“The biggest negative impact is the cutback in production in the three oil rich provinces, Alberta, Newfoundland and Saskatchewan,” Guatieri said. “Which means their economies will take a bigger hit than the national economy.”
Those economies have been economic leaders over last couple of years, said Guatieri, with Alberta and Saskatchewan pumping out jobs and instilling much-needed confidence in Canada’s economy for consumers to go out and spend.
Oil’s plunge, sparked by recession fears in Europe and China, is now shaking that foundation.
“There is reason to be concerned that some people in the oil industry will lose their jobs if oil prices hit $80,” Guatieri said, “or fall further.”
“Consumer spending has been quite strong in Alberta in particular, while growth has been strong. But that will take a hit,” the BMO economist said.