New Brunswick’s economy could experience its fair share of “doom and gloom” in 2023, according to the Vaughan Chair in Regional Economics at the University of New Brunswick.
Speaking with Global News on Tuesday, Herb Emery stated that in 2022, consumers managed to stay afloat despite signs of strain.
“The shoe’s going to drop, and people are basically going to run out of runway to stay afloat,” Emery said.
Elevated price pressures, only exacerbated by the conflict between Ukraine and Russia, have shown little sign of relief.
In November, the consumer price index for New Brunswick reached 7.8 per cent compared with the same period a year prior.
In an attempt to cool off the record levels of inflation, the Bank of Canada has come out with a series of interest rate hikes in recent months.
While many provinces will feel these impacts, Emery expects New Brunswick will see a different outcome.
“In New Brunswick, what you might see is population migrates away or doesn’t come, so we may not see lots of movement in either employment or unemployment, but you’ll see that growth that everyone’s been talking about suddenly stop.”
As a result, there could be a loss of small businesses that can no longer keep up with labour shortages.
“It’s doom and gloom for everywhere except Moncton and Fredericton,” Emery said.
“Moncton and Fredericton have their own dynamic going on, Fredericton through government spending, Moncton through government spending and just a lot of population in-migration because it’s a city and it’s growing.”
The start of the new year is also a reminder the clock continues to tick on issues that have in past been pushed to the back burner.
Over the last year, the province has been flooded with stories of trouble in the health-care system. Global News has reported on deaths in emergency rooms, significant loss of staff and losses in service.
At the same time, the province has an aging demographic, which leaves uncertainty about how long the system can endure mounting pressure.
“In a sense, it’s a bit like the climate crisis, because from one year to the next, the changes aren’t that big, but they do accumulate over time,” said Lars Osberg, a professor of economics at Dalhousie University.
Data released by Statistics Canada last April indicated the proportion of New Brunswick’s population aged 65 years and older was 22.8 per cent in 2021. Only Newfoundland and Labrador ranked higher.
Osberg added there’s no way to avoid it, more funding will be needed in the near future.
When asked about the outlook for 2023, Osberg stopped short of predicting a recession, but said he believes there will be a slowdown in economic activity and an increase in unemployment.
“If the economy of the country as a whole goes into a recession, there’s really no way Atlantic Canada can avoid the impacts of that decline,” Osberg said.