OTTAWA, March 3, 2016 /CNW/ - Quebec's two largest cities are forecast to enjoy healthy economic growth in 2016. Montréal and Québec City can expect growth of 2.3 per cent and 2 per cent, respectively, according to The Conference Board of Canada's Metropolitan Outlook: Winter 2016.
"The depreciation of the Canadian dollar and a healthy U.S. economy is bringing good news to Québec City and Montréal and their export-oriented industries. Economic growth in both cities has been on the upswing. In fact, we expect real GDP growth in both Montréal and Québec City to outpace the national average for the second consecutive year in 2016, after trailing it for five straight years" said Alan Arcand, Associate Director, Centre for Municipal Studies, The Conference Board of Canada.
- Montréal is expected to see real GDP growth of 2.3 per cent in 2016, up from 1.7 per cent last year.
- Québec City's real GDP growth is expected to reach 2 per cent in 2016.
- Vancouver's real GDP is forecast to grow 3.3 per cent, making it the fastest growing economy among the 28 census metropolitan areas covered in this edition of the Metropolitan Outlook.
Montréal's economic improvement will be driven by a strengthening manufacturing sector, a rebound in construction, and steady services sector gains. Manufacturing output is forecast to expand by 3 per cent in 2016, bolstered by the combination of a weaker Canadian dollar and healthy U.S. demand. Two massive infrastructure projects—the $4.2-billion Champlain Bridge and the $3.7-billion Turcot Interchange—will help the local construction industry shake off three straight years of declines. However, a decline in housing starts will limit overall construction output growth to 2 per cent in 2016. Growth among the services-producing industries is projected to be 2.2 per cent in 2016, the same rate as in 2015. All eight industry sectors will advance this year, with the biggest gains coming from the business services sector and the personal services sector.
In all, Montréal is expected to post real GDP growth of 2.3 per cent this year, up from 1.7 per cent in 2015. About 26,000 jobs are expected to be created in 2016. A similar rise in the labour force will keep the unemployment rate at 8.2 per cent, well above the national average of 7 per cent.
The low Canadian dollar and a solid U.S. economy are also boosting the tourism and manufacturing industries in Québec City. The city's accommodation, food services, and retail trade industries should continue to benefit as the weaker loonie makes it cheaper for foreigners to travel in Canada and more expensive for Canadians to travel abroad. Overall, services sector output growth is forecast to improve from 1 per cent in 2015 to 2.3 per cent in 2016. At the same time, manufacturing output is expected to grow by more than 3 per cent this year, its third straight solid gain. The Davie shipyard deal to convert a container ship into a navy supply ship is finally under way, which will provide another source of growth over the next two years. On a less positive note, the provincial government's goal of balancing its books by 2015–16 has resulted in austerity measures that are constraining growth in the provincial capital's public administration sector. Overall, Québec City's real GDP growth is forecast to reach 2 per cent in 2016, similar to the 1.9 per cent recorded in 2015. Some 4,000 jobs are expected to be created this year, down from the close to 8,000 positions created last year.
Released today, Metropolitan Outlook: Winter 2016, is The Conference Board of Canada's once-a-year analysis of 28 Canadian census metropolitan areas (CMAs).
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SOURCE Conference Board of Canada
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