Economy won't fully recover until at least 2022

Imagine a long and bumpy road in a truck with suspy suspension.

That’s the way the Kelowna economy feels right now and will continue to be for the foreseeable future.

"There are glimmers of hope," said Central Okanagan Economic Development Commission manager Krista Mallory.

"But we know it will be a long, bumpy road to recovery. Many are saying it won't be until 2022 that we're back to where we were before the pandemic hit."

Mallory bases her observations on the Central Okanagan's third-quarter economic indicators report released this week.

The report tracks nine indicators, most of them from July, August and September of this year, and compares them to the same pre-COVID months last year.

Positive indicators include population growth, housing starts, business licences and apartment rents.

However, labour force, airport passengers, new home prices, building permit values and job postings are lagging.

"It's mixed, for sure," admitted Mallory.

"Building permit values have been particularly hard hit, yet housing construction starts are up. I think that speaks to the fact that people are continuing to move here and there's a need for housing, but developers may not be taking out building permits to build big commercial and institutional projects."

The housing market is booming with two types of buyers.

Locals who may not have liked the home they quarantined in earlier this year are moving to digs that better suit them.

And buyers are arriving from Vancouver and Alberta to start a new life enjoying the Okanagan lifestyle.

Many of them figure if they are going to be working from home, they might as well be in Kelowna rather than Vancouver, Calgary or Edmonton.

The number of licensed businesses in the Central Okanagan was a healthy 13,882 at the end of 2019 before COVID exploded.

The latest figure isn't known yet, but it's expected to go down because some businesses have closed, victims of the pandemic.

- 3,528 job postings in Q3 is down 26% from the same quarter last year, indicating employers aren't hiring as much. However, job postings are up 4% right now, compared to the darkest days of COVID, mid-March through April.

- As of September, the number of people with jobs in the Central Okanagan was 99,044, down from 105,544 at the same time last year.

- Building permit values of $613 million are down 35.8% January through September this year compared to the $955 million issued over the same nine months of 2019.

- At 1,585, housing construction starts are up 4.5% January through September this year compared to the 1,517 starts over the same time last year.

- The passenger count of 617,167 at Kelowna International Airport has taken a 60% pummelling in the first nine months of this year compared to the same period of 2019 at 1.5 million.

- The median new home price in Kelowna in Q3 was $877,500, a 2% slip from the same time in 2019. The median home price in Calgary is $540,000, Toronto $1.05 million and Vancouver $1.6 million.

- The Central Okanagan's population at the end of 2019 was 217,214, up 2% from 213,195 in 2018. An estimate for 2020 isn't out, but is expected to show growth.

- The average rent for a two-bedroom apartment in the city was $1,363 in 2019, up 9% from the year before. The COVID-impact has moderated rent increases in 2020.