Albertans see wage increase; economist considers it encouraging sign

The take-home pay of employed Albertans rose in May by 1.9 per cent. It marks what City of Edmonton chief economist John Rose considers another encouraging sign the region is now on the rebound after a recession.

Considering the numbers from Statistics Canada on the average weekly earnings, alongside improvements in employment, retail sales, wholesale activity and housing starts, Rose is cautiously optimistic.

“It’s always best to be a little bit wary,” he said. “If oil prices again turn back down and windup down in the low 40s, we could see another pullback in energy-related investment and activities.

“But barring that right now, the indicators are very clear, both at the provincial level and at the City of Edmonton, that the economy is picking up.

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“It’s particularly important for wages to go up obviously to support consumer activity and to encourage people to make those big-ticket purchases — whether it’s a house or a car — which drives the consumer side of the economy.”

This increase is the first the region has seen in a long time.

READ MORE: Edmonton economy takes a hit in third quarter of 2016 

“We saw wages and salaries uptick a little bit back in late 2016,” Rose said. “But then they slid right back down again. But this time around, it’s beginning to look like we’ve got a solid turn around there.”

Rose also said it takes larger dollar amounts to have an impact in Alberta.

READ MORE: Canada’s highest (and lowest) paid regions, by average hourly full-time wage 

The numbers also indicate Alberta’s May average weekly earnings of $1,119 was well ahead of the next highest province, Newfoundland and Labrador, at $1,034.

“We’re still about 15 per cent above the national average,” Rose said. “That’s driven basically by the fact that while the average weekly wage in Alberta is around a little over $1,100 a week, in the energy sector it’s almost $2,200 a week — almost twice as much. So, those salaries in the energy sector really distort the entire spectrum of wages and salaries in Alberta.”

While the year-over-year numbers show an increase, they’re still ever so slightly down over the first five months of 2017, dropping 0.2 per cent.

The average for January to May dropped from $1,122 to $1,120.