Calgary Economic Development delivered its annual economic outlook on Tuesday.
Economists with ATB and the Conference Board of Canada (CBOC), speaking to industry and business leaders, said the Alberta economy is close to, or has hit rock bottom.
They predicted the economy will start to recover in 2017.
The CBOC said it expects the unemployment rate in Calgary will improve to 7.8 per cent from the double digits we’re currently seeing.
“I really don’t see the unemployment rate rising a lot higher, and if there is a flattening of investment in both the energy patch and other parts of the economy, that will form a floor, and you can start adding jobs from that.” The Conference Board of Canada’s Greg Hodgson said.
Hodgson is also warning Albertans to be prepared for a slower rate of growth. He said we will likely see growth closer to 2 per cent, rather than the 4 per cent Albertans were used to before the economic slump.
ATB Financial’s Todd Hirsch said he expects the oil and gas industry to slowly bounce back after hitting bottom. Though he warns there could be more job losses to come.
“We think we’ve seen the worst in the oil price downturn, but we don’t think we’ve seen the worst in the labour market. There is going to be a lag in the labour market improving coming out of this recession, and as a result I think Albertans need to brace themselves for still some tough months ahead In the labour market,” he said.
Hirsch said it’s not clear what impact the U.S. election will have on the Alberta economy, but that the approval of a new pipeline should help buoy the economy.
“That changes things in Alberta. I think that would brighten the mood.”
“If there’s absolutely no movement on any pipeline at all, I think that obviously darkens the mood and it puts Alberta in a different spot and that’s why, as we’ve been saying all along, there’s fewer issues more important than transportation and access to tidewater for our petroleum products,” Hirsch said.
Mary Moran, head of Calgary Economic Development, adds there are other paths to recovery for city’s like Calgary. There are 300 companies involved in renewables and energy storage in the city, she explained.
She said the downturn has also given companies an opportunity to look at Calgary for its cheaper office rates and available labour market.
With files from Aurelio Perri