UPDATE: Bank Failure Friday
Bank Failure #22: Cape Fear Bank in Wilmington, N.C.
Bank Failure #23: New Frontier Bank of Greeley, Colo.
When the stock market crashed, we shrugged our shoulders. Canada was economically sound and BC was even better off than the rest of the country.
The attitude bordered on arrogance.
From a July 22, 2008 Vancouver Sun article:
Finance Minister Colin Hansen looked The Vancouver Sun's editorial board in the eye late last week and maintained that, despite all the economic gloom and doom that's going around these days, the B.C. economy is doing pretty well.
From a October 20th, 2008 CTV story:
Finance Minister Colin Hansen introduced his Liberal government's economic relief package in the legislature, saying the province will avoid recession. "None of the leading economists that I have heard from have indicated a forecast of a recession," Hansen said. "Relatively speaking, British Columbia is doing remarkably well."
Oh how the times have changed.
The StatsCan data now puts B.C. at the epicentre of a massive Canadian recession. Gone is the talk of no provincial budget deficits. And the Real Estate industry - its folding in on itself.
For hidden in the job loss numbers is the real impact of what is happening.
Last month, the B.C. economy shed 22,600 jobs. But those numbers hide the full measure of the drastic downturn in B.C.'s construction/real estate sector.
The were actually job gains last month. B.C.'s service sector (the accommodation and food services sector) saw employment grow by 7,200 jobs.
7,200 jobs gained!!!
And these job ADDITIONS disguise the profound devestation that hit the Real Estate sector.
Last month not only did 16,000 construction jobs disappear; but there were 8,500 lost positions in the financial, insurance, real estate and leasing sectors - the support system for the housing industry. And the tally in those areas alone is greater than the overall number of net lost positions in the B.C. economy.
For any newly unemployed journeyman or real estate agent who has been longing to become a waiter, that's great news.
For anyone else, it's a sign of an economy that is shedding high-paying, full-time work for low-wage, part-time employment.
With the American and European economy in full retreat, look for BC's service sector industry to take in on the chin this summer. Which means the job loss hit parade will continue throughout the spring/summer months.
And as we have said before, people who substitute low paying part time jobs for high paying full time ones... and people without jobs... well they simply can't pay mortgages or buy new condos.
The blueprint for fall and winter in BC Real Estate is being drawn now. And it doesn't look pretty.