Alberta’s exit from the recession has been slow and lumpy. A bit of movement forward and then a slide backward now and then. The return to growth has not been led by strong resource sector growth. Low oil prices overall, particularly low bitumen prices along with weak natural gas prices, has made wages, jobs and investment in energy under perform. An average crop year and modest demand for forest products have kept other resource sectors stable.
Government policies on carbon, minimum wages, the pipeline fight, workers compensation and increasing public debt has led to deepening concern in the private sector. For workers, public wage freezes, declining wages in the energy sector and stubbornly high unemployment (7.6% in Calgary) and slowing construction activity, make 2017 pretty forgettable.
But there are more positive economic signals too. Net outmigration to the rest of Canada has slowed and finally reversed. The province’s population grew by over 1%, about the Canadian average. Retail sales were up almost 5% and wholesale trade increased about 10% year over year.
Manufacturing shipments were up 11%. This fall drilling rigs counts were up too; with almost 50% of drilling rigs active. Job growth in manufacturing has been solid, 18,000 new jobs. The resource sectors added 12,000 jobs but are still about 20,000 below the peak of 2014.
Some economists see a different recovery this time, not one driven purely by the energy sector. There is speculation that the energy batch will not recover quickly, and job growth will be constrained.
The future will be different than past economic recoveries. Below are a couple of graphs that show us what job growth in the energy patch might look like.