At the height of the Great Depression almost 80 years ago, unemployment was more than 20 per cent in Canada compared to the six to eight per cent we’ve seen in recent years. While that means 80 per cent of people were still employed or earning some sort of a paycheque, a return to those past employment figures would triple the number of people on our employments rolls. If there are 18 million workers in Canada today, a 15 per cent drop in employment would represent about 2.7 million people, or more than four times the population of the City of Vancouver.
While the recent financial crisis has been compared to the Great Depression, some experts are skeptical. People will lose money and jobs, certainly, and it could take a decade for people to recoup the money they’ve invested, but it’s a different world. Our savings are insured, up to a point, and we have the Bank of Canada lowering interest rates to ensure that people who need loans and mortgages can still get them. Savings are safe, and credit is out there.
Our biggest problem is confidence. Right now people are afraid for their jobs, their savings, their investments, the financial well-being of parents and grandparents, the future opportunities for their children, the value of their homes. When people are afraid they stop spending money, and the economy — which was already slowing before the crisis hit — sometimes stalls, and can even start to roll backwards. At this point a recession is inevitable.
When people are assured that life will go on pretty much as usual, then confidence returns and they start spending again. Businesses start hiring, and it’s business as usual once again.
What this means for Whistler is anybody’s guess. Tourism Whistler is looking to the regional market in the short-term to shore up an expected loss of U.S. visitors, and the Olympics are expected to open up new markets and opportunities until our bread and butter customers get back on their feet. In the meantime, half the houses in town and most of the hotel rooms are owned by people who, if they can’t rent them out or sell them, will still come up for the odd holiday. We will survive.
But it could get tougher for a lot of individuals and a lot of families. Businesses that already run close to the wire may be forced to close, people could have their hours cut or be laid off. Some business owners may have less money coming in. Consumer goods and necessities could go up in price even further, pushing up our already high cost of living. It could be a lot harder to get mortgages and loans.