Summertime is when cyclical, seasonal businesses like Dan Bassio's usually see an uptick. But the economic downturn resulting from Alberta's oil shock has small businesses like his in the province holding off on summer hiring.
"We usually see it cycle up, and the concern this year is that we're not going to," says Mr. Bassio, owner of Ossab Moulding and Millworks. His Edmonton-based company runs three lines of business that serve residential markets: installing mouldings and millworks such as baseboards, fireplace mantles and crown moulding; providing and installing verandas and decks; and supplying and installing rear detached garages. Summer is their peak season, and Mr. Bassio usually sees a 20-per-cent spike in employment during these months.
"May and June are usually when we see those indicators," Mr. Bassio says. "But we're already at the end of June here and we're not seeing that spike."
Mr. Bassio hasn't hired anyone new; instead he's had to slash his work force. Last year, he had 36 full-time employees, but drastic layoffs over the winter saw that number dwindle to 18.
"It's a real challenge, the work just isn't there," he says. "We're working our butt off to keep our guys employed."
The economic slowdown in Alberta has affected many small businesses, especially those in the residential housing market, Mr. Bassio says. The drop in oil prices has made it harder for just about everyone in Alberta to keep operating like they used to.
It's a sentiment that is felt by small businesses across Alberta, a province still reeling from the drop in oil prices. And students who used to be able to rely on summer jobs are now feeling the impact.
"There are indicators that things are a bit tighter this summer than they've been in the past," says Joan Schielbelbein, director of the career centre at the University of Alberta in Edmonton. Every January, the university runs a summer job fair, where employers set up booths to recruit students to join them for the season. Employer exhibitors were down approximately 18 per cent this year, when compared to the previous one. Job postings, she says, were also down. From Sept. 1, 2015, to June 15, summer job postings were 7 per cent lower than the previous year.
"Generally those numbers are pretty stable," says Ms. Schielbelbein, who adds that the biggest drop in employment offerings is from the oil and gas sector, but says a domino effect is causing others to hold off on hiring as well.
"Over all, the state of business is still way down," says Amber Ruddy, director of provincial affairs with the Canadian Federation of Independent Business. The CFIB's most recent monthly numbers on small-business sentiment show a continued downward trend. According to May data, one-third of small businesses are looking to cut back, and only 8 per cent are in a position to hire.
Grant Smith, owner of Velocity Hydrovac Services in Red Deer, says as much as he'd like to, he hasn't hired anyone new this summer. Velocity is an underground utility construction company that offers hydrovac excavation, pipe lining services and utility construction. Oil and gas companies are a big chunk of its customer base.
"I've been in the industry 10 years and I've never seen the rates [oil prices] go this low," says Mr. Smith, who currently has seven employees, but used to operate with double that number. "The drop in oil rocked everyone."
"We've held off on hiring as long as we can because we want to keep the work around for people that we do have," Mr. Smith adds.
While the situation this summer is dire, Ms. Schielbelbein says it would have been worse if it weren't for provincial and federal policies put in place, which have helped offset further job losses. This year, Alberta's NDP government reinstated the Summer Temporary Employment Program (STEP), which allocated $10-million to support more than 3,000 jobs this summer. The program, which had been cut by the previous government, provides funding for employers to hire students for the summer. Historically, it was used by the non-profit and public sector, but this year the government added small business as well.
"Recognizing the global drop in the price of oil is causing economic pain for many Alberta families and business owners, we also expanded STEP to support small businesses for the first time to help them with their summer hiring during these tough times," Alberta's Minister of Labour Christina Gray said in a statement.
Twenty per cent of the funding available went toward small businesses, which the CFIB's Ms. Ruddy says was helpful, but she thinks more could be done. Franchises, she says, were left out of the small-business funding, and not all businesses that applied received funding.
"Unfortunately, we received more applications than we could approve with the $10-million allocation. We are extremely pleased with the uptake and will be reviewing this program to look for opportunities for improvements in the future," Ms. Gray says.
In the meantime, small businesses like Mr. Bassio's are bracing for more tough times ahead.
"It's all cyclical, it's going to come back," he says. "But I think it's going to be another challenging year ahead."