Harder times

The Compass - - EDITORIAL -

Like the gap­ing holes that opened up on roads around St. John’s this week, the re­al­i­ties of New­found­land’s fi­nan­cial mess keep knock­ing us off our bear­ings.

Last week’s up­date: em­ploy­ment in­sur­ance claims in St. John’s shot up more than 27 per cent in 2015. That’s 950 more peo­ple col­lect­ing pogey in the cap­i­tal since this time last year. The av­er­age jump across the prov­ince was 10.5 per cent. Sta­tis­tics Canada says the trend ac­cel­er­ated af­ter last sum­mer.

Un­less you’re among those who’ve landed on the EI rolls, it’s some­thing you may not have no­ticed in your daily trav­els. But it shows how in­sid­i­ous the plunge in oil prices since 2014 has been. And few peo­ple will es­cape feel­ing the sting at some point down the road.

None of this was un­ex­pected, as Me­mo­rial Univer­sity econ­o­mist Wade Locke pointed out in March 2015.

“The im­me­di­ate im­pact of the fall in the price of oil will be through peo­ple be­ing laid off and projects be­ing de­layed in Al­berta,” Locke wrote, as posted on Thinkpol.ca. “That will have a dra­matic and no­table im­pact on our par­tic­u­lar econ­omy.”

It’s es­ti­mated about four per cent of New­found­land and Labrador’s work­force mi­grates to­wards oil­sands em­ploy­ment.

When you add that to the fact Al­berta lost at least 60,000 jobs in the first eight months of 2015 alone, you can see how the num­bers are adding up.

But it is still Al­berta that’s tak­ing the big­gest hit. In Cal­gary, the num­ber of EI claimants has dou­bled, with about 10,000 more peo­ple re­ceiv­ing ben­e­fits.

And Al­ber­tans are get­ting testy. A few barbs have been fly­ing around about eastern­ers who’ve milked the boom­ing Al­berta econ­omy for decades. Ex­pect that re­sent­ment to linger.

Of course, Al­ber­tans didn’t put the oil in the ground any more than New­found­lan­ders put it un­der the ocean.

It’s all just fis­cal jit­ters at a time when there’s lit­tle to fall back on. It’s the fed­eral govern­ment, af­ter all, that has to back up EI claims. And the feds, along with pretty well ev­ery prov­ince in Canada, are awash in red ink.

John Cros­bie, a vet­eran of pro­vin­cial and fed­eral pol­i­tics, didn’t mince words Wed­nes­day about this prov­ince’s woes.

“If any­thing hap­pens that we get caught in a huge debt that we can’t han­dle, it’s quite pos­si­ble that we end up back in a sit­u­a­tion some­what anal­o­gous to that of the 1930s,” he told re­porters fol­low­ing a briefing by au­di­tor gen­eral Terry Paddon.

You’d think it might be the per­fect time for Canada to pull to­gether, rather than point fin­gers in ev­ery di­rec­tion.

Hope springs.

A few barbs have been fly­ing around about eastern­ers who’ve milked the boom­ing Al­berta econ­omy for decades. Ex­pect that re­sent­ment to linger.

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