Housing costs are dragging down the economy, B.C. Premier David Eby told delegates of the BC Chamber of Commerce Thursday during a quick rundown of where he sees the state of the provincial economy.
Eby said housing costs are threatening both job creation and sustainability, as businesses continue to struggle replacing retiring workers.
“If they (workers) cannot afford to live in our province because of housing, business can’t be successful and we can’t deliver the services we need to, for people,” said Eby.
It’s why much of his speech was devoted to the provincial legislation the government has introduced that will usurp municipal bylaws by imposing greater housing density allowances, particularly around rapid transit hubs. Eby said economic modelling predicts 250,000 new housing units can be built over the next 10 years, as builders have no restrictions to build up to six units on a detached home lot and apartments near transit.
Eby said immigrants are going to need to fill vacancies, which is why he’s working with professional colleges to streamline accreditation, such as imposing just one English language proficiency test.
Eby maintained his view that higher interest rates are driving up housing unaffordability. Those rates “keep me up at night,” he told delegates, claiming housing projects are being cancelled by developers.
The B.C. government’s latest quarterly economic report shows construction remains robust.
“Home construction in B.C. has been resilient to interest rate increases but has moderated in the third quarter (July to September). So far this year, all major Census Metropolitan Areas (CMA) in B.C. recorded double-digit growth for homes under construction, reflecting the strength observed in B.C. housing starts in previous quarters. However, home completion was mixed during the same period, with a decline in the Vancouver CMA while the Victoria CMA experienced an increase,” the report showed, while also noting that housing starts remain above the 10-year historic average.
A levelling out is expected however: “Residential building permits (a leading indicator of home construction) have slowed in the third quarter, signalling potential moderation in homebuilding activity going forward.”
Housing sector is among many that is impacted by low-carbon policies and regulations under the CleanBC plan.
Eby told the chamber that he was “clearly frustrated” by recent modelling by the Business Council of BC showing the policies would dampen the economy.
“When we can’t agree on the base case model used, that makes things difficult,” the premier said.
“I don’t see CleanBC as a disadvantage; in fact, I see it as an advantage,” said Eby.
While hoping to address his climate change policies the premier also committed to increasing the speed of approvals for natural resource extraction projects and said the government is soliciting investments globally for critical mineral mining.
Eby said GDP growth since 2017, when the BC NDP government took power, is the highest among provinces.
Statistics Canada shows between 2017 and 2022 B.C. had the second highest cumulative (uncompounded) percentage point change, after Prince Edward Island, at 18.1 percentage points. Ontario came in at 12.5 points, Alberta at 8.6 points and Quebec at 13.6 points.
Eby claimed last month B.C. saw the highest growth in private sector jobs.
The fiscal conservative think-tank Fraser Institute’s August 2023 report shows, citing Statistics Canada, that “of the four largest provinces, British Columbia had the fastest rate of public sector job creation (22.6 per cent) and the slowest rate of private sector job creation (0.3 per cent)” since 2020.
Eby clarified at the event he has no plans to schedule an early election, which is otherwise scheduled to take place next fall.