Recent Statistics Canada Labour Force Survey data show that B.C. has recouped all of the jobs lost since the economic downturn that began in 2008.
From 2.266 million people employed in the province in 2008, B.C. lost almost 50,000 jobs through 2009; however, by the end of 2011, employment in B.C. had grown back to 2.275 million jobs, or 8,300 more than at its peak in 2008.
Needless to say, this provincewide portrait masks the underlying landscape of regional recovery from what has been called the worst economic downturn since the Great Depression. Of B.C.’s seven development regions, only two saw employment recover back to 2008 levels by 2011.
One region was the Kootenays, where employment grew to be 1% above 2008 levels by 2011.
Unlike other regions in the province, however, employment in the Kootenays reached a peak one year earlier in 2007; 2011 employment in the Kootenays was 6% below the 2007 peak.
Employment in the Mainland/Southwest has also recovered beyond the peak levels experienced in 2008. More specifically, Mainland/Southwest employment grew to 1.42 million jobs by 2011, 3% greater (36,200 more jobs) than in 2008.
Within the Mainland/Southwest region, the Vancouver Census Metropolitan Area (CMA) grew by 4% over the same period, adding 46,800 jobs (with total employment increasing to 1.25 million from 1.21).
With the Vancouver CMA growing more than its parent region, the rest of the Mainland /Southwest (including the Fraser Valley, Sunshine Coast, and Squamish-Lillooet regions) experienced a net loss of 3,100 jobs (a 4% decline) between 2008 and 2011.
That said, the most significant employment loss in B.C. was in the Vancouver Island/Coast region.
From a peak of more than 389,000 jobs in 2008, employment in this region dropped 6% by 2011, a loss of more than 22,000 jobs.
Losses over the same period in the other regions ranged from the 3% declines in North Coast/Nechako and the Cariboo (1,500 and 2,300 fewer jobs, respectively) to the 1% declines in the Northeast (500 fewer jobs) and the Thompson/Okanagan (1,900 jobs lost).
Eventually, employment in all of B.C.’s regions will return to, and exceed, pre-recession levels. However, the timing of each region’s recovery will depend on a number of internal and external factors, including:
•trends in lumber prices and in U.S. residential construction;
•growth in commodity exports to East Asia; and
•the U.S. moving toward energy independence.
With regards to B.C.’s wood-producing regions, while the price of lumber declined steadily between 2004 and 2009 (by 60%), some of the losses have been regained in recent years. The U.S. housing market is now showing signs of life, with the annual number of starts increasing from a low of 554,000 units in 2009 to an estimated 725,000 in 2012.
By 2021 the U.S. population is expected to add the equivalent of a current-day Canada, which translates to a fairly positive outlook for B.C.’s forest industry and hence for regions such as Vancouver Island/Coast, the Cariboo, the Northwest and the Thompson/Okanagan.
East Asia, an expanding export market for B.C., will play an increasingly important role for the province.
For example, from January to September of 2012, 40% of the value of B.C.’s international merchandise exports went to East Asia, second only to the 45% sent to the U.S.
This Asian opportunity is particularly true of our coal-producing regions such as the Kootenays and the northeast, as fully one-third of the value of B.C.’s exports to East Asia this year have been from coal. With the global supply of coal expanding and prices recently falling, it will be important to keep an eye on this sector, most specifically with respect to competition from other coal-producing regions and the impact that could have on energy markets.
Speaking of which, caution may well be the word of the day with respect to the natural gas (and oil) sector, as development of unconventional gas and oil supplies in the U.S. could pave the way for energy independence south of the border. In addition to reducing demand for Canadian energy, the U.S. could become a major exporter of oil, gas and coal and hence B.C.’s biggest, and nearest, competitor.
While recovery has occurred unevenly across B.C.’s regions since 2008, the good news is that rising economic tides in our major export markets – although choppy – will provide the opportunity for most regional economies to float back toward 2008 employment levels over the short-term. The challenge will be for each region to seek out where those opportunities lie and how to capitalize on them. •
