P.E.I. leading region in economic performance
'If you have more people eventually you need more schools, bigger hospitals, more roads'
A new report from the Atlantic Provinces Economic Council shows P.E.I. out in front on economic indicators, but an economist there is beginning to ponder the limits of growth.
Highlights of the Island's economy include:
- Manufacturing shipments: up 21 per cent for year-to-date.
- Urban housing starts: up 32 per cent for year-to-date.
- Retail sales: up 2.6 per cent for year-to-date.
- Employment: up 2.2 per cent from July 2018 to July 2019.
For years the province has delivered strong economic growth, driven largely by population growth, which has in turn been driven by immigration.
"We're continuing to see population gains on the Island, which will of course lead to more construction, more spending, more employment," said Fred Bergman, senior policy analyst with APEC.
That immigration has had P.E.I. leading the country in population growth, Bergman said, at about two per cent a year from 2016 to 2018. And immigration continues to grow, up almost 13 per cent in the first half of 2019.
But Bergman cautions there are limits to this growth.
"If you have more people eventually you need more schools, bigger hospitals, more roads and so on," he said.
"The infrastructure is going to have to catch up with the strong population growth, but there could be limits in terms of capacity. How much can they build to keep up with the population growth, or will they shed some people because the infrastructure can't meet their needs."
Bergman said the Island already has a low retention rate for immigrants, with about half leaving the Island in their first year.
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With files from Angela Walker