Amid an unemployment rate above eight per cent, the Alberta government will provide an update on the number of people finding work because of its job plan.
The government says it is on pace to spend a record amount on infrastructure this year as 367 major capital projects were underway at the end of August.
“We need to recognize Albertans are experiencing a very, very challenging time with the low price of oil,” said Deron Bilous, minister of economic development and trade. “Especially in Calgary, they’ve been hit fairly hard, which points to exactly the reason this ministry was created a little over a year ago to put a spotlight on the economy.”
‘Alberta’s economy as a whole is not as weak as, I think, people suppose it is’ – Trevor Tombe, University of Calgary economics professor
The jobless rate in Calgary rose to 10.2 per cent in October, while Edmonton’s rate fell to 6.9 per cent.
Bilous has rolled out a wide range of programs and incentives since the spring budget six months ago such as the small brewers development program and the petrochemicals diversification program. New infrastructure projects added in the last year are estimated to create 10,000 jobs a year over the next three years.
“The numbers are positive whenever we see more Albertans getting back to work, but recognize that this is still a very challenging time,” said Bilous.
Some highlights from the jobs plan update:
- Capital investment in manufacturing and service sectors is expected to reach a record high of just over $21 billion this year
- Government infrastructure spending to reach a record high this year of $11 billion
- Non-oil and gas investment (both private and public) to reach a record high of $38 billion this year
- About 2,700 student jobs supported this past summer with the reinstated summer temporary employment program
Too early to judge
The Alberta government’s job estimates are realistic, said Trevor Tombe, an assistant professor of economics at the University of Calgary, after looking over an advanced copy of the government’s report to be released Monday. Although he cautions it’s too difficult to evaluate the government on its job creation programs right now.
“A lot of the larger scale infrastructure projects that the government has announced, like the cancer centre in Calgary, the ring road, things like that, haven’t got off the ground just yet,” said Tombe. “It’s far too early to see any kind of government programs have an effect on the economy as a whole.”
University of Calgary Economics Professor Trevor Tombe says its too early to evaluate the effectiveness of the Alberta government’s job plan. (Erin Collins/CBC)
He also suggests government spending may improve the economy, but it won’t save the day because there so many other impacts such as the value of the Canadian dollar and commodity prices.
The oil and gas industry is expected to invest $28 billion dollars this year in Alberta, less than half of the $61 billion spent in 2014.
“Investment has gone down, but it’s still at a very high level,” said Tombe. “Alberta’s economy as a whole is not as weak as, I think, people suppose it is.”
New tax credits
The government plans to roll out a pair of incentives soon to attract investment in Alberta companies through an investor tax credit and promote spending on new equipment and machinery through a capital investment tax credit.
Infrastructure spending remains the key part of the jobs plan, which some argue should be the priority.
“The best way for federal, provincial, and municipal governments to put people back to work in this province is through the investment in infrastructure that aligns with strategies to diversify the economy and build strong communities,” said Mary Moran with Calgary Economic Development. “Given the type of skilled workers now looking for jobs, this investment is critical for both the short and long-term impacts.”