by Jessie Radies
Our city & province spend a lot of time worrying about growth & how we are going to manage it. Oil Sands & resource development drives our economy, and our biggest concerns are how to manage the growth, how to attract and retain the skilled people we need to ensure our economy can continue to grow.
I don’t think growth is our biggest issue. I think dependency on one industry is our biggest threat.
We often worry about “peak oil” or the $200/barrel of oil. These things don’t worry me that much, I believe that these changes may come, but it will be a gradual change, and we will adapt and change, I also believe that we live in a bit of an insulated bubble. It may happen, but we will feel it here after other regions have figured out how to adapt.
My bigger concern is $50/barrel oil. We know that oil sands production is an expensive process, and it doesn’t make economic sense unless oil is at about $70/barrel. We know the price of oil is volatile and is impacted by a small number of factors.
What would happen if the price of oil dropped for a year, or five years, or 10 years?
It would decimate our economy and our communities
We do not have the economic diversity or resiliency to bounce back from that kind of economic shock. Our agriculture & manufacturing industry are shrinking, our tech and medical industry is highly specialized and comparatively small. Our local retailers, the construction industry, financial services, business services are in large part supported by the activity that comes out of the energy industry.
Other places have been in similar situations, Detroit, Cleveland, Birmingham and if they saw the downfall of manufacturing, they did not prepare for it adequately. I suspect no one anticipated it and it happened faster than they could adapt.
For every public dollar we are spending to support oil, oil sands or gas resource development, we should be spending a minimum of $5 in diversifying our economy. In sectors that can provide our population long term, economic diversity and stability.
We can keep worrying about managing growth or we can use the economic opportunity the oil sands offer us to diversify. Oil is a blessing and possibly a curse, are we smart enough to prepare for the end of oil, no matter when or how it happens?
I really hope so.
As the founder of Live Local Alberta, Jessie has a vision for Alberta as a diverse, vibrant and sustainable region. Live Local Alberta is dedicated to educating consumers on the benefit of shopping, eating and living locally and to giving small business owners strength in numbers. A self-proclaimed foodie, Jessie along with chef husband Darcy own The Blue Pear Restaurant in Edmonton. Jessie has held a variety of roles within the food chain including working in the restaurant industry for 25 years, some of which for multinational fast food companies. Jessie and Darcy have two children and live in Edmonton.