BC Exports in 2016: Five Points of Interest
BC is a small, open, trade dependent economy. As such, exports play a big role in underpinning prosperity and stimulating growth. When exports rise, BC’s economy generally strengthens. Given the dominant role that natural resources have in BC’s overall export profile, exports are also the backbone of many smaller communities around the province.
5 Points of Interest about BC’s Labour Market
The BC job market is very healthy and employment is growing at a robust pace. Statistics Canada’s Labour Force Survey shows that between September and October of this year BC gained another ~15,000 jobs, further underscoring the fact that BC stands out in the federation on most key labour market metrics.
BC Tops the Provinces in Economic Growth in 2015
Bolstered by the lower dollar, inward migration, and a hot housing market, BC’s economy grew by a solid 3.0% (after adjusting for inflation) in 2015. This was the strongest expansion since 2006, although just slightly above 2014’s healthy 2.9% gain.
BC's Fastest Growing Industries Come from a Diverse Mix of Sectors
Amid the steep downturn in global commodity markets, the BC economy has held up surprisingly well. Two decades ago, a comparable world-wide mining/energy downturn would have meant malaise for the provincial economy. But what we see now, notwithstanding some regional challenges, is an economy that is on a solid growth footing.
A Healthy Increase in Newly Incorporated Companies in BC
Last year saw a total of 37,934 new incorporations in the British Columbia, a record high that amounted to an 8.5% increase in the number of newly incorporated businesses. This follows a similar-sized gain in 2014.
Population Growth Varies Widely Across BC
In recent years BC’s population has expanded roughly in line with national population growth. Between 2011 and 2015 the number of BC residents rose at an average annual pace of 1.0%, essentially the same as Canada. Alberta led the way, with the number of people living in that province surging at an average rate of 2.6% over the past four years. Population growth in Saskatchewan (1.5%) and Manitoba (1.2%) also outpaced BC. Population growth rates in BC and Ontario have been virtually identical.
Consumers Helping Drive Growth in BC
Propelled by strong spending growth, the total value of retail sales in BC surpassed the $70 billion mark in 2015. Sales at stores, malls and shops are growing at a healthy clip and are a significant factor underpinning BC’s solid overall economic performance.
Net In-migration to BC Picks Up in Q3…While Alberta Goes the Other Way
Migration across Canada tends to exhibit strong seasonal patterns, so to compare the movement of people over time the data can be seasonally adjusted or one can simply compare the third quarter data to third quarter flows from past years. Looking just at the 2015 third quarter data highlights the most recent increase, with BC gaining a net inflow of 6,315 people from other provinces. In comparison, in the third quarter of 2014 BC recorded a gain of about 3,600 interprovincial; back in 2013 we added 1,800.
10 things to watch for in 2016
Last December, we compiled a list of ten things to watch for in 2015, with a focus on those expected to impact the provincial economy. This year we are again compiling a list of trends and developments we believe will shape the BC economy in 2016.
BC Consumers Are Out Spending
Retail spending in BC continues to grow at a healthy pace. Just released data from Statistics Canada shows retail sales in September were up 6.0% over the same month last year. This is the strongest annual gain among the provinces and stands in sharp contrast to Alberta’s 5.6% drop in retail spending.
BC Job Market is Almost Certainly Stronger than Labour Force Survey Suggests
It has been somewhat challenging making sense of BC’s job market over the past couple of years. So far in 2015, Statistics Canada’s Labour Force Survey (LFS) shows overall job growth in the province running at a modest 0.8%, based on year-to-date data through September. Looking just at payroll employment (that is, taking self-employment out of the total job count), the number of employees is up by meagre 0.2% year-to-date, according to the LFS. The difficulty is that this puny increase in the number of employees is not consistent with other economic indicators for BC, such as strong gains in retail spending, a buoyant housing market, and a busy construction sector.
BC Net Interprovincial Migration Trending Higher
In the second quarter of2015 BC saw a net inflow of nearly 4,000 people moving here from other Canada jurisdictions. While this figure is down from the 5000+ net inflow in Q2 of 2014, it is up significantly from the 2012-2013 era.
PART TWO: Municipal Tax Burden Varies Widely Across Smaller BC Communities
This is the second blog documenting the level and growth of municipal property taxes in BC, using data compiled and reported by the Ministry of Community, Sport and Cultural Development. The first blog examined property taxes for larger municipalities with populations in excess of 10,000. This follow up piece looks at the level and growth of per capita taxes for municipalities with populations between 2,000 and 10,000.
Labour Market Conditions Ease in the Prairie Provinces But Tighten in BC
Labour market conditions in Western Canada have changed significantly in the past year or so. Amid the dramatic fall in oil prices and generally soft prices for many other key commodities, the ranks of the unemployed have increased in all three Prairie Provinces in recent quarters. Consistent with a rise in unemployment, the number of job vacancies in each of the three Prairie provinces has dwindled. In BC, however, these labour market metrics have been the reverse: the number of unemployed has remained stable or edged down while job vacancies have climbed.
PART ONE: Municipal Tax Burden Varies Widely in BC and Continues to Outpace Inflation
The Ministry of Community, Sport and Cultural Development compiles data on local government finances, including figures on per capita levels of property tax. What is discussed below and shown in the graphs is the total amount of tax levied on all nine property classes, as defined in provincial legislation. This provides a gauge of the overall tax burden in each municipality, with the per capita data allowing comparisons to be made across municipalities of different sizes. To make such comparisons more meaningful, the figures below show per capita taxes just for municipalities with populations that exceed 10,000. Taxation in smaller municipalities will be discussed in subsequent blog posts. The first figure shows the 2015 per capita levels of property taxes for BC’s larger municipalities. The additional numbers on the right side of the chart are the average annual growth rates of per capita taxes in each municipality over the past three years, and are included in the graph for quick reference.
Solid Gains in Retail Spending Suggest British Columbians are Optimistic
Following an unusually weak period in 2013, retail spending in BC has steadily strengthened and is now growing at the strongest annual pace since the 2010 Olympics. The total value of retail sales surged in May by 8.3% over the same month of last year. What’s more, BC is now leading the country in the growth of retail sales at a time when activity has slowed markedly in some other provinces. In Alberta and Saskatchewan retail sales are now well below year-ago levels, even on a non-inflated adjusted basis. Canada-wide growth in retail sales is running around 2.5%. Sales in BC are growing at about three times the national pace. Ontario is quite closely aligned with BC as retailers there are seeing spending growth of about 5%.
Q1 Net Inflow of People to BC from Other Provinces the Strongest in Two Decades
BC’s comparatively healthy economic performance and attractive climate are luring people from other parts of Canada at a rate not seen in many years.
Migration has well established seasonal patterns, so to compare the movement of people over time the data can be seasonally adjusted or one can simply compare first quarter data to first quarter results from prior years. For simplicity, the graphs and analysis below adopt the latter approach and examine Q1 migration flows to BC for the years 1988 through 2015.
BC Now a Growth Leader in Canada
According to recently released data from Statistics Canada, the BC economy grew by 2.6% in 2014. Against the backdrop of sluggish commodity markets, sub-par global growth and ongoing turbulence in Europe and some emerging economies, this is very respectable showing. In historical terms, it is just slightly ahead of the province’s 2.5% long-term average growth rate. And measured against other provinces, our economic expansion was second among the ten provinces last year.
Digital Infrastructure will continue to transform the Way People Work and Interact
The internet and wireless communication networks have become an essential part of society’s infrastructure in the 21st century. It has altered the way people work and interact and the way businesses operate and serve customers. And the transformation has been very rapid considering that in less than two decades the commercial internet has become fundamental to business operations. Already about 2.5 billion people are connected to the internet, a third of the world’s population; projections point to 4 billion users by 2020, equal to more than half of the global population
Rising Exports will Support Strong Economic Growth in BC
Exports are vital to sustaining and increasing BC’s standard of living because they allow us to pay for imports of goods and services not produced locally, they support hundreds of thousands of jobs, and they provide local firms with opportunities to grow and benefit from economies of scale. The discipline of having to compete in the international marketplace encourages firms to invest in productivity enhancing equipment and processes. In turn, this means that export-oriented industries tend to have above-average levels of productivity and therefore are able to pay above-average wages/benefits.