OTTAWA, March 13, 2018 /CNW/ - The economy of St. John's, Newfoundland and Labrador, is forecast to rebound this year, posting 2.5 per cent real GDP growth. By contrast, Halifax, Moncton, and Saint John, New Brunswick should experience modest real GDP growth below 2 per cent this year, according to The Conference Board of Canada's Metropolitan Outlook: Winter 2018.
"The St. John's economy has struggled in recent years, but it is poised to be a growth leader in 2018 thanks to increased offshore oil production," said Alan Arcand, Associate Director, Centre for Municipal Studies, The Conference Board of Canada. "Economic growth in Halifax and Moncton will remain steady but modest in 2018, while the Saint John economy is expected to slow significantly this year."
- Along with Vancouver and Abbotsford-Mission, St. John's, Newfoundland and Labrador will be an economic growth leader in 2018.
- Economic advances in Halifax and Moncton will remain steady but modest in 2018, with the former expanding by 1.7 per cent and the latter growing by 1.6 per cent.
- The Saint John economy is expected to slow significantly this year, growing by just 0.8 per cent.
- Vancouver is forecast to be the fastest growing census metropolitan area (CMA) in Canada this year, although real GDP growth is forecast to moderate to 2.7 per cent.
The start of production at the new Hebron offshore oil field late last year will provide a boost to St. John's economy lifting real GDP growth to 2.5 per cent in 2018, following contractions in two of the past three years. The city's primary, resources and utilities sector is set to grow by an annual average of 11.0 per cent over the next two years. Still, weakness will persist in other areas of the economy, including construction and many services sectors, both of which are expected to contract this year. Despite the rebound in economic growth, employment is expected to decline for the third time in four years in 2018.
For the second year in a row, Halifax's real GDP will grow by 1.7 per cent in 2018. Ongoing work at the Halifax Shipyard, together with strength in private services, will offset a decline in primary, resources and utilities output as production of offshore natural gas winds down. Employment in the Halifax region is poised to grow by 1.1 per cent this year, an improvement over last year's decline. This will help lower the unemployment rate from a 15-year high of 6.9 per cent last year to 6.5 per cent over the next two years.
Moncton's real GDP is expected to increase by 1.6 per cent this year, on par with the CMA's average annual gains over the past two years. Growth is expected to remain solid in both manufacturing and in primary, resources and utilities. This will offset a modest contraction in the construction sector due to the winding down of number of major non-residential projects, including the new downtown entertainment and sports centre and the Junction, a mixed-use project at the old CN railway yards site. Employment in Moncton is finally showing signs of improvement and is expected to increase by 2.8 per cent this year, bouncing back from two consecutive annual declines.
Following three years of growth averaging 3.0 per cent, real GDP in Saint John is forecast to rise a much more modest 0.8 per cent this year. Output growth in manufacturing, and primary, resources and utilities will be hampered by higher U.S. softwood lumber tariffs. Meanwhile, construction output is expected to contract in 2018 as housing starts stall and key non-residential projects wrap up. This will be a temporary dip, however, as modernization of the Port of Saint John will buoy the construction industry next year. On the services side, falling employment, moderating income gains, along with rising interest rates and high household debt, will weaken consumer-oriented industries this year, including wholesale and retail trade, accommodation and food services, and arts, entertainment, and recreation.
Released today, Metropolitan Outlook: Winter 2018, is The Conference Board of Canada's once-a-year analysis of 29 Canadian census metropolitan areas.
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SOURCE Conference Board of Canada
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