As Alberta’s economy continues to improve, provincial lender ATB Financial says the pace of growth will be slower than Albertans are used to.
Not that it’s all bad news; the province is seeing some positive signs among non-energy sectors and there is also growth in employment and the housing market.
But the 4.9% pace of growth in 2017, which made Alberta the fastest growing province in Canada, will not be repeated in 2018 with real GDP expected to grow 2.7% this year and 2.3% in 2019.
That growth will be led by non-energy sectors as while oil prices are rising, the energy sector is still lagging on investment and there are the pipeline concerns weighing on the sector.
“Risks with respect to oil prices remain including the ongoing opposition to pipeline expansion,” said Todd Hirsch, ATB Financial’s Chief Economist. “If there is no resolution—or worse, a negative outcome on pipeline projects—the short- and medium-term outlook for the sector will dim.”
Overall, Hirsch says that sentiment and empirical data are telling contrasting stories.
“In considering the latter, it’s clear that our province’s economy is expanding—but in new ways and at a more moderate pace than many Albertans are used to. For those people who are still without jobs and facing financial hardship as a result of the downturn, it continues to be a tough time, despite what the data are telling us,” he says.
Jobs are being created but in low-wage roles
The rise in employment in Alberta is welcome, but many of the new roles being created are in low paying sectors and in part-time roles.
However, there are signs that burgeoning non-energy sectors will mean new opportunities for prosperity ahead.
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