It's being called 'staggering', 'dire' and 'worse than the 2008-09 recession'.

It's how experts are describing Kelowna's ultra-high unemployment rate of 11% and the construction collapse that's caused most of it.

"It's worse than the 2008-09 recession," said Cassidy deVeer, executive officer of the Central Okanagan branch of the Canadian Home Builders' Association.

"At least in 2008-09 there was a bit of luxury building going on to prop things up a little. Now it doesn't make sense for builders to build either market housing or rentals."

Renee Merrifield is the CEO of Troika Developments.

"The number of layoffs in construction right now is staggering," she said.

"For the first time in my 25 years in this industry I'm seeing projects cancelled after the developer launched and took deposits. They're pulling out, giving deposits back and cancelling."

deVeer is seeing it, too.

"There's a lot of dire news," she said.

"Builders from Alberta who had satellite operations in the Okanagan have closed up here. I've seen builders that used to have 18 employees now down to 2. And I've had lots of emails returned with 'this person no longer works here'."

When Statistics Canada data was released last week it pegged Kelowna's November unemployment rate at 11% — the highest in Canada.

That's a significant jump from 9.3% in October and well above BC's provincial jobless rate of 6.4% and the national rate of 6.5%.

Translated into numbers, Kelowna's hefty 11% unemployment rate means 16,200 people were looking for work in November, up from 13,800 in October.

The number of people with jobs in Kelowna dropped from 133,900 in October to 131,700 in November.

In 2022 when residential construction was booming and it was the largest economic driver in Kelowna with $2.5 billion in annual impact, there were 19,000 working in the sector.

By November 2025, 12,000 were working in residential construction.

That number is expected to dwindle further as layoffs continue and construction activity dries up.

How have Kelowna's fortunes fallen so far and so quickly?

Well, during the pandemic the city had a real estate boom.

People decided if they were going to work from home they might as well do so in a lifestyle mecca like Kelowna.

People moved here, it drove up prices and demand for all kinds of housing and prompted a building frenzy.

Condominium towers rose and a proliferation of 6-storey rental apartment buildings were started with all levels of government offering tax, financing, density and fast-approval incentives to developers to build rentals.

Then, strict new short-term rental rules came into effect scaring away condo investors and the incentives ended for rentals.

It resulted in a market where projects already started are being completed now and nothing new is being started.

The glut of condos and rental apartments means prices and rents have softened and sales and rental activity have slowed.

"But, you'll never see housing prices slashed because the cost of construction is so high," pointed out deVeer.

"So, what you'll see instead is cancelled projects and no one building until things get better. Right now, even if someone gave you free land, it wouldn't make sense to build either market (for sale) housing or rentals on it because the cost of construction is so high. It's a cost of delivery crisis."

Merrifield's Troika Developments is one of the few construction companies in Kelowna to have grown over the past year.

It has several of those 6-storey rental apartment buildings with incentives in the pipeline to keep crews busy.

The City of Kelowna's monthly Housing Dashboard shows that September 2023 was the pinnacle with building permits issued for 920 housing units and January 2025 peaked with 850 housing unit completions.

This month, the projection is for building permits issued for 10 housing units and 20 housing units to be completed and come on the market.

In boomtime 2021, the Canadian Home Builders' Association's Housing Market Index showed builder confidence in selling a newly completed single-family home was 95%, a townhouse or condo 90.5%.

Today, that confidence is decimated to 11.7% and 14.7%, respectively.

Merrifield stresses there's still demand for all types of housing, if only the cost of construction (and ultimately the price the consumer pays) comes down.

"Yes, there is a solution," she said.

"(Kelowna should) lower DCCs (development cost charges) because they add $28,000 to the cost of a 500-square-foot (apartment or condo) and $50,000 to the cost of a single-family home. Banks should not be stuck on financing based on pre-sales. Take expensive things out of the provincial building code. And continue incentives and tax breaks so builders can build all kinds of housing."

deVeer concurs.

"BC is a very, very tough province to do business in," she said.

"Banks are not lowering mortgage interest rates as fast as the Bank of Canada is and mortgages are still expensive. And the GST rebate (for first-time buyers of new homes) that was announced in February is still not in place. Plus, the rebate should be extended to all new home buyers."

deVeer warned that laid-off construction workers won't stay in the Okanagan, but will likely move to Alberta or Saskatchewan, where building is brisk.

And then, when the Okanagan needs them again when construction eventually picks up they won't be around, creating a labour, skills and trades shortage.