Douglas Todd: Seven of 10 B.C. residents think Premier David Eby has done a “poor job” of protecting their standard of living. Some money trends, not all, put the NDP at risk.
B.C.’s NDP government is vulnerable on money issues.
The Angus Reid Institute found this month seven of 10 British Columbians think Premier David Eby has done a “poor job” of protecting their standard of living.
In the campaign flurry leading up to the Oct. 19 election, the NDP are putting forward an economic platform that boasts of the province’s “fastest growing economy” and solid job creation.
The NDP promises to share wealth, while accusing the Conservatives of wanting only to “make the economy work for the top two per cent.” Its platform highlights how it has mandated higher minimum wages and paid sick leave.
Meanwhile, Rustad laments an outflow of discouraged British Columbians who moved to other provinces last year. He has highlighted the Angus Reid poll showing fully one third of residents are “seriously” considering leaving because of unaffordability.
The Conservative leader promises to hike economic productivity, approve more LNG projects, bring in tax cuts, including on carbon emissions, and reduce public spending — but not on health care.
Here’s a look at some of the province’s ups and downs. Background and perspective are provided by the Business Council of B.C., which represents 200 companies, post-secondary institutions and industry associations.
Wages stagnant
While B.C.’s overall economy has expanded because of record population growth from international migration, most economists say the best way to measure living standards is through gross domestic product per capita.
In that regard, GDP growth per person has averaged a half per cent per year between 2018 and 2023.
This is “relatively good” compared to the rest of Canada, the BCBC said this month in an advisory.
The trouble is the rest of the country is not doing well at all. Canada has been the second worst performer of the 38 nations of the OECD, a club of advanced economies.
B.C.’s per capita growth rate is only half the province’s historical average, said the BCBC, which estimates most of its growth has been based on big capital projects like the Trans Mountain pipeline, Site C dam and the LNG Canada and Coastal Gas Link projects. All of which are complete.
More jobs created in public than private sector
B.C. is doing worse than most other provinces in regard to creating jobs in the private sector, say BCBC officials Jock Finlayson and Ken Peacock.
In the past five years, they point out, almost all job creation has occurred in the public sector, mainly in education, health and public education.
“Since 2019 there have been five public sector jobs created for every new private sector job.”
Wealth being redistributed
The gap between rich and poor has been gradually narrowing in the province, as it has across the country
“Income inequality in B.C. rose in the 1980s and 1990s and peaked in 2002. Income inequality has been falling for the past two decades,” says Williams, who is also president of the association of professional economists of B.C.
However, Williams notes the somewhat better equality ranking is only true of incomes. It’s not the case in regard to the wealth B.C. residents hold in investments and especially housing, which is unaffordable for many.
Costs, and taxes, up sharply
It costs 21 per cent more to live in B.C. than it did in January 2019, says Williams.
While this inflationary increase is in line with other provinces, the consumer price index shows the greatest jumps in B.C. in the past five years have been in the two largest categories: food (up 27 per cent) and housing (29 per cent).
Rental costs have soared “at the fastest pace of rental inflation in 41 years,” says Williams. “It follows the federal government’s decision to ramp up the level of immigration to around 1.3 million per annum, which is roughly five times the 2010-15 average level.”
Meanwhile, B.C. homeowners have experienced “spectacular” increases since 2019 in home and mortgage-insurance costs (49 per cent) and property taxes (33 per cent), Williams says. The price of utilities has been mixed, with vehicle and other fuel oil inflating by 51 per cent, but electricity only going up nine per cent.
Outflow to other provinces
While B.C.’s total population growth is extremely high, at over three per cent in 2023, it’s been almost entirely because of international migration.
Government borrowing ballooning
The B.C. government’s 2024 budget deficit of $7.9 billion is the largest in the province’s history.
“As recently as 2021 B.C. had one of the best fiscal settings of any province, with a long track record of balanced budgets or small operating deficits,” says BCBC. “Today B.C. is running the largest deficit in the country relative to the size of its economy.”
Whichever party forms government, Williams recommends it return to a balanced budget within three years. That, he said, would help put the brakes on inflation, tax levels, the government’s payments on borrowing and most everyone’s cost of living.