The Canadian Conference Board ranks Calgary and Edmonton behind all the other cities in the country in forecast growth. That is largely caused by the recent fall in oil prices. The province of Alberta is already feeling the impacts of a mild economic recession. It is set to slump behind the rest of Canada in terms of growth. That is according to a recent report released by the Conference Board.
According to http://www.cbc.ca/news/canada/edmonton/recession-predicted-for-edmonton-calgary-following-oil-price-fallout-1.3075643, the board Metropolitan research compared growth projections for 13 cities all over Canada and ranked Calgary and Edmonton at the bottom of the list. Their economies are expected to shrink by more than 1.2 per cent and 0.8 per cent respectively. Alan Arcand, director of the Centre for Municipal Studies of the board, noted that is was a complete turnaround of fortunes from what we have seen in previous times. Earlier surveys have ranked cities in Saskatchewan and Alberta at the summit of the rank list for growth. Surprisingly, the recent report ranks Vancouver, Halifax and Toronto as the Canada’s fastest-growing economies. Associate Director of the Centre for Municipal Studies Alan Arcand, mentioned in a report that the three cities are projected to have their local economies expand by around 3.1 percent.
While the crashing oil prices might be the cause, the Alberta’s construction industry will be the hardest hit, as firms slow down initiation of new projects. The conference board projected the bulk of the recession to happen in the first quarter of the year. The worst economic shrinkage is probably gone. However, the board report suggests slow growth for Alberta’s economy next year, I do not expect it to come back to what Alberta has been all this years. Between the year 2010 and 2014, Edmonton’s economy grew at a rate of around 6 percent annually. That is quite a fast pace. As a person who has been following up the trends of the local economy, I think the fast economic growth days are long gone. However, even in the face of the recession, I expect employment in Edmonton to rise a bit.
The economic decelerate will probably have little effect on the current construction projects that are ongoing in downtown Edmonton. But I predict that businesses will postpone announcing their new construction projects as the economy recedes. Residential homes construction will be the most vulnerable. I expect home sales to slump as buyers postpone their major purchases. In the face of a decelerating construction sector and receding economy, it will be a good moment for the government to increase its spending. With an expected deficit and tight finances, I am worried the province may be unable to achieve its targets. It is a good time to increase government construction spending. However, there is a current slack in the local labor market.
Shaune Vasseur is the owner of http://hydrovac-edmonton.com/. Hydrovac Edmonton has been offering trenching, drilling, hydro-vac, locating and cleanups in Edmonton and its surrounding areas for more than a decade. Integrity, professionalism, as well as customer satisfaction, are the pillars of their business.