What Albertans can expect from the economy in 2023

Last year was a financial roller-coaster, and Alberta probably isn't getting off the ride in 2023. But the province appears in a better economic position than most others to handle the nauseating rises and falls.

Economists and banks are forecasting that heavy inflation, volatile energy prices and geopolitical uncertainty will continue to be factors this year. 

"2023 is going to have a lot of uncertainty associated with it, especially for Alberta. Where the province goes economically is tightly related to commodity prices, which are determined by all sorts of global factors," said Trevor Tombe, an economist at the University of Calgary.

Alberta, however, has some tools to help it adjust. 

"We're still getting a pretty good boost from our commodity sector in oil and gas and agriculture. So rough waters — can't avoid them — but we'll be able to do a little bit better than other places," said Rob Roach, the deputy chief economist at ATB Financial. 

An influx of new Albertans, recovering job numbers and record profits in the oil sector are all positives. 

Despite that cushion, the threat of recession still looms. 

Inflation and the cost of living consistently ranked at the top of polling on Albertans' preoccupations in 2022. 

Canada's inflation rate sat at 6.8 per cent at the end November, and Alberta's sat barely lower at 6.6 per cent (down from a high of 8.4 per cent in June). 

All categories of goods were more expensive in the province last year. Food (10.6 per cent) and transportation (7.1 per cent) increased the most, according to the province. 

Inflation is expected to remain high for most of 2023.

"Where inflation goes is a big open question, not uniquely in Alberta, but that's the most important thing to watch," Tombe said. 

He expects inflation will likely fall to around three per cent by the end of the year, which is close to normal levels. 

Even if things stay relatively stable on a provincial level, Roach said people will still feel the sting in their wallets.