There’s no way to sugar-coat it: the COVID-19 pandemic is certain to be the world’s single worst downturn in modern history. For Alberta, it will be doubly bad because A) it’s hitting the energy sector extremely hard, and B) we’re going into the downturn with an economy that’s already severely compromised.
The reality is that in terms of the contraction in the size of the economy, Alberta is likely to see the worst year since the Great Depression of the 1930s. The unemployment rate could hit 20% or higher. All of that draws to mind the images from the Depression of people going hungry, living in dusty shacks, and wearing dirty and tattered clothes.
As bad as the economy is about to tank, we don’t need to worry about those images becoming reality in 2020. There are three reasons why.
All of this may be cold comfort for Albertans who are facing joblessness and worrying prospects today. They wonder when — or if — their job will ever return. It will be painful, there is no doubt. And while comparisons to the 1930s may be correct with respect to the size of the economic contraction, we need not fear the levels of poverty and destitution that marked The Great Depression.