About Western Canada
Canadian Context
The Canadian economy is expected to grow by an average of 3 per cent between 2006 and 2007.
Despite the underperformance of the manufacturing sector due to continued restructuring, the overall outlook for the economy is quite healthy. Domestic demand is forecasted to remain strong in 2006 as real wage gains and better job growth maintain a high level of consumer confidence. However, overall consumer-spending growth will not maintain its 2005 level, resulting in a positive personal savings rate. Residential construction will ease off from the very high 2005 levels.
The rising Canadian dollar will continue to limit growth in exports of finished goods and services while increasing imports, including machinery and equipment to improve manufacturing productivity. Strong investment into the resource sector will continue. Despite the forecast for lower energy prices, profitability remains solid, providing incentives to invest.
Western Outlook
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Quick facts about British Columbia | Alberta | Saskatchewan | Manitoba.
Additional Economic Research and Studies on economic issues important to Western Canada.
The West - particularly British Columbia and Alberta - will stand out once again in terms of economic growth during 2006 and into 2007. This growth is fuelled by booming residential and industrial construction, which shows no signs of slowing down. Manitoba and Saskatchewan will both benefit from improved grain and oilseed crop quality and from rising cattle exports.
In BC, the economic growth rate is expected to exceed 3 per cent in 2006 and 2007, a forecast supported by public sector infrastructure projects for the 2010 Olympics. These projects created 68,000 new jobs last year and will provide a solid foundation for future economic growth.
In 2006, the growth rate of the Alberta economy is expected to surpass 4 per cent for the third consecutive year. The provincial government's $400 prosperity bonus added fuel to an already robust economy. High energy prices and an escalating demand for petroleum products are stimulating the energy sector. In turn, the revenue and growth generated by the energy sector is contributing to the boom of the construction industry and having spin off effects throughout the economy. Solid wage increases and job creation will continue to support substantial gains in the domestic economy. In BC, as well as Alberta, increasing worker and skills shortages are beginning to limit economic growth potential.
In Saskatchewan, economic growth will be more broad-based, with GDP growth projected at 2.5 per cent for 2006-2007. The overall forecast for the mining industry is quite positive, as is increasing demand for uranium, oil and natural gas. However, there is a risk that high potash inventories will slow extraction.
The Manitoba economy will be supported by continued gains in the wholesale and retail trade and a revival in the agriculture industry. This will push GDP growth to 3 per cent in 2006 and 2.8 per cent in 2007. With several non-residential capital projects underway, the construction industry will also stimulate economic growth over the next two years.