3 minute read
The COVID-19 pandemic has significantly impacted Alberta’s previously weakened economy. The closure of non-essential businesses, travel restrictions, physical distancing measures, and the latest crash in oil prices has negatively impacted businesses and contributed to a surge in unemployment. In May 2020, Alberta's unemployment rate rose to 15.5 percent, up from 6.7 percent in May 2019. At the same time, Canada's unemployment rate was 13.7 percent, up from 5.4 percent in May 2019. According to ATB Economics, almost no sector of Alberta’s economy was left unscathed. Such a rapid increase in unemployment adds to the economic insecurity many households in Alberta are already facing. Further, the unemployment rate in the province is expected to be one of the highest in the country next year.
According to ATB Economics, almost no sector of Alberta’s economy was left unscathed. Such a rapid increase in unemployment adds to the economic insecurity many households in Alberta are already facing.
Though the pandemic has exacerbated social distress in Alberta, the fall of oil prices in 2014 and the ensuing recession kickstarted the deterioration of Albertans' social well-being over the last six years. Since 2014, the economic trajectory of Alberta has been stark, and the correlating distress, as captured by data from social conditions for the 2014 to 2019 period, exemplify why significant jobs lost, bears more weight than we may realize:
- The number of unemployed individuals not covered by employment insurance has risen 53 percent;
- Unemployment among young men is up 156 percent;
- Food bank usage is up 80 percent;
- Suicide hotline calls have increased by 85 percent;
- The number of individuals seeking counselling support in Calgary has increased 46 percent;
- The percentage of Alberta households relying on social assistance has nearly doubled;
- Incidents of domestic violence in Calgary have increased by 150 percent;
- Non-violent crime is up 34 percent;
- Business insolvencies have increased by 58 percent; and,
- Consumer bankruptcies are up 101 percent.
It's common to conceptualize a business' contribution to society through economic factors such as the unemployment rate or GDP growth rate, however, it’s evident that the impact extends far beyond such quantitative factors. As exemplified by the data, the worsening of Alberta's economy and the loss of approximately 100,000 jobs in the energy sector, has had effects on the social well-being, and ultimately, the quality of life for Albertans. The rise in suicide hotline calls, incidents of domestic violence, and the number of individuals seeking counselling, exemplifies the dire and long-term consequences that accompany economic hardship. In turn, the healthcare system, the non-profit sector, and government agencies are strained by such increased social distress.
Though less visible than empty corporate offices, these longer-term, and often less cited aspects of economic hardship on individuals and their families, compound over time.
Though less visible than empty corporate offices, these longer-term, and often less cited aspects of economic hardship on individuals and their families, compound over time. Such consequences are not always resolved when the economy recovers, and “jobs come back.” As a result, it's imperative that we acknowledge the deeper and more meaningful cost of the approximately 100,000 lost jobs in Alberta, as it's not only about income loss for corporations and individuals. The reality is that the hardship – which permeates the lives and homes of Albertans following the sudden loss of employment – may be everlasting.
ENJOYED THIS ARTICLE?
Read more insights like this by signing up for Sagacious, our free weekly business news and research newsletter.
Get our insights sent straight to your inbox, every Friday.
No exceptions, No Catch.
This work has been funded by Viewpoint Foundation.Sources cited:
ABOUT THE AUTHOR
Flutra Kacuri is an incoming second-year law student at the University of Calgary, Faculty of Law and a summer research associate at Viewpoint Research. Her research focuses on ESG, energy governance, and policy.