Alberta is in for a year of growth, but not one residents may be accustomed to.
That was the main message at the Sheraton Hotel Red Deer on Tuesday where the Conference Board of Canada hosted one of its Western Business Outlook Conferences.
Todd Hirsch, Chief Economist with ATB Financial said it’s a fantasy to think five per cent growth year after year is a good thing. The 2.7 per cent projected for 2018 will provide for a much healthier and stable economy, he says.
“Sometimes growth can be too fast, especially when it’s all focused around the energy sector. It’s great for the energy sector when prices are high, but when prices come down, we find there are a lot of imbalances baked into the economy.”
In the name of diversification, Hirsch said it will be key for smaller sectors like agri-foods, tourism and tech to build upon the growth they’ve already started to see.
“Diversity is the elusive word. Every downturn, we’ve tried to ask how can we diversify our economy? It’s not diversity for diversity's sake, it’s diversity so that we don’t constantly go through these booms and busts,” he explained.
Hirsch pointed out that growth from the smaller sectors, particularly in agri-foods where honey and microbreweries have become big in Alberta, has overtaken refined petroleum and chemical production as far as manufacturing is concerned.
"The energy sector is no longer the engine that’s fueling everything. The energy sector is a stable backbone of our economy, still very important, and we can't neglect it. We must move forward on pipelines," he continued.
Red Deer and District Chamber of Commerce CEO Robin Bobocel believes our city is capable of leading the way as the recession is left in the dust.
“We’re a 90 minute drive from 2.9 million Albertans and I think that presents a huge opportunity,” he said. “Leveraging the college and the direction it’s going is another opportunity. This community is very innovative and nimble and not afraid to take risks.”
Bobocel added Red Deer is at an advantage because it’s typically the first in and first out of a recession.
“We’re the first hit when the economy turns bad because of the make-up of our business community being more of a support to oil & gas and other industries,” he said. “But we also emerge out of the recession first because we have an opportunity to observe how other jurisdictions react and re-tool and plan for future growth.”
“We are optimistic, we should be optimistic. We’ve got a lot going for us,” Bobocel concluded.
Meanwhile, Hirsch believes Albertans could help things along simply by changing their attitudes.
“We need to re-orient our frame of mind and attitude -- not that everything is great in Alberta right now, but we’re not in a recession anymore,” he said. “We have to, in some sense, stop talking about living in recession and orient our language and frame of mind around growth.”
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