Alberta's surging oil economy is growing so quickly that service industries can't compete, budgets for infrastructure projects can't keep up with rising labour and material costs, and oil companies are building their own housing projects.
"Calgary is growing so fast that the city is moving ahead with plans to expand its footprint by annexing the countryside outside its boundaries. But the budget for infrastructure projects is being blown as costs of labour and materials both jump. One wastewater treatment plant, for example, now has a price tag of $370-million, up from last year's budgeted cost of $240-million.
The Canada Mortgage and Housing Corp. said this week that Alberta is poised to break an almost 30-year-old record for new housing starts. The Canadian Real Estate Association recently reported the largest jump in sales volume for Canada, making the rise in resale prices seem like a lottery win.
The rental market is as tough to crack.
CMHC just projected that Calgary's vacancy rate will drop to 0.6 per cent this year and stay that way through 2007 -- the lowest rate in Canada. Edmonton's rental market is similarly tight at what CMHC projects as 1.5 per cent this year and 1 per cent next year.
Many newcomers are forced to live in trailers, tents and illegal basement suites.
The number of homeless people also seems to be on the rise. In 1992, when Calgary began its biennial count of the number of homeless in the city, there were 447 people without permanent shelter; this spring, the number reached 3,436. In Edmonton, the homeless population hovers at about 2,200."
FULL STORY: The short-handed economy
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