Ottawa ON, Nov. 05, 2019 (GLOBE NEWSWIRE) — After posting modest economic growth this year, the Canadian economy is poised to show some improvement with a 1.8 per cent gain forecast for 2020. Despite our call for stronger growth next year, risks to the forecast remain tilted to the downside. On a positive note, job creation has been very strong this year, thanks to strength in certain cities and sectors. Unfortunately, employment growth is expected to cool next year as tightening labour markets constrain the ability of firms to hire workers.
These figures can be found in The Conference Board of Canada’s Autumn released today. The report provides detailed economic insights for 13 Canadian Metropolitan Area economies: Halifax, Québec City, Montréal, Ottawa–Gatineau, Toronto, Hamilton, Winnipeg, Regina, Saskatoon, Calgary, Edmonton, Vancouver, and Victoria.
Quotes from Alan Arcand, Associate Director, Municipal Economics:
“We have been pleasantly surprised by the solid economic conditions in Montréal and Vancouver; the two metro areas that are poised sit atop the GDP growth rankings in 2019. Montréal is on track to post its third consecutive year of 3 per cent or better economic growth—its economy has benefitted over the last number of years from major infrastructure projects. Vancouver will be close behind with a projected 2019 expansion of 2.8 per cent, thanks to near-record housing starts and strong job creation. While Vancouver’s economy is expected to continue humming along next year, slower growth is in the cards for Montréal.”
“Regarding Alberta, the government has eased crude oil production curtailments through 2019, providing some positive momentum heading into 2020. Accordingly, we expect overall conditions to improve enough to allow both Calgary and Edmonton to post moderate economic growth at around 2.0 per cent next year, still well off the robust gains experienced over the boom years.”
Key Findings per Province
Nova Scotia is poised to see its strongest gain in nearly 10 years this year, with real GDP expected to rise 2.1 per cent in 2019. Strength is coming from Halifax’s economy which is expected to expand by 2.6 per cent this year, the biggest increase since 2010; real GDP growth will slow to a still solid 2.1 per cent next year.
Quebec’s economy will expand by 2.3 per cent this year and 1.4 per cent in 2020, down from gains of 2.9 per cent in 2017 and 2.5 per cent in 2018. Montréal’s economic growth of 3.0 per cent will lead major metropolitan areas in Canada in 2019. Québec City is also surpassing expectations. On the employment front, the local economy will follow a hot 2018 with an even hotter 2019. The labour market is on track to add almost 12,900 net new jobs this year, up from a net gain of 9,200 jobs last year.
Ontario can expect to see a drop in public spending, weakening growth to 1.4 per cent in 2019 and 1.7 per cent in 2020. On the bright side, employment gains will persist. The province added nearly 145,000 jobs in the first two quarters of 2019. In Hamilton, the unemployment rate will drop to a record-low average of 4.4 per cent in 2019 and increase modestly to 4.6 per cent in 2020. Housing starts are poised to ease from a 14-year high of 3,600 units in 2018 to 2,900 units in 2019 and remain near this level in 2020. Toronto is expected to follow up a 2.0 per cent gain in 2019 with a 2.2 per cent expansion next year.
Manitoba will see a slow down in export growth; economic activity in Manitoba will be weaker this year and next, with real GDP expanding by 0.5 per cent in 2019 and 0.9 per cent in 2020. The Winnipeg economy will shift into lower gear. Following increases averaging 2.8 per cent between 2016 and 2018, real GDP is set to expand by a much slower 1.7 per cent in 2019 and an even cooler 1.5 per cent in 2020.
Saskatchewan’s economy remains weak, due mainly to softness in the province’s primary sectors; real GDP will post no growth this year and expand by a moderate 1.2 per cent in 2020. Saskatoon’s real GDP is forecast to dip 0.2 per cent in 2019 but rebound by 1.6 per cent in 2020. Housing starts are set to hit a post-recession low near 1,200 units in 2019 and rise only slightly to just under 1,400 units in 2020.
Alberta’s early 2019 predictions showed weakened economy as the energy sector reacted negatively to mandated production cuts. However, energy exports came in much stronger than expected in the second quarter of 2019; we no longer have a technical recession in Alberta this year, although the economy is not expected to grow. The Calgary economy will contract by 0.4 per cent in 2019, but a 2.0 per cent increase is forecast for 2020 as the energy sector stabilizes. Additionally, Edmonton’s economy is expected to contract by 0.4 per cent this year, weighed down by mandated oil production cuts.
British-Columbia’s economy is projected to grow another 2.4 per cent this year and 2.6 per cent in 2020. This keeps B.C. amongst the top three provinces in terms of growth in 2019 and 2020, thanks largely to its strong labour markets. Vancouver continues to be one of the country’s top-performing metropolitan-area economies; real GDP gains are anticipated to reach a solid 2.8 per cent in 2019 and 2.6 per cent in 2020.
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Michelle Rozon | Erin R. Brophy
The Conference Board of Canada
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