In a year where no province was spared a devastating economic blow from the COVID-19 pandemic, Alberta was by far the hardest hit.
Numbers released this week by Statistics Canada show Alberta’s GDP shrank 8.2 per cent in 2020. The next hardest hit were Quebec and Newfoundland and Labrador, with economic retreats of 5.3 percent. Canada’s economy as a whole shrank 5.3 percent.
“This is definitely an unprecedented event in at least the last four decades,” said ATB Financial deputy chief economist Rob Roach.
Alberta’s economy was hit harder because it didn’t only deal with pandemic restrictions, but also a collapse in world oil prices last spring.
On April 20, 2020, the benchmark price for West Texas Intermediate crude closed below zero for the first time ever, leading to large amounts of production being shut in, and a wave of job losses.
In total, oil and gas extraction fell 6.4 per cent in 2020.
Prices have since rebounded, and employment in the sector has returned to pre-pandemic levels, but Alberta is still struggling through a jobs crisis. The unemployment rate in the province stands at 9.1 per cent and 223,000 Albertans are looking for work.
ATB Financial is forecasting the economy to bounce back 4.1 per cent this year, but it will be a long road back to normal.
“It will probably take until about 2023 before we fill the hole that was created by the losses in 2020,” Roach said.
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That growth is, of course, not guaranteed. Roach says world oil markets need to remain stable, and the province needs to get through the pandemic. Alberta currently leads the nation in per capita active cases of COVID-19.
“The path of the pandemic, to be able to fully get it behind us and reopen the economy, even if things aren’t exactly like they were, some sense of normalcy is important,” Roach said.