June 10, 2008
Economy at a Glance - June 11, 2008
The bloom on Alberta's economy may have faded, but it hasn't fallen
As the Wild Rose province heads into the second half of the year, employment is growing by 3% year over year, unemployment sits at 3.3% and an unprecedented 72.1% of its working age population (15 years of age and older) has a job.
Clearly, the Alberta economy is still operating in high gear. Over the past 12 months, particularly healthy increases in job growth have occurred in wholesale and retail trade (+36,600), financial services (+20,800), professional and technical services (+16,500), agriculture (+16,000) and construction (+14,100).
Increases in these industries have offset declines in education services employment (-13,100), in manufacturing employment (-10,900) and information services (-9,400).
Despite this picture of current economic health, there are signs that the province is losing momentum. Over the past year, employment growth has slowed from a high of +6.7% year over year in January 2007 to its current rate of +3.0%.
This slowing in job growth has been accompanied by a drop in net migration, which in turn has contributed to a softening in housing demand. Existing home sales have fallen by 28.4% year to date, while the number of new listings has increased by 32.9% and year-to-date housing starts are down by 16.7%.
Looking forward, although Alberta has lost some of its momentum, three factors should continue to provide it with ample support over the next two years:
(1) Record-high oil prices and higher natural gas prices should sustain energy exploration and resource development into 2010;
(2) Healthy growth of office-based employment, combined with very low commercial vacancy rates, will support the growth of commercial construction over the next several quarters; and
(3) The province continues to be in excellent fiscal health.
John Clinkard has over 30 years experience as an Economist in international, national and regional research and analysis with leading financial institutions and media outlets in Canada.
Gross Domestic Product (GDP) - Alberta vs Canada
*"Year over Year" is the monthly figure vs the same month of the previous year.
Data source: Statistics Canada/Forecasts and chart: Reed Construction Data - CanaData.
