JANUARY/FEBRUARY 2023 BCBUSINESS.CA 45 ISTOCK
RECESSION
T H I S I S N ' T 2 0 0 8
You'd be forgiven if your mind
transports you to 2008 the moment
you hear the word "recession." But
whatever this predicted downturn
technically turns into, its charac-
teristics are a lot more reminiscent
of an earlier recession, according
to Peacock.
"You think of [the 2007-08
financial crisis], where central
banks were slashing rates to bolster
the economy as we went into reces-
sion," he recalls. "This is entirely
different because of the inflation
picture—it makes it more like a 1981-
82 recession, which creates a great
deal of uncertainty. Most banking
economists
expect inf la-
tion to moderate
and come down in 2023,
but it's not a slam dunk. It's far
from a slam dunk."
T H E L A B O U R M A R K E T
S H O R TA G E P R O B A B LY
I S N ' T G O I N G AWAY
A key difference between the reces-
sion of the early 1980s and the situ-
ation today is the unemployment
rate. Unemployment averaged over
11 percent in B.C. in the '80s. Since
the middle of
last year, it has hov-
ered around 4.5 percent.
In fact, B.C. is dealing with the
opposite problem right now. "We're
in the throes of a labour shortage
that is likely going to last several
years," says Famulak.
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