The environment: a growth catalyst for the Quebec economy
- For the first time this year, in addition toadding environmental variables to the analysis, the Index measures the health of Quebec's economy against the country as a whole.
- The health of the Quebec and Canadian economies has improved by 22.96% since 1980.
- An index composed of 30 variables divided into five thematic groups to better analyze the Quebec economy's various strengths and weaknesses
- An analysis based on over 37 years of data (1980-2017)
- A methodology validated by a group of Quebec economic experts
MONTREAL, June 11, 2019 /CNW/ - Today PwC Canada unveiled the 2019 edition of its Quebec Economic Health Index. For this latest edition the analysis included a new thematic group, the environment, and it now examines how Quebec's economic health is faring compared to Canada's. This third edition of the Index is unique, provides a global assessment at a point in time, and is "analytical-reflective." It is focused on the following questions: how does the environment affect Quebec's economy, and what can we do to make our economy more resilient in the face of climate challenges?
According to this year's Index, the health of the Quebec and Canadian economies improved by 22.96% in the period from 1980 to 2017. Since Quebec is a major contributor to the Canadian economy, changes in the health of its economy directly affect the health of the country as a whole. These two economies have followed a similar trend since 1980 and are now at much the same levels, although there have been some differences, particularly during periods of recession.
Economic growth depends on the environment
"This third edition of the Index will undoubtedly stimulate discussion, open up new ways of thinking about the health of the economy and help us mobilize around the factors that influence it," said Sonia Boisvert, Partner at PwC Canada. "This view of the health of the Quebec and Canadian economies provides new information, for an even more compelling analysis. The environment continues to play a growing role in our economic reality. In fact, the results of the 2019 edition of the Index, and in particular those for the 2010-2017 period, show that environmental concerns can be reconciled with economic growth. In other words, adding this group to our analysis was essential to gaining a full understanding of how its variables can affect the health of the Quebec and Canadian economies."
"Adding the Environment group has made it possible to consolidate the robustness of the Index through a more broad-based analysis of the underlying trends in the Quebec and Canadian economies," added Alain Robichaud, Consulting Services at PwC Canada. "The role played by this group is only expected to grow over time. Moreover, it is clear that the balance is still precarious, and that we must act on various variables to restore it. The structural nature of this index highlights the challenges and benefits of the energy transition, as well as the degree to which the environment is an integral part of the economy. This specific point of view is sure to stimulate valuable discussions among the public, entrepreneurs and investors, as well as public authorities and help identify where efforts need to be made to achieve economic and social gains."
Main findings for 2019
Four variables contributed more than 70% to improving the health of the Quebec economy and more than 60% to the Canadian economy. They are:
- GDP/population of 15-to-64 year-olds;
- Post-secondary graduation rate (total population);
- Fixed capital stock per capita (infrastructure);
- Spending on research and development.
The environment also helped strengthen the Quebec economy. For example, from 1980 to 2017 this group contributed 5.2% to the increase in the Quebec Economic Health Index, at a time when it had virtually no effect on the Canadian economy as a whole. It is worth noting that since 2010 the relative contribution of environmental variables has changed, bringing their contribution to 20.5% for the Quebec economy over the 2010-2017 period, while they have held back the Canadian economy by 0.9%.
Once again this year, we found that the Investment and Human Capital groups made the largest contributions to the health of the Quebec and Canadian economies throughout the period analyzed. However, it is important to note that the groups driving better health changed from one sub-period to the next. The variables in the Investment group generally buoyed the Index during the 1980s and 1990s, while the variables in the Human Capital group played a growing role up until the crisis. Thereafter, the Growth group was clearly dominant in Quebec, from 2010 to 2017. There was also a significant rebound in the influence of the Environment group that made Quebec's economy stronger during the period.
For more on conclusions drawn from the Index, see: https://www.pwc.com/ca/en/industries/public-sector-government/health-index.html
About the Quebec Economic Health Index
The Index comprises 30 variables divided into five thematic groups (Industrial Demographics, Investment, Growth, Human Capital and Environment) that actively participate in the health of the economy. It provides an overview of the economy and captures its strength. The objective is to foster discussion and rally stakeholders around the issue of Quebec's and Canada's economic health, as well as to involve all the major actors, including institutions, governments and private businesses.
The Index uses the same methodology as that used by Canada's leading economic institutions. It was developed by a PwC Canada team in collaboration with an economist specialized in the Quebec economy. A committee of economic experts also collaborated on developing the approach.
About PwC Canada
At PwC, our purpose is to build trust in society and solve important problems. More than 7,000 partners and staff in offices across the country are committed to delivering quality in assurance, tax, consulting and deals services. PwC Canada is a member of the PwC network of firms with more than 250,000 people in 158 countries. Find out more by visiting us at www.pwc.com/ca.
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SOURCE PwC (PricewaterhouseCoopers)
For further information: Youann Blouin, Manager, Public Relations, PwC Canada, Tel.: +1-514-205-5433, email: [email protected]