Unemployment rate in Greater Victoria hits record high
VICTORIA -- Southern Vancouver Island is now experiencing it's highest unemployment rate ever recorded.
The latest economic statistics from the South Island Prosperity Partnership show an unemployment rate of 10.1 percent -- the highest in our region's history. For context, the region's unemployment rate peaked at 7.4 percent as a result of the 2008 financial crisis, and the following recession.
The unprecedented statistics have been brought on by the COVID-19 pandemic, which caused the local economy to come to a complete halt back in March. Many of the businesses which closed during the early stages of the pandemic have yet to return to business, while others have struggled to adapt to the province's new health guidelines for operations.
SIPP Director of Economic Development Dallas Gislason says the region's tourism sector continues to be the worst hit, and that domestic travel won't be enough to alleviate the problems.
"It's a question of if businesses have the right volumes to stay open and operate at a loss," said Gislason. "I don't think domestic travel is enough to do that."
Another significant blow to the southern island economy comes as the amount of building permits approved in the region has also seen a sharp decline since the pandemic began. The SIPP report shows that a "ripple-effect" of a construction slow-down will be felt as this sector employs more than 15,000 of the region's 200,000 person workforce.
SIPP Director Gislason says that despite construction starts being down across the region, the West Shore has had slightly better fortunes than the City of Victoria.
"It's easy to assume that the West Shore communities will fair better on the construction side," said Gislason. "A green field development is much easier to approve than a brown field development, so if you're just looking at vacant land the process is much simpler than it is downtown."
Despite southern Vancouver Island being home to the country's lowest unemployment rate back in February, four months of pandemic restrictions have rocketed the region's jobless rate from 4.6 percent in March, to 10.1 percent in June.
The South Island Prosperity Partnership report indicates that the unemployment rate is expected soften downwards when the next report is issued, though Destination Greater Victoria estimates that the long-term impacts on our region over the next 10-14 months could exceed $1.4 billion dollars.
Gislason says while he does anticipate the unemployment rate to decline before the end of summer, a number of challenges still lie ahead.
"It's going to be difficult because of the tourism industry and the impact that it has," said the SIPP's Director of Economic Development. "There's a ripple effect across retail, restaurants, and other businesses that would normally be dealing with higher volumes in the summer."
On a positive note, the report does show BC Transit ridership is starting to improve again. Though the May and June data will not be available until next week, anecdotally, BC Transit has reported improvements. This means more people are getting back to work and taking transit for shopping and other outings, which are noted signals of positive economic churn.