Economic crunch continues to claim business in Calgary

by Jonathan Muma Posted May 27, 2016 7:29 am MDT As the Alberta economy sputters along, another Calgary staple is feeling the pinch and has had to close its doors.FARM Restaurant on 17 Avenue has been shuttered after eight years, with a note on its website saying they are simply unable to carry on in this economy.It’s a scenario economists have been warning about since the price of oil cratered.Even though it has dropped again, ATB Financial Chief Economist Todd Hirsch tells City News it’s encouraging oil hit $50 a barrel Thursday.“However, it doesn’t really change the fact that world is still awash in oil and it’s going to take some time until all that inventory gets depleted,” he said. “And I don’t think we can anticipate that oil prices will remain above $50 and continue to climb, I think we’re going to remain in this zig-zag pattern for a little longer.”As for the news another restaurant has shut down, Hirsch says he’s not surprised given the margins are razor-thin even at the best of times.“I think it’s a shame because I love the restaurant scene in Calgary and I hate to see them go. But given the current economic conditions, I’m not really surprised some of them are going to have to shut their doors,” he said.Still, he believes lower-price point restaurants can still profit in this economy because people still have to go out, when travelling for example, and will look for cheaper menus.Hirsch adds it’s a similar, difficult story for retailers.“Simply again because of the rising unemployment rate and fewer discretionary dollars to spend on discretionary items,” he explained. “Grocery stores and staples like that should be fine, but some of those other retailers may have a difficult time.”If there’s a silver lining, Hirsch still believes tourism will see a bump this year which could help as people take advantage of the cheap Canadian dollar. AddThis Sharing ButtonsShare to TwitterTwitterShare to FacebookFacebookShare to RedditRedditShare to 電子郵件Email Economic crunch continues to claim business in Calgary The message telling customers FARM Restaurant is closing. read more