Regional economic outlook improving
A new report by the Chartered Accountants of B.C. indicates that 2010 marked early signs of economic recovery in the Thompson-Okanagan region.
Overall employment growth helped off-set previous job losses, and pushed down the unemployment rate, particularly among young workers.
Residential building permits increased and both business incorporations and business establishments reported growth.
However, some residual challenges from the economic downturn remain, and for the second consecutive year capital investment declined.
“At this time, economic prospects for 2011 are cautiously optimistic,” said Karen Christiansen, a partner with MNP LLP in Kelowna. “Overall, employment levels are up and unemployment rates are down. Last year, the number of business incorporations and establishments increased, reflecting growing entrepreneurial and investor confidence.
“Price reduction in construction costs will attract greater numbers of second home, resort and investment buyers, which in turn will boost residential, resort/residential and commercial development.”
The report found that after sustaining significant job losses in 2009, the Thompson-Okanagan’s economy rebounded last year with the addition of 9,200 new jobs.
With a job growth rate of 3.7 per cent, the region exceeded the average provincial increase of 1.7 per cent.
The service sector provided the bulk of new employment opportunities with 8,200 jobs, accounting for 89 per cent of the total employment growth.
In 2010, the region’s unemployment rate declined by 0.2 percentage points, to 8.6 per cent, and the youth unemployment rate recorded an impressive 2.5 percentage point decrease, to 10.6 per cent, which was below the provincial average of 11.3 per cent.
The B.C. Check-Up found that 202 new business incorporations were established in 2010, an increase of 8.5 per cent. For the ninth consecutive year corporate bankruptcies declined. The 37.3 per cent drop was the fourth largest in the province.
According to the report, the region enjoyed a 53.6 per cent increase in residential building permits, fueled by lower construction costs, HST avoidance and mortgage rate hike fears.