How are we feeling the pinch?
Calgary is well-known as a one horse town economically. That horse is oil and forces outside of our control means that horse isn’t as healthy as it once was. This isn’t new or surprising. Oil has always been boom and bust, and everyone in the industry knows that whither goes oil, so goes the health of the city.
Knowing and experiencing though, are two different beasts. While most oil companies are aware that they should save for the rainy days, oil operations are capital intensive, most companies ride in the red and the industry has a reputation for spending in the good times like drunken sailors on leave.
The perks doled out to attract employees to oil companies were both astronomical and legendary. Alberta’s population filled to the brim with economic migrants looking to cash in. Money was borrowed and spent with abandon. Some were smart and invested their windfall, others were determined to ride the gravy train to their eventual destruction.
Now, the gravy train is looking more like it’s carrying a dose of smelling salts, bringing us back to reality.
Alberta as a whole has lost 35,000 good paying oil industry jobs since the downturn began. Companies are shedding workers in all sectors, from rig hands to oil executives. The unemployment rate rose from nearly nothing to 7 percent. Youth unemployment is at a pinching 11.2 percent. Unemployment insurance recipients rose 9 percent.
These stats are depressing to say the least, but is it necessarily all bad?
Space for Rent!
Little companies take heart! The potential for start up culture to flourish is growing. Oil industry investment in offices around Calgary means that there’s a surplus in office space to be found. Smaller companies could have the opportunity to scoop up some lease deals on great office and commercial spaces all around the city.
I can hear you saying that without oil industries demanding services, what are start ups supposed to do? Internet! That’s right – online tools mean you can offer services an-y-where. And I might just know a great company that can get you set up there (wink wink).
What next? Check back soon!