Susan Mowbray, senior economist and partner at MNP, presents the State of the Island economic report on Wednesday night at the Vancouver Island Economic Summit at Nanaimo’s Vancouver Island Conference Centre. (GREG SAKAKI/The News Bulletin)

Vancouver Island’s diversified economy expected to slow but not stall

Senior economist delivers State of the Island report at summit in Nanaimo, says ‘don’t panic’

No economy is recession-proof, but Vancouver Island is diversifying and becoming better-equipped to be able to stave off any slowdowns, says a senior economist.

The annual State of the Island economic report was released Wednesday at the Vancouver Island Economic Summit in Nanaimo. Susan Mowbray, partner at MNP, presented the report to delegates at the Vancouver Island Conference Centre and her advice was not to panic.

“Growth is expected to slow, there’s no question about that, but there’s no indication it’s going to stall yet,” she said. “And that is because of that diversification.”

Mowbray said because Vancouver Island has “a small, open economy” that isn’t independent, outside factors do have an effect. The pace of growth or lack of growth on the Island might depend on a range of influences, she suggested, such as global tensions and trade uncertainties, large-scale infrastructure projects elsewhere in B.C., and contraction of the forest industry.

The economic report notes that on Vancouver Island, population and employment growth contributed to overall growth, “albeit at a more moderate pace than in 2017.” Mowbray said growth in 2019 is going to be lower than 2018, and 2020 will be lower still, some of the reasons being slowdowns in housing and construction “and just a general malaise in the economy” brought on by global factors.

Vancouver Island’s unemployment rate is not only the lowest in B.C., but the lowest in Canada, Mowbray said, and the Island and the Lower Mainland are experiencing “very acute” effects of a tight labour market.

“It’s made it really difficult for employers to be attracting and retaining the workers that they need,” she said.

RELATED: B.C. Premier talks pipeline, Western separatism at economic summit

The report found that the Island’s tourism industry continued to perform well in 2018, especially considering a “relatively unfavourable [currency] exchange rate,” Mowbray said.

Conversely, the forestry industry had a “difficult year” in 2018, the report showed, and challenges have continued or worsened in 2019. Mowbray pointed to a lack of available trees, the absence of a softwood agreement, Teal-Jones Group ceasing harvest activity and the Western Forest Products labour dispute as some of the long- and short-term factors. A drop in production combined with mill closures and curtailments have resulted in a decline in shipments of forest-related products.

“There’s still going to be a forest industry on Vancouver Island – it’s just going to be a lot smaller,” Mowbray said. “Now, if I’d said that 13 years ago at the first summit, it would have been cause for significant concern, and don’t get me wrong, it’s still certainly a cause for concern.”

However, she noted that although there are more than 2,000 fewer forest-industry jobs on the Island since 2015, that same time period has seen the creation of more than 40,000 overall jobs. Film and TV, technology, craft brewing and cannabis, for example, aren’t large industries on the Island, relatively, said Mowbray, but “collectively they make a big difference and they do matter.”

It’s part of a shift toward a Vancouver Island economy that’s less dependent on any one industry, she said.

“By diversifying, Vancouver Island’s economy is becoming less dependent on cyclical swings in individual markets – such as what’s happening with forestry – and more resilient,” Mowbray said. “I’m not going to say recession-proof because no economy’s recession-proof, but more able to weather the storms.”

The 2019 State of the Island economic report was prepared by MNP for the Vancouver Island Economic Alliance. Pete van Dongen, MNP’s marketing manager for the Island, said the report has become a model for other regions to follow. He talked about how Vancouver Island has changed and grown since the first economic summit in 2007.

“I can’t help but think how our discussions today and tomorrow and the relationships that we build and the actions that follow from this event will change the course of our businesses, our communities and our Island as we look years into the future,” he said.



editor@nanaimobulletin.com

Like us on Facebook and follow us on Twitter

Get local stories you won't find anywhere else right to your inbox.
Sign up here

Just Posted

UPDATED: Young deckhands backed out of fatal Arctic Fox II trip just before fishboat departed

Inexperienced twin brothers had ‘gut feeling’ and bailed before going to open ocean

Cowichan’s Dillabaugh checks in from the NHL bubble in Toronto

Flyers’ Duncan-born goalie coach weighs in on hockey restart

37-year-old man missing from Cobble Hill area

He is described as a First Nations man, 5 foot 8 in height

Five new handyDART buses serving Cowichan

Buses to replace older vehicles being removed from the fleet

Starvation claims Great Blue Heron in Crofton

No other contributing factors found in death during a necropsy

B.C. records new COVID-19 death, 85 more cases; Horgan calls on celebrity help

This brings the total number of active confirmed cases to 531 across the province

Horvat scores 2 as Vancouver Canucks beat Blues 5-2 in NHL playoff opener

Game 2 in best-of-seven series goes Friday night

Old-growth forest defenders in Campbell River call for B.C. forest minister’s resignation

Protestors outside North Island MLA’s office ask government to stop old-growth logging

Teachers to get 2 extra days to prepare for students’ return, now set for Sept. 10

Students will first start with orientation and learn rules of COVID-19 classroom policies

High-volume littering at Cape Scott draws ire from hiking groups

Popular Vancouver Island hiking spot not closing, but frustration about crowding grows

SFU to drop ‘Clan’ varsity team name

The ‘Clan’ name is shortened from ‘Clansmen,’ and was introduced roughly 55 years ago

New Tory leader must build a strong team in Commons and for the campaign: Scheer

Scheer marked his final day in the House of Commons today as leader of the Opposition

B.C. to hire 500 more COVID-19 contact tracers ahead of fall

Contract tracers add an ‘extra layer’ in the fight against the novel coronavirus

More than $800,000 in suspected cocaine seized from ship near Victoria

RCMP Dive Team suspects more narcotics had been stored below ship’s waterline

Most Read