The Alberta economy is looking up, according to the chief economist with Alberta Central.
Charles St. Arnaud says the economic outlook is hopeful and cautiously optimistic, especially looking towards the second half of the year.
The first half of 2021 will look similar to 2020, as lockdown procedures only begin to ease in the early months of the year.
“It’s hard to be worse than 2020… As we move on with more vaccinations and more restrictions removed we expect to start to see the economy recover,” St. Arnaud said.
The roll-out of the COVID-19 vaccine will have the greatest effect on the businesses that are client and entertainment-based, St. Arnaud says.
Many client-based businesses such as spas and salons are operating at least 30 per cent below where they normally would be.
And entertainment-based businesses, such as movie theatres and axe throwing, are still closed to the public.
“The more standardized economy issue we are facing right now is ‘When can we reopen? When can we get back to normal?’ It looks like with the vaccine getting out to more and more people we will start to see something looking closer to normal by the end of the year.”
“We believe that we can look positively and cautiously hopeful on 2021,” St. Arnaud said.
St. Arnaud continued, recognizing there are industries that are back to pre-COVID conditions or better, in some limited areas.
He pointed to the resource industry in Alberta as one area that is already seeing a rebound.
“Oil production is already back to pre-pandemic levels,” he said.
While the resource sector is rebounding, St. Arnaud says not to expect another boom in the industry any time soon.
Likewise, he says the continued mass layoffs predicted as an impact of the pandemic on this industry is also not expected.
“Yes the economy was bad last year, and yes 2021 has started the best, but there have been some glimmers of hope.”
Speaking further on the oil and gas industry in Alberta, St. Arnaud says the province will see some impacts of decisions made in the United States.
The cancellation of the XL Pipeline will have impacts on Alberta, namely it will put pressure on investments in the province, says St. Arnaud.
However, he says there are other projects occurring or in the works south of the border which will ultimately help the Alberta resource industry.
“A lot of these impacts coming out of the States will have a more long-term affects and will be felt less now in 2021,” St. Arnaud said.