Traditionally, agriculture has been the mainstay of the local economy. More recently, forestry and oil & gas production have been of increasing importance to the area. The area has a moderate soil quality rating for crop production, being mainly Class 3, 4 and 5 Canada Land Inventory. Mixed farming and ranching remain the prevailing agricultural operations.
The largest sour gas discovery in Alberta in the last 20 years was made in the area by Shell Canada in 1986. The development of the Caroline Swan Hills Gas Field, with an estimated 2 trillion cubic foot natural gas field and the many economic spin-offs, has contributed to growth in the area.
Recent developments by West Fraser LVL have also added to the local economy. Historically, numerous sawmills and logging outfits were located in and around Caroline, with many land owners clearing farmland and operating their own lumber mills. Today, area logging is on a much bigger scale, with Caroline seeing many loads of timber trucked both east and west.
Recreation and tourism are becoming increasingly significant to the local economy. Up to 3,500 visitors from across Canada, Switzerland, Holland, the Philippines, Finland, the Ukraine, Germany, Australia and Great Britain registered at the Tourist Information Centre last season.