JOB GAINS BEAT EXPECTATIONS

Edmonton’s chief economist likely to boost 2018 growth forecast

The Edmonton region created so many jobs in 2017 that the city’s chief economist says the coming year could be even stronger than he originally expected.

“We continue to see employment gains in Edmonton pretty much throughout 2017. In December, a modest 1,500 jobs was added. Nonetheless, it was positive,” John Rose said Friday.

“With the unemployment rate coming down, this is obviously a good thing … I will be probably boosting my forecast for 2018.”

New figures from Statistics Canada show Edmonton’s unemployment rate dropped in December to 7.5 per cent, the same level as a year earlier and the fourth monthly decline in a row.

About 26,000 jobs were created over the previous 12 months in such fields as manufacturing, construction, transportation and warehousing, and health care.

Rose, who had thought the local unemployment rate would be around eight per cent at this point, now thinks it could sink as low as 7.2 per cent on average over 2018.

At the same time, he’s looking at revising his estimate for annual economic growth to three per cent from 2.5 per cent to 2.7 per cent.

“I wasn’t expecting we would get to that until 2019 … The economy is improving at a better pace than I was expecting.”

Ken Rosenau, president of Rosenau Transport Ltd., said his firm added at least 20 drivers in Edmonton last year and he’s confident that this year he’ll match the “outstanding” 2014 results reached before the recession.

“Any time there’s a downturn in the economy, advantages come up for certain companies. We took the opportunity to open new markets,” he said.

“Back in the heyday, the oilfield type freight represented about 25 per cent of our business. Nowadays, it’s about 10 per cent. However, we’re seeing strong recovery in the energy sector. We’re (also) focused on customers and opportunities we have never had before.”

Alberta and Quebec led the country in employment gains last month, with the number of jobs in Alberta up about 26,000 mainly full-time positions.

The unemployment rate in the province fell by 0.4 percentage points to 6.9 per cent, while the national figure continued its downward trend to 5.7 per cent, the lowest since comparable data became available in January 1976.

“As this recovery lays in and becomes more broad-based across all sectors, my view is, my hope is, that we’ll see the unemployment rate continue to drop,” Alberta Finance Minister Joe Ceci told reporters in Calgary.

“I know there are many unemployed Albertans still out there and they want to get back to work.”

Economist Rose said the biggest risk to Edmonton’s growth is the provincial fiscal position in the face of a $10.3-billion deficit, raising the possibility of “Ralph Klein 2.0,” a reference to the spending cuts the former premier implemented in the 1990s.

“How are they going to deal with the deficit? They’re going to have to deal with it one way or the other, whether it’s the NDP or another government.”

There are other concerns. Michael Bevan, stakeholder relations manager for the Building Trades of Alberta, described the mood among their 75,000 unionized members as “pensive.”

While they anticipate more maintenance and turnaround work this spring than local carpenters, pipefitters, ironworkers and other trades can handle, these jobs will last a few months at most and opportunities for people in other fields are limited, he said.

Several big construction projects are winding down and nothing major is on track to replace them, he said.

“They’re saying look at the positive job numbers. We’re saying ‘Great for the province, but not for our members. We need projects to work on’.”