Alberta’s economy on the upswing, businesses still face challenges: chamber
The provincial government is expecting Alberta to once again lead the country in economic growth in 2018, but businesses and agencies in Calgary are a bit more cautious in their outlook.
In a post-Christmas news release, the government said the year is ending with increases in nearly every sector of the economy, including adding tens of thousands of full-time jobs and the unemployment rate falling to its lowest level in two years.
“We have more work to do, but it is clear: Alberta is moving forward. All credit goes to the resilient, hard-working and entrepreneurial people of Alberta. By working together, we can continue to create new jobs and a more resilient and diversified economy for Alberta families,” said Deron Bilous, minister of economic development and trade.
One positive in 2017 was Alberta’s overall unemployment rate, which stood at 7.3 per cent in November, down from 7.8 per cent the previous month and nine per cent in November 2016.
However, most of the gains were in lower-paying jobs, suggesting that while there was overall gain in employment, the new jobs were not of great quality.
Scott Crockatt with the Calgary Chamber of Commerce said there are three challenges businesses will face in the new year, the first being unemployment.
“Calgary’s unemployment rate is now back under eight per cent so we no longer have the dubious distinction of having the highest unemployment rate in the country, however, there is still a long way to go,” Crockatt said.
Adding to that is concern over entry-level work available for young people.
“It’s becoming very hard to come by, and especially minimum-wage employers report to us that more than half of them said they had to lay off some of that staff.”
The second challenge, Crockatt said, is the layered costs of government taxation and regulations.
“Over the past year and a little bit before that, businesses have seen a whole host of increased costs. Workplace legislation changes on the employment labour codes, the carbon levy ... as well as minimumwage increases and, a little bit before that, both federal and provincial corporate tax increases,” Crockatt said.
“The impact of one cost after another being layered on top is really having a harmful impact on businesses.”
The third challenge, Crockatt noted, is seeing the positive economic indicators translate into actual business success.
“The economic indicators are all showing positively but businesses are not necessarily feeling this in their pocketbook yet. The challenge for businesses is how they can turn those economic indicators into results for them.”
Meanwhile, local agencies who help the most vulnerable will still be feeling the effects of the economic downturn in 2018.
Although tax credits and the minimum-wage increases have been helpful in putting money in the pockets of clients, Robert Perry, senior director of strategic initiatives at the Calgary Urban Project Society, says there is still work to do for those who need a helping hand.
“The economy is going to help but we have to co-ordinate better, we have to work with people better — everybody needs to come together to solve this problem, it’s not going away,” said Perry.
“A few extra dollars here and there are nice but they’re not going to fix the root problem.”
Perry said CUPS sees around 10,000 people a year, a number that has been increasing year over year.
“The economy is great but we need to get to the root of this. We’ve been here through good times and through bad, these good times that are coming up are going to help but they’re not going to solve it.”
One of the issues Perry is hoping will be addressed in the new year is affordable housing.
The Calgary Food Bank has also not seen a decrease in demand for its services. Over the course of 2017, the food bank distributed more than 68,000 emergency food hampers, which provide seven to 10 days’ worth of food.
Food bank spokeswoman Shawna Ogston said the agency is still seeing families in need whose breadwinners are working one or two minimum-wage jobs, emphasizing that although minimum wage will eventually go up to $15 an hour, the living wage in Calgary is $18 an hour.
“We are still seeing the effects in the downturn of the economy. We’re usually the first to see it and the last to see it because there is such a trickle-through effect.”
She adds that they always anticipate steady, and potentially increasing, demand.