CALGARY – Finance Minister Joe Oliver’s assertion that there has been no recession in Canada this year is of little solace in Alberta.
“It reminds me of that legend of Nero fiddling while Rome burned,” said Keith Brownsey, a political scientist at Calgary’s Mount Royal University.
“Apparently there’s no recession,” Brownsey scoffed. “You tell that to people in this town right now.”
Oliver made his pronouncement on the recession in an interview with The Associated Press on Wednesday.
“We don’t believe that the economy was in fact in a recession,” he said, despite Statistics Canada data showing two consecutive quarters of negative economic growth this year.
Oliver said the contraction was confined to the energy and resources sector, which makes up about a fifth of Canada’s economy, but that the rest was growing.
Meanwhile, the Conference Board of Canada’s latest Metropolitan Outlook, released Wednesday, paints a bleak picture.
Calgary — the white-collar heart of the oilpatch, which has seen scores of layoffs in recent months — is ranked dead last out of 13 cities when it comes to forecast real GDP growth in 2015. In 2014 it ranked second, after Edmonton.
Alberta as a whole has been hit hard by a halving in crude prices from a year ago, the Conference Board noted. On Wednesday, the U.S. crude benchmark closed well below US$45 a barrel
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“The downturn in the energy sector resulted in very difficult economic conditions in the first half of 2015,” the report said. “Unfortunately, the second half of the year is expected to be equally challenging as more layoffs begin to hit home and builders retreat further from breaking ground on new homes.”
It’s expecting a one per cent contraction in real GDP this year in Alberta, but says next year should be better.
It forecasts a provincial unemployment rate of 5.6 per cent in 2015, worse than the 4.7 per cent rate in 2014.
Todd Hirsch, chief economist at Alberta-owned bank ATB Financial, said earlier this week that he’s predicting a “modest” recession this year, with a return to growth in 2016.
The Canadian Association of Petroleum Producers has estimated 35,000 jobs have been lost in the oilpatch so far this year.
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