Downtown Lethbridge. (Lethbridge News Now)

By David Opinko

Alberta’s economy projected to shrink by 6.8 per cent this year: report

May 28, 2020 | 3:18 PM

LETHBRIDGE, AB – It may not come as a surprise to anyone at this point, but the COVID-19 pandemic will have long-lasting impacts on the Canadian economy.

According to a new report from the Conference Board of Canada, the national real GDP is expected to decline by 4.3 per cent in 2020.

In just the second quarter, the group estimates that the economy will fall by up to 25 per cent.

“From a historical perspective, this is an off-the-charts decline, with the drop nearly three times worse than any other in modern statistics that date back to 1961,” reads the report from the Conference Board.

Unfortunately, they believe Albertans have been and will continue to be hit the hardest of all Canadian jurisdictions.

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While every province has mandated that non-essential businesses close, Alberta will also struggle with continued pressure on the oil and gas sector. The oil price war between Russia and Saudi Arabia has resulted in oil prices crash, at times, to literally nothing.

For the second quarter of this year in the province, unemployment could hit 17.4 per cent.

“Just three months ago, we were projecting 2020 to be the first year of a long-awaited economic recovery in Alberta. Now, the province is eyeing its worst recession on record and a provincial deficit that will be paid off over a period in which the scale is measured in decades instead of years.”

The good news is that the Canadian economy is set for a strong rebound, with forecasted growth in real GDP by six per cent in 2021.

National economic activity. (Conference Board of Canada)

Forecast growth in real GDP. (Conference Board of Canada)

Change in real GDP by province. (Conference Board of Canada)

Forecast recovery for Alberta’s oil and gas sector. (Conference Board of Canada)