Tell me about Edmonton’s economic landscape.
Edmonton has been impacted by the global economic downturn, but the impact has been different than in most jurisdictions. The downturn brought an end to almost two decades of sustained economic growth. More recently Edmonton experienced three years of greater than 5% economic growth making it one of Canada’s leading municipalities for economic growth.
With the boom over, Edmonton’s overheated economy has returned to a more normal state. While the unemployment rate has risen with the downturn because Edmonton continued to attract new workers, the current rate of 7.6% is below the Canadian average.
With the downturn the inflation rate cooled, construction slowed appreciably (both residential and non-residential) and housing prices declined. However signs of a turn-around are now evident as construction is picking up, as are housing sales and prices.
Renewed growth in construction will help real gross domestic product in Edmonton expand by 2.9 per cent this year, according to the Conference Board of Canada’s Metropolitan Outlook – Spring 2010.
Edmonton is well positioned for future economic growth. Canadian demographic trends indicate that the current increase in the unemployment rate will reverse as Edmonton and Alberta will need more workers in the future to cope with the aging population. Debt loads for the City of Edmonton and Province of Alberta are small providing the capacity to support the infrastructure requirements needed to sustain future economic growth. With high income levels and personal and corporate tax rates that are among the lowest in Canada, Edmonton’s residents have more purchasing power which will also aid its recovery.
The pace of Edmonton’s return to strong economic growth will be strongly influenced by outside forces, specifically world prices for oil and gas. At today’s rates we can expect steady but moderate growth, but an increase in today’s prices for oil and gas is likely to spur a more rapid rebound.
