dawson and interviewed key arts, culture, and tourism stakeholders.

Who is responsible for Dawson’s re-imaging?

Caili’s research showed that local residents were the original catalyzers. It was Dawsonites who created the Klondike Visitor’s Association in the early 1950s and organized gold rush-themed tours and events. They even reinvested net revenues in destination development and marketing. Their efforts really took off when the federal government made Dawson a National Historic Site in the 1960s. All levels of government chipped in with strategic and financial support through the years, and the local Tr’ondëk Hwëch’in First Nation got involved with a cultural centre and potlatch style event in the 1990s.

Newcomers, defined as anyone who moved to the community from outside, didn’t play a major role in the early stages of the transition but Caili did find that they’re important capacity builders.

Newcomers build capacity

Caili’s survey was returned by 32 proprietors (representing 35 businesses) out of 71 eligible businesses in the downtown core. Following the Nova Scotia study, the first test was to find out how many business owners were newcomers and the answer was astonishing: out of the 32 proprietors, 29 (90%) were newcomers. Already, the evidence showed that newcomers are important contributors to the local economy by building and maintaining businesses. Since the intent was to paint a more nuanced portrait, here is a summary of ways newcomers are helping Dawson’s transition to a consumption-based economy, and building economic capacity in general.

They perpetuate, construct, and sometimes revive local identities

As mentioned above, Dawsonites chose to develop an identity based on heritage tourism but this research shows that newcomers are doing a lot to keep that identity going. Almost all (87%) of the newcomer-run businesses are in industries related to tourism (accommodations, retail, arts). Some of these businesses do more to support tourism than others, but 81% reported that at least one fifth of their sales come from tourists. Both of these measures indicate that newcomers are engaging in the perpetuation of a tourism-centred identity built by residents and entrepreneurs before them.

The survey responses also showed that newcomers are helping to construct new identities for Dawson. Until recently, the gold rush was Dawson’s main focus but now thanks to newcomers there’s an increasing presence of contemporary arts and culture initiatives. The Dawson City Music Festival, Klondike Institute of Art and Culture, and Dawson City International Short Film Festival (among others) were all created by newcomers. The rise of new identities can be contentious in communities, but this one is appreciated by locals. One Dawsonite interviewed noted that many gold rush-themed events had been winding down but these newer offerings “breathed new life” into the community. The smooth transition like comes from the fact that the newcomers worked closely with locals to start these events and organizations.

Newcomers even helped revive an old First Nations tradition.  When the North Klondyke Highway Music Society started offering fiddle lessons, it discovered from Hän elders that there used to be a strong fiddling and square dancing tradition until the early 1960s. The Society stumbled onto it, but was happy to bring new life to that tradition.

They import skills

Almost all of the newcomers (27 of 29) came from larger communities. In those communities (which included large cities like Ottawa, Montreal, and Toronto) they acquired education and experience. This group is older (58% over 45 years old) and highly educated (77% have post secondary education, 47% have undergrad or graduate degrees). When asked about their business skills, 8 newcomers (of 20 responses) said they developed them outside of the Yukon. Interestingly, newcomers are not just adding their capital to the community but building it as well: 19 of the 35 businesses offer workshops, events, internships, classes, professional development training, showcases, residencies, on the job training, or other learning opportunities. All of these imports and activities enhance the community’s capacity to build the local economy.

The newcomers are also a source of fresh energy for local non-profit organizations and events. Two interviewees said that the Dawson community is very active and volunteer burnout is a problem. The community is very aware that newcomers are tremendous resources and actively recruit them for their energy, skills, and knowledge.

They learn from the community and re-invest the acquired capital

The newcomers picked up skills locally as well. Nine of the newcomers (of 20 responses) said they developed important business skills in Dawson. Some of these skills come from the experience of running a business for profit but they can also be developed while volunteering. Nearly all of the newcomers said they were (or had been at some point) involved with a non-profit organization. The bulk of those organizations were related to local arts, culture, heritage, or tourism. These unpaid opportunities contribute to an upskilling of the workforce, which sometimes leads to the establishment of new businesses or employment at existing businesses and organizations.

They create jobs

The newcomer-run businesses employ an average of 14 workers in full time, part time, and seasonal positions. This is more than double the number employed by Dawsonite-run businesses. This shows that newcomers are playing an important role in providing employment, but there are a couple caveats to note. First, there were only three businesses in the Dawsonite-run business category so the data could be skewed. Second, 31% of the employees at newcomer-run businesses are seasonal residents so their local economic impact is not as strong. That said, these opportunities introduce new people to the community and there is a history of seasonal residents deciding to become permanent (building further local capacity).

Strategy: Attract more residents and embed them into the community

Caili’s research shows that newcomers perpetuate/construct/revive local identities, import skills, reinvest locally acquired capital, and create jobs. It also shows that peripheral and rural communities have a fighting chance of rebuilding their economies based on a new identity. Based on these positive results, she recommends investing in resident attraction. She also recommends engaging newcomers (both permanent and seasonal) in entrepreneurial and volunteer opportunities, which can deepen their ties to the community and enhance the amount of capital they share locally.


About the authors

Michelle Madden is the editor of Higher ED. She is also the Outreach Manager for the Economic Development Program and a graduate of the LED master’s program.  She has authored many Higher ED articles sharing information relevant to economic development practitioners, and has written several on behalf of students. She has published several of her own blogs on as well. Follow her on Twitter at @michelle_mad.

Caili Steel graduated from the LED program in 2015. She works for the Yukon First Nations Culture & Tourism Association as the Associate Producer for the Adäka Cultural Festival.

About the series                                                                                      

Higher ED: Insights for the Next Economy is a platform for students, guest speakers, staff and faculty of the University of Waterloo’s professional and graduate economic development programs to share knowledge with the field at large. The series takes works destined for an academic audience and reworks them into a fresh, easy-to-digest blog article.

Established in 1988, the Local Economic Development program is the only master’s program in Canada devoted solely to local economic development. It offers a balance between theory and practice by combining coursework, a major research paper, an internship, and weekly seminars featuring guest speakers. Students are prepared for careers in local, community, or regional economic development.

The Economic Development Program is a nationally-accredited provider of professional training. It delivers certification programs and seminars that offer a deep understanding of the Canadian context in a convenient block format. Peer learning is combined with informative lectures and practical case studies to provide dynamic instruction that is beneficial for junior and senior-level practitioners.

5 responses to “The Higher ED Blog: Newcomers are helping rural communities more than you think”

  1. Mark Cassidy says:

    Michelle we agree with you that newcomers build social capital in rural communities. Those communities who are actively engaging newcomers (not simply attracting newcomers) are likely to benefit the most. Next month we are launching case studies in communities across Ontario to inventory, measure and publicize the good practices they use, as you say in your blog, “to embed them into the community”. We hope to find Ontario’s Dawson City(s) and share their stories too.

    • Michelle Madden says:

      I’d like to read those case studies! Tag us on Twitter at @UWecdev and we can share them.

  2. Bill Reimer says:

    Hi Michelle,
    Thanks for this story. It is encouraging to see how some smaller and remote towns have been able to manage the ups and downs of resource economies.

    Another example of a similar approach is Inuvik, NT. Their focus was less on tourism, however (because of their remoteness) but using the boom-time resources to make the town so attractive to its residents that when the bust came, they would figure out many different ways to remain in the town. This strategy seems to have been very successful. They have created a lovely recreation centre, schools, hospital, and even a community greenhouse (from the old arena). They have also supported Arctic research and education for others. It’s a wonderful example of building with confidence in the individual and social capacity of residents.

    • Michelle Madden says:

      Hi Bill, that sounds like another great case study. Do you know if there are/were any challenges maintaining the infrastructure post-bust?

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