OTTAWA, May 14, 2015 /CNW/ - Prompted by the slump in oil prices, Regina's economic growth will slow to 1.9 per cent this year, down from 5 per cent in 2014, according to The Conference Board of Canada's Metropolitan Outlook: Spring 2015.
"The collapse in oil prices has significantly altered the economic outlook among Canada's largest cities. The dramatic reversal of fortune will see long-standing growth leader Regina near the bottom of the pack this year," said Alan Arcand, Associate Director, Centre for Municipal Studies. "Economic growth should pick up next year but remain modest by historical standards."
- Regina's economic growth will dampen, but the city will avoid a recession.
- The construction industry will remain a bright spot in Regina's economy.
- Hit hard by the slump in oil prices, the economies of Calgary and Edmonton are expected to shrink by 1.2 per cent and 0.8 per cent, respectively, this year.
The city's goods-producing industries will expand much more slowly in 2015, primarily as a result of weakness in the resources, agriculture and utilities sector. In addition, lower oil prices will cut gains in the services sector in half this year.
The construction industry will remain a bright spot in Regina's economy. Construction output in the city is set to rise by 6 per cent in 2015, thanks in part to work on a new stadium to house the Saskatchewan Roughriders and an upgrade of the city's sewage treatment plan.
Local employment growth, which had already cooled to a lacklustre 0.4 per cent in 2014 from a blistering 6.2 per cent in 2013, will reach only 0.6 per cent in 2015. This will raise the unemployment rate a full percentage point to 4.7 per cent, pointing to a loosening of the area's tight labour market.
Aside from Calgary, Edmonton, Saskatoon and Regina, most of the 13 CMAs covered in the report will see their economic fortunes improve this year, boosted by the lower prices for oil, a weaker Canadian dollar, and improvement in the U.S. economy. Toronto, Vancouver, and Halifax will be the fastest growing metropolitan economies in the country this year, with each posting growth of 3.1 per cent.
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SOURCE Conference Board of Canada
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