Premier David Eby has said British Columbia has “the fastest-growing big-province economy” in Canada, but admits: “We understand that that's not enough.”
The BC NDP leader was asked about the state of the BC economy during an interview with NowMedia on Friday.
He said the provincial government is doing the “work” to increase GDP per capita – the size of the economy divided by the number of people living in BC.
“We reduce permit times,” he said. “We're going to keep doing that work. We've dramatically increased investment in our province from the time John Rustad was in government. We're one of just three provinces in Canada that showed positive GDP growth per capita.
“We're the fastest-growing big-province economy, and we understand that that's not enough.”
The key, Eby said, is making people’s lives more affordable. He pointed to child care, car insurance, hydro rates and the carbon tax, which he said last week he wanted to ditch if the federal government makes it possible.
“We're going to make sure that we address affordability for British Columbians while growing our economy, because that's what we've been doing since 2017,” he said.
According to the most recent data, the Canadian economy has seen a decline in GDP per capita in each of the last five quarters.
That suggests that Canadians are becoming poorer even though the country’s overall economy – GDP – has shown growth.
RBC, Canada’s largest bank, said last month that the decline in per-capita GDP was mostly down to “rapid population growth,” with the country welcoming immigrants at a faster rate than the economy is growing.
Statistics Canada highlighted this issue, referred to by some economists as a “population trap,” in a study released earlier this year.
It showed that Canadians are, on average, about $4,200 poorer today than they would have been if the economy had grown according to long-term trends in recent years.
Eby pointed to the federal government's immigration policies while discussing a separate topic with NowMedia on Friday. He said it was a "massive ask" for Ottawa to expect provinces to take in more asylum seekers "as they dramatically increase immigration numbers as part of an economic strategy for Canada."
The premier has also previously spoken of BC's population growth as “not sustainable,” claiming that “our schools are full” and that the numbers of people coming to the province are “completely overwhelming.”
Another StatCan report released in August, meanwhile, found that the average family income in the province declined between 2021 and 2022.
According to the agency, it went from $65,200 in 2021 to $61,720 the following year – a drop of 5.3 per cent.
The picture looked better with the data pulled back a little, however: between 2019 and 2022, the median family after-tax income actually increased by 1.3 per cent, while across Canada it declined by 0.1 per cent.
The economic bête noire for many politicians and businesspeople across Canada over the last two years, however, has been interest rates, and the Bank of Canada’s commitment to keeping them relatively high as it battles against inflation.
Though they have been coming down in recent months, Eby stressed that rates – at over four per cent since December 2022 – have been “devastating for people” in BC.
“I was the first premier to push back on it and say, Have a look at what's driving inflation in British Columbia,” he said. “What's driving inflation in British Columbia is housing prices and, ironically, increasing interest rates drives housing prices higher; people who build rental housing are abandoning projects because the numbers don't work because interest rates are so high on what they have to pay for the financing.
He added: “If you have less rental housing, rents go higher, driving the inflation even higher. One of the biggest categories of inflation for British Columbia were mortgage payments.
“Double-digit increases, month after month after month in BC inflation around mortgage payments. Families saying, Well, we can't afford to go for dinner now. We can't afford to buy stuff from local stores.”
He said he “sincerely” hopes the Bank of Canada’s decision to bring rates down in recent months is “not too late to avoid major economic impacts.”
In his interview with NowMedia, which can be watched in full here, the premier also said there is an opportunity in “population growth and economic growth in smaller communities.”
But he added that some communities have seen “some pretty dramatic growth” and lack the infrastructure to deal with it.
“Kelowna, you know, while not one of those small communities, has seen massive growth that needs to be supported, which is why you see us doing things like opening the urgent primary care centres there in Kelowna, bringing in the CT scan machine at the cancer centre to make sure people don't have to travel for care.”
