EDMONTON – A torrent of layoffs in Alberta’s energy sector appears to have slowed as 2015 hits the halfway mark but more job losses may be around the corner, an economist warns.
“I think we are probably over the hump of the majority of layoffs but I don’t think it’s quite over yet,” Todd Hirsch, chief economist at ATB Financial, said this week.
“Over the summer months we will see, I think, a few more probably big announcements and some more layoffs in that oil and gas sector.”
Thousands of Albertans lost their jobs in the first six months of 2015. The cuts were deepest in the energy sector, as oil producers, drilling contractors and service companies reacted to the sharp decline in oil prices that started last fall.
Prices for benchmark West Texas Intermediate crude oil fell from $107 US per barrel in June 2014 to less than $50 in January, and dipped below $50 a second time in March. Workforce reductions — sometimes called “organization rightsizing” — have been widespread.
Suncor Energy, one of the first major oil producers to announce cutbacks, said in January it would trim 1,000 people from its staff. As recently as late June, TransCanada Corp. laid off 185 people, most Calgary-based.
But sectors outside energy haven’t been immune. Nearly 2,000 Alberta workers lost their jobs after U.S. retailer Target decided to close all of its Canadian stores.
The job losses don’t tell the whole story, as employment in Alberta actually grew by 38,000 jobs between May 2014 and May 2015, according to Statistics Canada.
But the unemployment rate edged up to 5.8 per cent in May and is expected to creep higher. Hirsch predicts it will average six per cent for the year.
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