(Reg Warkentin – Policy and Advocacy Manager for the Red Deer and District Chamber of Commerce)

By Sheldon Spackman

The Alberta Government released it’s Second Quarter Fiscal Update and Economic Statement on November 28th and it shows that despite ongoing challenges and high unemployment, there are some hopeful signs for the province’s economy.

Provincial officials say there were 25,000 jobs added in the last three months, manufacturing shipments have increased in recent months, the value of Alberta’s exports has increased since April and drilling activity is picking up from its lows.

Following two years of contraction, Alberta’s economy is also expected to grow by 2.3 per cent in 2017, supported by wildfire reconstruction, a rebound in oil production, additional investments in public-sector infrastructure and a modest improvement in oil prices.

However, Red Deer and District Chamber of Commerce Policy and Advocacy Manager Reg Warkentin says there’s still cause for concern when looking at the size of the deficit and debt. The 2016-17 deficit is forecast to be $10.8 billion, a $78-million decrease since the first quarter but still $449 million higher than estimated at budget, due to the impact of the Wood Buffalo wildfire and other factors.

Warkentin says “It’s good to see some progress being made despite the high cost of the Wildfire in the spring but the debt and deficit maintenance levels remain cause for concern.” He feels that “Some further efficiencies can still be found in the way the government delivers it’s services without major service cuts.” Having said that, Warkentin was surprised to see non-renewable resource revenue increase, adding that “It’s a broad sign of the economy being on the right track, especially in the oil and gas sector.”

The government is maintaining it’s forecast for oil prices at $45 US/Barrel, the same as at first quarter but three dollars higher than estimated at budget. Forecast revenue is up $1.3 billion from Budget 2016, primarily due to the increased non-renewable resource revenue, federal transfers and investment income.

Operating expenses though have increased by $556 million from budget. This includes a second quarter increase of $100 million to address higher caseloads for Income Support, Assured Income for the Severely Handicapped and other support programs.

In a release, President of Treasury Board and Minister of Finance Joe Ceci, says  “While it’s too soon to say Alberta’s economy turned a corner, there are some hopeful signs that it’s stabilizing. We are keeping a steady hand on the tiller and sticking to our approach of controlling spending, protecting critical public services and supporting job growth and the diversification of our economy.”

You can watch the Announcement here:

https://www.youtube.com/watch?v=ZF1okvLkQZA&feature=youtu.be

(Photo courtesy of the Red Deer and District Chamber of Commerce)