Calgary's economic growth will slow to 2.5% this year, predicts Conference Board of Canada
Report forecasts city's unemployment rate to dip to 6.2% by 2022
After rebounding out of the recession with an almost seven-per cent GDP growth spurt in 2017, the economy in Calgary will grow at a much more gradual rate for the next few years, the Conference Board of Canada forecasts.
Calgary's GDP will rise by 2.5 per cent in 2018 and by 2.1 per cent in 2019 — rates that pale in comparison with the 6.9-per cent bounce-back the province experienced last year, the board said in its Metropolitan Outlook report released Tuesday.
"Last year's strong rebound was accordingly welcome, although we estimate it did not quite recoup the two real GDP losses," the report said.
"That task will be accomplished this year, as we expect Calgary's real GDP to expand 2.5 per cent, putting local real GDP at a fresh record high."
The jobs recovery is forecast to slowly continue in Calgary in 2018, with an additional two per cent employment growth, which will trim the unemployment to 8.2 per cent.
"We think moderate employment growth of one to two per cent annually will trim the unemployment rate to 6.2 per cent by 2022," the board said.
The board notes that there are several big-ticket infrastructure and commercial building projects that will provide jobs in Calgary for several years, including the $4.7-billion Green Line LRT line, the huge $3-billion StoneGate Landing business park on 1,000 acres north of the airport, the new $1.4-billion cancer facility at the Foothills Medical Centre and the city's $87-million upgrades to Crowchild Trail.
On the other hand, construction firms will be wary of the residential market in 2018 because of a big glut of unsold units — especially apartment-style condos, the board predicts.
"While backlogs of all unit types are high, those of apartment suites are particularly worrisome," the report said.
"Indeed, in December, CMHC data showed 1,208 unabsorbed apartments in Calgary and 6,030 unabsorbed apartments across Canada, meaning that one in five unsold Canadian apartments was in Calgary."
Alberta's GDP pegged to grow 2.1%
For the province as a whole, the board predicts real GDP growth of 2.1 per cent in 2018 and 1.6 per cent in 2019, much more modest figures than last year's country-leading growth of 6.7 per cent.
The board says last year's growth was boosted by rising oil production, renewed drilling and several major oilsands projects coming online.
"Growth in energy sector investment will be more subdued, as most of the large projects under way in the oil sands have been, or will soon be, completed," the report said.
Still, the board predicts the continued, if slower, recovery of the oil sector will stimulate a 6.2 per cent increase in investment in machinery and equipment in 2018.
The Canadian Income Survey by Statistics Canada, which also came out Tuesday, says Albertans continue to have the highest median employment income in Canada despite a 6.3 per cent drop in 2016.
The agency says there were 275,000 families and individuals receiving EI benefits in 2016, an increase of 53.6 per cent since the collapse of oil prices in 2014.
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