Alberta Tops All Major Economies in "How Canada Performs" Report Card

A+ grade on economic performance ranks ahead of all provinces and peer countries

CALGARY, May 15, 2014 /CNW/ - Alberta has the top-performing economy among the provinces and Canada's international peer countries, according to The Conference Board of Canada's first "How Canada Performs: Economy" report card to compare the 10 provinces and 16 advanced countries. Released today, and building on previous "How Canada Performs" analyses, the Economy report card is the first of six to be produced over the next year on Canadian and provincial socio-economic performance.

Alberta gets "A+" or "A" grades on income per capita, real GDP growth, inflation, employment growth, and the unemployment rate.

"On income per capita, only Alberta gets an "A+" grade. It has an income per capita even higher than that of Norway, a country generally regarded as having one of the highest standards of living in the world," said Glen Hodgson, Senior Vice-President and Chief Economist.

HIGHLIGHTS

• Alberta's income per capita is higher than all other provinces and countries in this analysis.
• Lofty increases in employment and GDP are unlikely to continue in the short term because global commodity prices are not expected to climb significantly.
• Labour productivity in Alberta is high, but growth in productivity was lackluster between 2008 and 2012.
  
  

Alberta's energy wealth has led to huge increases in investment, as well as job and income growth. Gains in real GDP have been strong enough to offset increases in population and keep income per capita high. A rising population tends to put downward pressure on per capita income, and between 1981 and 2013, Alberta's population grew by 76 per cent, the strongest increase in the country.

While Alberta's relative ranking on GDP growth was far from stellar in the 1980s and 1990s, a surge in commodity prices in the mid-2000s helped boost real GDP growth and "A" and "B" grades have reflected that reality.

Alberta, as well as Saskatchewan, will continue to benefit from relatively high prices and demand for their resources. However, it is unlikely that lofty increases in employment and GDP in the 3 to 4 per cent range will continue over the next year or so because global commodity prices are not expected to climb significantly. In Alberta, energy investment will increase at a more moderate pace.

Alberta's energy resources also help its grades on inward and outward greenfield foreign direct investment (FDI)—that is, investment that expands an existing business or creates a new business (as opposed to a merger or acquisition). Alberta scores a "B" grade on both inward and outward greenfield FDI.

While Alberta's labour productivity growth has been somewhat lackluster, its level of labour productivity ranks fourth among the international peers and is highest among the provinces. The main factor driving productivity improvement in the province is capital intensity (investment in plants and in machinery and equipment per hours worked). Alberta is one of only two provinces (Saskatchewan is the other) with higher average capital intensity than the United States.

The Conference Board has expanded its presence in Western Canada with the opening of an office in Calgary last fall. The Conference Board is hosting a Western Business Outlook Conference on Friday, May 23 at The Ranchmen's Club in Calgary from 8 a.m. to 11:45 a.m. Conference Board economists will present economic outlooks for Alberta, Canada and the world, followed by remarks from business and government leaders.

In addition, the Conference Board will host Alberta Business Outlook Webinar on June 26, at 11 a.m. MDT.

How Canada Performs is an ongoing research program at The Conference Board of Canada to help leaders identify relative strengths and weaknesses in Canada's socio-economic performance. The How Canada Performs website presents data and analysis on Canada's performance compared to peer countries in six performance categories: Economy, Innovation, Environment, Education and Skills, Health, and Society.

This is the first year that provincial and territorial rankings are included in the analysis.

The Education and Skills report card will be released in June. 

SOURCE: Conference Board of Canada

Yvonne Squires, Media Relations, Tel.: [phone] ext. 221
E-mail: [email protected]