Photo: The Canadian Press
Thousands of jobs disappeared, more people were unemployed, there was less capital investment and dozens of businesses went bankrupt in the Thompson-Okanagan in 2016.
The deluge of bleak news overshadowed the few bright spots in the region’s economy last year, causing an overall downturn in the region’s economic growth.
And 2017 might not be any better.
The Chartered Professional Accountants of British Columbia released their regional check-up today, and the indicators don’t tell an encouraging story for the Thompson-Okanagan.
While an influx from Alberta and the lower mainland buoyed the population by 3,766, spurring a surge of new housing sales, starts and construction, big hits to the region’s manufacturing, transportation, and trade industries meant overall job losses.
In total, the Thompson-Okanagan Development Region lost 1,700 jobs in 2016, but the region’s manufacturing, transportation, and trade industries industries saw approximately 11,500 jobs disappear.
Somewhat puzzling was the fact that half of the 11,500 jobs lost in those industries were in wood product manufacturing. Considering the region’s softwood lumber production increased in 2016, a possible explanation could be that the manufacturing activity occurred in neighbouring regions like the Kootenays or Cariboo.
According to Karen Christiansen, a partner at Kelowna’s MNP LLP, dwindling transportation jobs, particularly in the trucking industry, could be due to the ripple effects from the wildfires and economic struggles in Alberta.
Another unexpected loss were retail jobs, which went down despite the fact that the region’s tourism activity remained busy and there was an overall increase of 6.4 per cent in retail sales across the province.
As a result of all the lost jobs, the region’s unemployment rate rose to its highest level since 2011. In 2016, 7.8 per cent of people in the Thompson-Okanagan didn’t have a job, a significant spike from the provincial average of 6 per cent.
In addition, 25 business in the region reported bankruptcies in 2016, something that Christiansen says indicates the region has “deteriorated as a place to work and invest.”
That deterioration played out in the amount of money spent on major capital investments in the region in 2016. The value of major projects in the region fell by 6.6 per cent, to $22.4 billion, between September 2015 and September 2016, its lowest level in nine years.
And while 2016 was not a good one for the Thompson-Okanagan Development Region, there’s no guarantee 2017 will be any better.
Christiansen said the low Canadian dollar relative to the American dollar should continue to benefit the tourism industry, and the slow recovery in commodity prices and Alberta’s economy will also have a positive impact.
“However, prospects for 2017 remain uncertain,” she said. “With the renegotiation of the North American Free Trade Agreement ahead and a potential shift to a protectionist economy south of the border and in other parts of the world, it is unknown whether our economy will grow in 2017.”
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