Major projects expected to keep economy buoyant

Kelowna got some bad news earlier this week when a BMO labour market report pegged that city as the worst place in B.C. to find a job.

Economic development officer Colleen Pennington hopes major projects like the hospital will help the economy.

Economic development officer Colleen Pennington hopes major projects like the hospital will help the economy.

A rising tide may float all boats, but the same can be said for a tide moving the opposite way.

Kelowna got some bad news earlier this week when a BMO labour market report pegged that city as the worst place in B.C. to find a job and the second-worst in Canada. Perhaps more startling  was the extent of the plunge, with Kelowna dropping 31 ranks over last year.

Colleen Pennington, Penticton’s economic development officer, admitted that the economy in one Okanagan Valley city has an effect on the others, whether it is a strong performance or a weak one.

“A neighbouring city doing really well is always beneficial to its neighbours because there is always opportunities for more jobs for everyone,” said Pennington, noting that more money in one local economy tends to spread.

“There is a spinoff effect there, both direct and indirect from having employment in a neighbouring community, whether it is Kelowna or Osoyoos. It is to the benefit of everyone if the region does well.”

Pennington said that upcoming major projects will help keep Penticton’s economy buoyant, noting that work is expected to begin this spring on the $300-million expansion of Penticton Regional Hospital, the new casino and a major expansion of the Lakeside resort, and a three-tower residential project in south Penticton.

“In terms of our major projects and the timing of them, it is really nice to have a bit of that buffer that helps us get through, hopefully, the more challenging period,” said Pennington. “We couldn’t have timed our major projects better.”

Pennington added that about 45 per cent of the employment on the hospital expansion is expected to be with local firms and contractors, but the 55 per cent, mostly specialty trades, from out of town will still contribute.

“You still have those people spending money on hospitality and food and supplies.”

Mayor Andrew Jakubeit said there are a few other large developments in the pipeline.

“I think there is a fair bit of construction activity happening, and some investor confidence, which will hopefully translate into more spinoff jobs, and the economy having a bit more confidence, people having a bit more confidence with their money and spending more,” said Jakubeit. “There is growth, but the Okanagan is a tougher nut to crack and we are trying to change that. We are trying to invest in an atmosphere for economic development to happen and be successful.”

BMO’s Labour Market Report Card ranks 33 Canadian cities in terms of how their job market is performing. It attributes these changes in the job market to the weakening of Alberta’s oil sector and the strength of the B.C. economy.

“We’ve witnessed a stark turnaround in migration flows between B.C. and Alberta in response to better relative job prospects,” reads the report.

Both Penticton and Kelowna had been pursuing oil sector workers, encouraging them to take advantage of regular flights to Alberta and make their homes here. Jakubeit said Kelowna’s success in that field may have contributed to their labour market problems.

“I think Kelowna had more people living there and working up north than we did. We are trying to diversify and create an environment where businesses can grow,” said Jakubeit. “It drives home the importance of focusing on building economic development initiatives.”

Pennington said local companies working in the oil sector are feeling the pullback, noting there were major changes between when the start and finish of Penticton’s own labour market survey last fall.

“A lot of what our survey identified in the oil and gas market isn’t actually true right now at this moment, but there are other firms that are doing really well, that have picked up big contracts and are actually scrambling to figure out how they are going to deliver,” said Pennington, adding that the survey still showed an ongoing mismatch between the employers finding people with the skills they need and job seekers finding the jobs they are looking for.

The next step, she said, is a meeting planned for March 18, where the business community will be asked to prioritise the work they want the city to take action on from the labour market study. They will also be presenting information on best practices, sharing the techniques being used to deal with labour market issues, whether it was shortages, retention or finding the right candidate.

“We are pulling together a panel of real business people doing real things around the labour market and they will be presenting at that March 18 meeting,” said Pennington.

Penticton Western News