Billions in Projects, Thousands of Jobs — So Why Can’t Terrace and Kitimat Find Enough Workers?
A $46,200 regional labour study will investigate why Northwest B.C.’s industrial boom is producing record investment and high wages while local businesses, healthcare providers, retailers and essential services struggle to recruit and retain staff.
TERRACE and KITIMAT, B.C. — Northwest British Columbia is preparing for another multi-billion-dollar wave of industrial development, but Terrace and Kitimat are confronting a serious question before the next boom fully arrives:
Where will all the workers come from—and where will they live?
The City of Terrace and the District of Kitimat have launched a joint regional Labour Market Study to examine workforce shortages, recruitment failures, skills gaps and the growing difficulty of convincing employees to settle permanently in the region.
The study is not simply about counting vacant jobs.
It is an attempt to understand a widening economic contradiction across the Terrace–Kitimat corridor: major industrial projects are creating thousands of jobs and some of the highest wages in British Columbia, yet restaurants, retailers, schools, healthcare providers, local contractors, childcare operators and municipal services continue to struggle for staff.
The District of Kitimat secured a $42,000 grant through Northern Development Initiative Trust’s Rural and Remote Employment Initiatives Fund. The grant covers 90 per cent of the project cost, while Kitimat is contributing a $4,200 municipal share, bringing the total study value to approximately $46,200.
The research is scheduled to run from February to September 2026, with a regional employer survey remaining open until August 10, 2026.
Kitimat Economic Development Director Walsham Tenshak has said existing labour statistics are often too broad to properly explain local conditions because Terrace and Kitimat are frequently grouped with geographically and economically different communities such as Prince Rupert, Houston and Burns Lake.
The new study is intended to identify where employers are recruiting, which occupations are hardest to fill, which skills are missing and what prevents workers from remaining in Northwest B.C. permanently.
The numbers reveal a regional contradiction
The labour shortage is unfolding even though unemployment remains relatively high.
In April 2026, the unemployment rate was reported at:
- 7.2 per cent in Terrace
- 7.9 per cent in Kitimat
- 8.6 per cent in Kitimat-Stikine Area B
Across the larger North Coast and Nechako economic region, employment stood at approximately 42,600 in June 2026, with unemployment at 7.4 per cent.
Kitimat’s local employment level reached approximately 4,590 workers in April 2026. Its employment rate rose to 62.5 per cent, an increase of 2.4 percentage points from the previous year.
Yet the unemployment rate also increased by 1.2 percentage points.
At first glance, those figures appear inconsistent.
If unemployment is above seven per cent, why are businesses still unable to find staff?
The answer is that unemployment statistics do not necessarily measure whether available workers have the right skills, certifications, transportation, housing or childcare required to accept available jobs.
A person may be unemployed but unable to work a rotational industrial schedule.
A healthcare worker may accept a position but reject the move after seeing the cost or quality of available housing.
A parent may want to return to work but be unable to secure childcare.
A trained tradesperson may leave a local employer for a project offering significantly higher wages, overtime, benefits and camp accommodation.
The region does not merely have a shortage of people.
It has a shortage of workers who can realistically match the jobs, wages, schedules and living conditions available.
The $84,000 wage economy
Kitimat’s average employment income has been estimated at approximately $84,000, roughly 40 per cent higher than the provincial average.
That income level reflects the economic strength of construction, manufacturing, smelting, transportation and other industrial sectors.
It also creates a serious imbalance.
Large employers can offer wages, benefits and schedules that smaller businesses cannot match. A local restaurant, retail store, non-profit organization, childcare provider or service company may be recruiting from exactly the same labour pool as an LNG facility, smelter, mine or major construction contractor.
For many employees, the choice is straightforward.
A worker can accept a service-sector position with lower pay and high housing costs, or move into industrial work where annual earnings can be tens of thousands of dollars higher.
This is creating what amounts to a two-speed economy.
The industrial economy is expanding.
The community economy is struggling to keep up.
Small businesses face the greatest risk
Approximately 70 per cent of businesses in the region employ five or fewer people.
For a company with three or four employees, losing one worker can reduce operating hours, delay customer service, cancel contracts or force the owner to work unsustainable hours.
Losing two workers can threaten the entire business.
The labour shortage therefore has consequences far beyond unfilled job advertisements.
Residents experience it through longer waits, reduced business hours, cancelled services, fewer childcare spaces, healthcare vacancies and growing pressure on the employees who remain.
A major industrial project may successfully recruit hundreds of workers while dozens of smaller businesses lose staff at the same time.
The project’s employment numbers may look positive on paper, but the wider community can still become less functional.
From 2,270 forestry jobs to an industrial mega-project economy
The current workforce crisis is rooted in a much larger transformation of the regional economy.
In 1991, forestry supported approximately 2,270 direct jobs between Terrace and Kitimat.
Over the following two decades, the sector lost more than 2,200 direct positions as accessible timber declined, mills closed and the traditional forestry economy contracted.
Terrace gradually shifted toward becoming Northwest B.C.’s service, retail, transportation, healthcare and administrative centre.
That transition was disrupted—and accelerated—by a new era of capital-intensive industrial development.
The most significant turning point came in 2018, when LNG Canada announced a positive final investment decision on its approximately $40-billion export terminal in Kitimat.
Construction began in 2019 and followed other major investments, including Rio Tinto’s smelter modernization and BC Hydro’s Northwest Transmission Line.
Those projects brought thousands of workers, contractors and suppliers into the region.
They also pushed housing costs higher, tightened rental availability and increased competition for employees in nearly every sector.
The economic base changed from one dominated by forestry to one increasingly driven by LNG, construction, heavy manufacturing, mining and transportation.
The region became wealthier in capital investment, but more strained in its ability to provide housing and essential services.
Housing exists on paper—but not always in reality
Housing is one of the most serious barriers to recruitment and retention.
Some data suggested Kitimat’s nominal rental vacancy rate reached as high as 19.8 per cent in 2024.
However, municipal feedback indicated the functional vacancy rate for suitable, good-quality housing may have been closer to 10 per cent.
That difference is critical.
A vacant unit is not necessarily a usable unit.
Some rental properties may be in poor condition, lack accessibility, be unsuitable for families or fail to meet the expectations of professionals relocating from larger centres.
A nurse, teacher, engineer or family may technically find an available unit but still decide that the housing does not justify moving hundreds or thousands of kilometres.
The region also lacks enough diversity in its housing supply.
There is demand for apartments, townhouses, family rentals, accessible units and housing for seniors. Yet development remains constrained by the fear of another boom-and-bust cycle.
Developers may hesitate to build during a construction boom if they believe demand will fall sharply once major projects move into operations.
That leaves Terrace and Kitimat caught between immediate need and long-term uncertainty.
The worker arrives—but the family cannot settle
A successful recruitment campaign does not guarantee permanent settlement.
Workers considering Terrace or Kitimat must also evaluate whether their spouse can find employment, whether their children can access childcare, whether healthcare is available and whether the family can afford suitable housing.
Childcare is particularly important.
A household may have two employable adults, but if childcare is unavailable, one parent may remain outside the labour force.
That reduces household income and removes a potential worker from the regional economy.
Transportation creates another barrier.
The Terrace–Kitimat corridor depends heavily on Highway 37, with limited alternatives for workers who do not own vehicles or cannot drive long distances in winter conditions.
Fuel costs, vehicle expenses, winter safety and shift schedules all affect whether a person can realistically commute.
For rural residents and First Nations communities, the distance between home, training and employment can be even more significant.
Indigenous workers must be part of the regional workforce strategy
Northwest B.C.’s future labour supply is closely connected to the Nisga’a, Tahltan, Haisla and other Indigenous communities across the region.
These communities have younger and more geographically stable populations than many non-Indigenous rural communities.
However, Indigenous workers have historically faced barriers including limited local training, inadequate transportation, workplace discrimination, cultural misunderstandings and the need to leave home communities to obtain certifications.
The Nisga’a Lisims Government’s NEST Labour Market Study identified systemic racism, cultural barriers and a lack of standardized local training as obstacles to workforce participation.
Major industrial proponents are increasingly being required to address those issues.
Cedar LNG has committed to prioritizing Indigenous and regional hiring, including sharing employment opportunities with First Nations before broader public advertising.
Skeena Resources’ Eskay Creek project has committed to localized apprenticeship programs, transferable skills development and cultural-awareness training.
LNG Canada has also developed social-management planning intended to address project impacts on housing, healthcare and other community services.
These commitments reflect a growing recognition that Northwest B.C. cannot build a sustainable workforce entirely through fly-in, fly-out and temporary labour.
Permanent economic growth requires investment in people who already live in the region.
Another $69 billion development wave could be coming
The labour shortage may become much more severe.
A 2026 Mining Association of B.C. study identified 24 proposed or developing mining projects across northern British Columbia that could generate approximately $69 billion in economic activity.
The projects include critical minerals, precious metals and steelmaking coal developments.
If several proceed at the same time, the demand for tradespeople, equipment operators, engineers, environmental professionals, administrators and support workers could rise sharply.
The region would then face competition not only between industrial and service employers, but also among major industrial projects themselves.
At the same time, forestry remains vulnerable to tariffs, mill closures, fibre shortages and international trade disputes.
Workers displaced from forestry may be available, but they will require retraining to enter construction, mining, manufacturing or technical occupations.
Without local retraining programs, many may leave the region before new opportunities become available.
A boom that weakens the community
The danger is not that Northwest B.C. will run out of economic activity.
The danger is that it will attract more projects than its communities can support.
A project can bring thousands of workers into the region while worsening shortages in restaurants, retail, childcare, healthcare and municipal services.
Workers may live in camps, follow rotational schedules and spend a limited share of their income in the local economy.
Meanwhile, permanent residents face reduced services and higher living costs.
This creates a model in which the region becomes highly productive but increasingly difficult to live in.
Terrace and Kitimat risk becoming centres where people arrive to earn money but do not remain to raise families, buy homes, open businesses or build long-term community ties.
What the study must deliver
The joint Labour Market Study must produce more than another report confirming that workers are difficult to find.
It must identify:
- The occupations with the most severe shortages
- The number of workers businesses expect to need
- Where employers are currently recruiting
- Why workers reject job offers or leave after arriving
- How housing costs affect recruitment
- How many workers are excluded by childcare shortages
- Which training programs are missing
- Whether transportation prevents people from accepting work
- How industrial wages affect local businesses and public services
- What role First Nations and local training institutions can play
The findings should be used to guide housing policy, transit planning, workforce training and requests for provincial and federal funding.
Possible responses could include affordable-housing reserve funds, higher-density zoning, employer-supported housing, expanded apprenticeship programs, regional childcare planning and improved transit between Terrace, Kitimat and surrounding communities.
Coast Mountain College, First Nations employment agencies, municipalities and major industrial employers will all have to participate.
The real question is not where the workers are
Terrace and Kitimat already know that workers are missing.
The more important question is why a region surrounded by billions of dollars in investment cannot provide enough housing, childcare, transportation and community infrastructure to keep them.
The corridor has already experienced the collapse of more than 2,200 forestry jobs, the arrival of a $40-billion LNG project, average Kitimat employment income of approximately $84,000, unemployment rates above seven per cent, and the prospect of another $69 billion in northern mining activity.
Those numbers tell the real story.
Northwest B.C. is not suffering from a lack of economic opportunity.
It is suffering from a growing inability to convert economic opportunity into stable, permanent and livable communities.
The success of the new labour study will depend on whether Terrace and Kitimat use its findings to prepare for the next industrial wave—or wait until the worker shortage becomes a full regional crisis.
