While Saskatchewan is feeling the pinch of plunging oil prices, a new report says the province isn’t expected to slip into recession this year.
The Conference Board of Canada predicts Saskatchewan’s economy will grow by a modest 0.9 per cent this year and 2.1 per cent in 2016.
Saskatchewan is expected to shed 1,420 jobs this year, while the provincial unemployment rate is anticipated to rise to 4.6 per cent and remain at that level into next year.
Despite that increase, Saskatchewan’s unemployment rate would remain the lowest among the provinces.
“With the oil sector an important part of the Saskatchewan economy, the province is feeling the impact of lower oil prices,” the Conference Board’s Marie-Christine Bernard said in a news release Thursday.
“The number of well drilled was down this past winter, and capital expenditures in the energy sector are not expected to recover until 2017.”
However, Bernard says strength in potash and metal mining, as well as a rebound in the agricultural sector, will soften the blow of lower oil prices on Saskatchewan’s economy.
Mining output is expected to shrink by 2.6 per cent in the province this year, due to a decline in mineral fuel production.
But mineral fuel output is expected to rebound next year, leading to growth in the mining sector.
After a difficult year in 2014, agriculture is expected to make a comeback in Saskatchewan this year, with projected growth of 5.1 per cent in 2015.
Meanwhile, the province's manufacturing and services sectors are expected to see moderate growth over the next two years.
The report says a recession is unavoidable this year in Alberta, where the provincial economy is expected to shrink by 0.7 per cent in 2015.
