Small and medium-sized Canadian cities hard-hit by global recession



    OTTAWA, June 16 /CNW Telbec/ - Saint John, New Brunswick stands alone -in
avoiding a recession this year-among 14 small and medium-sized Canadian Census
Metropolitan Areas (CMAs), according to the Conference Board's Metropolitan
Outlook - Summer 2009.
    "The global recession is punishing small and medium-sized CMAs across
Canada," said Mario Lefebvre, Director, Centre for Municipal Studies. "Saint
John is the lone exception. It will lead these cities in economic growth for
the second straight year, although its economy is expected to expand by less
than 1 per cent."
    A relatively healthy services sector will combine with a massive
provincial infrastructure spending plan and tax cuts to keep the economy
afloat. Following real gross domestic product (GDP) growth of 2.9 per cent
last year, Saint John is forecast to post a more modest gain of 0.9 per cent
in 2009.
    Among the remaining 13 CMAs covered in this edition of the Metropolitan
Outlook, Kingston and three Quebec CMAs-Trois Rivières, Sherbrooke and
Saguenay-can expect the smallest economic declines in 2009.

    In Trois-Rivières, difficulties in the manufacturing industry, as well as
soft activity in the services sector, will result in a 0.7 per cent decline in
real GDP and a 5 per cent drop in employment this year.

    With its highly export-oriented manufacturing industry affected by the
deep U.S. recession, Sherbrooke's economy is forecast to decline by 0.8 per
cent in 2009-the CMA's first contraction since 1991.

    Saguenay's real GDP is expected to decline by 1.2 per cent in 2009, due
largely to the struggling aluminum and wood industries. Employment will drop,
as a result, by 2 per cent.

    Kingston's service-oriented economy is forecast to shrink by 0.8 per cent
in 2009. Non-commercial services (education and health care), along with
public administration and defence, are both expected to grow by 4.6 per cent.
On the downside, Kingston's manufacturing sector is on track to record its
ninth straight annual decline in output.

    Elsewhere in Ontario, a turnaround in the manufacturing sector is not
expected until the global economy begins to recover in 2010 at the earliest.
As a result, CMAs such as Oshawa, Kitchener, St. Catharines-Niagara and London
are going through a second consecutive year of declining economic output. The
economies in Windsor and Thunder Bay, meanwhile, are contracting for the third
and fourth consecutive years, respectively.

    Oshawa, struggling with a deep downturn in the automotive sector, is
projected to see real GDP decline by 2.5 per cent in 2009. But the CMA's
medium-term outlook is brighter, due in part to continued strong population
growth. Oshawa is forecast to be the fastest-growing CMA between 2010 and 2013
among those covered in this edition of the Metropolitan Outlook.

    Although real GDP in Kitchener is forecast to decline by 2.6 per cent
this year, the CMA's diverse mix of education, manufacturing and high
technology will produce average annual growth second only to Oshawa over the
medium term.

    An eighth consecutive year of declining manufacturing output, as well as
sluggish tourism activity, will lead to a 2.7 per cent fall in St.
Catharines-Niagara's real GDP this year.

    London's economy is facing a downturn unmatched in recent history. The
struggles in manufacturing industries are spilling over to the services
sector, leading to a decline of 2.8 per cent in real GDP this year.

    Thunder Bay's economy is forecast to decline by 3.1 per cent, the fourth
straight year of falling real GDP. In addition to the weakness in the forestry
industry, a declining population is hurting the services sector and housing
demand.

    With real GDP forecast to fall by 5.6 per cent in 2009, Windsor will post
its third consecutive year of declining output. The struggles in the auto
industry have spread throughout most of the economy, resulting in a slumping
job market and an unemployment rate that is the country's highest among
Canadian CMAs.

    Falling metal prices have sideswiped Sudbury's economy. As a result, real
GDP-which increased modestly in 2008-is projected to decline by 4 per cent
this year.

    St. John's was one of the fastest growing Canadian CMAs in 2008, but its
economy is forecast to decline by 3.6 per cent in 2009. Output in the goods
sector-largely because of lower oil production-will decline by more than 11
per cent. Nevertheless, employment and income will continue to grow this year,
allowing the services sector to maintain growth.

    Abbotsford, the sole western Canadian CMA covered in this edition of the
Metropolitan Outlook, can expect to see its economy shrink for the first time
on record (since 1987) as a CMA. Weak construction and manufacturing output
will contribute to a 1.5 per cent decline in real GDP.




For further information:

For further information: Brent Dowdall, Media Relations, (613) 526-3090
ext. 448, corpcomm@conferenceboard.ca


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