KELOWNA, BC--(Marketwired - May 24, 2017) - The CPABC Regional Check-Up, an annual economic report by the Chartered Professional Accountants of British Columbia (CPABC), found that the Thompson-Okanagan Development Region's economic growth slowed in 2016, and prospects for 2017 are uncertain.
"There were a few bright spots for our economy last year. Our population grew modestly by 3,766 residents. The increase was largely due to an influx of people from other provinces like Alberta and Lower Mainland residents cashing out on their properties and relocating to our region. This stimulated a surge in housing sales, new housing starts, and construction employment," said Karen Christiansen, FCPA, FCA, partner at MNP LLP in Kelowna. "In addition, we had another busy year in terms of tourism and agricultural activity, and three of our region's mines reopened."
However, the region's manufacturing, transportation, and trade industries lost approximately 11,500 jobs. The reduction of transportation jobs, particularly in the trucking industry, could be due to a ripple effect related to Alberta's wildfires and economic downturn. Over half of the job cuts in the manufacturing industry were related to wood product manufacturing. This was surprising, given an increase in the region's softwood lumber production in 2016. One possible explanation could be that the manufacturing activity occurred in neighbouring regions like the Kootenays or Cariboo. Another unexpected loss was in retail trade industry jobs, as the region's tourism activity remained busy and there was an overall increase of 6.4 per cent in retail sales across the province.
Overall, the Thompson-Okanagan Development Region lost 1,700 jobs in 2016. As a result, the region's unemployment rate rose to its highest level since 2011. At 7.8 per cent, it is above the provincial average of 6.0 per cent. This, along with 25 reported business bankruptcies in 2016, indicates that the region deteriorated as a place to work and invest. Another bleak point in the Thompson-Okanagan Development Region's economy was a decrease in the value of major capital investment projects. The value of major projects in the region fell by 6.6 per cent to $22.4 billion between September 2015 and September 2016, the lowest level in nine years.
"Prospects for 2017 remain uncertain. A continued low Canadian dollar relative to the American dollar should continue to benefit our region's tourism industry. An expected, albeit slow, recovery in commodity prices and Alberta's economy will also have a positive impact on our economy," continued Christiansen, "However, with the renegotiation of the North American Free Trade Agreement ahead and a potential shift to a protectionist economy south of the border and in other parts of the world, it is unknown whether our economy will grow in 2017."
About CPABC Regional Check-Up - Thompson-Okanagan
The Thompson-Okanagan Development Region comprises five Regional Districts, the Okanagan-Similkameen, Thompson-Nicola, Central Okanagan, North Okanagan, and Columbia-Shuswap, and has the third-highest population after Southwest B.C. and Vancouver Island/Coast.
The CPABC Regional Check-Up reports look at British Columbia's eight Development Regions as a place to work, invest, and live. The reports are available online at: www.bccheckup.com.
About CPA British Columbia
The Chartered Professional Accountants of British Columbia (CPABC) is the training, governing, and regulatory body for almost 35,000 CPA members and 5,000 CPA students and candidates. CPABC carries out its primary mission to protect the public by enforcing the highest professional and ethical standards and contributing to the advancement of public policy. CPAs are recognized internationally for bringing superior financial expertise, strategic thinking, business insight, and leadership to organizations.
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