Atlantic Canada’s economy has “wind in its sails” and is poised for an economic breakout, according to a new report from the Ottawa-based think-tank Public Policy Forum.
The report, entitled the Atlantic Canada Momentum Index, says that Canada’s East Coast provinces are experiencing “historic” momentum, in large part because of population growth.
“It’s ‘have not’ no more,” said president and CEO Edward Greenspon. “Atlantic Canada did lag on a number of indicators in a lot of ways for years. But that’s not true anymore.”
The think-tank measured 20 metrics, including measuring economic and population growth, level of education, immigration numbers, median age and employment rate. It based provinces’ performance on how many of these indicators improved between 2015 and 2022.
It found Atlantic Canada is performing comparably to the national average, and that it is showing a significant improvement compared to its performance from 2008 to 2015.
“I am proud,” said Wade MacLauchlan, former P.E.I. premier and one of 17 former Atlantic Canadian premiers and deputy premiers who signed on to the report.
“This is something that I and hundreds of thousands of others have worked hard for over generations. And there is a real sense of accomplishment and something on which we can build and grow.”
But some Atlantic Canadians say this report doesn’t tell the whole story: they say they’re squeezed by skyrocketing housing costs, as population growth and increased wealth creates a strain on the existing housing stock.
Edward Greenspon, President and CEO of Public Policy Forum, says that Atlantic Canada should do what it can to capitalize on recent economic growth. (Public Policy Forum)
Population propelling economic growth
Atlantic Canada’s population declined five decades in a row in proportion to the rest of Canada.
That tendency is shifting.
“For the first time, you’re beginning to see population growth,” said Greenspon.
Recent census numbers show the country’s fastest-growing cities — Halifax and Moncton — are in the Maritimes.
Much of that population growth is spurred by people like Pauline Landriault, an Ontario resident who is able to work remotely. She has a property in Nova Scotia and is hoping to move there permanently.
“There’s a lot of people who bought places here during the pandemic,” she said. “With the nature and the trails, it’s the most beautiful province in the country. It’s a hidden gem.”
The Atlantic bubble, which allowed unrestricted travel within the East Coast provinces for a period during the COVID-19 pandemic, may have also made the province attractive to people looking to relocate during the pandemic, according to former Nova Scotia premier Stephen McNeil.
Ontario resident Pauline Landriault said she’s planning a permanent move to Nova Scotia, calling the province a ‘hidden gem.’ (David Laughlin/CBC)
McNeil said his province was beginning to see more jobs creation around 2015, and shifted focus toward attracting more people back to Atlantic Canada to fill those jobs.
He said his government fought the long-held belief that Maritimers must give up career advancement aspirations if they choose to stay out East.
“We can do all the economic stuff right, but if we don’t have people, then we’re doomed,” he said. “We’re as close to New York as Toronto is, but we’re more affordable.”
Immigration is also booming in Atlantic Canada: the average number of immigrants in Atlantic Canada from 2008 to 2015 was about 7,000 per year. From 2015 to 2022, that average more than doubled, to about 15,000 immigrants per year.
The median age of Atlantic Canadians, while older than the national average, has slowed in its growth.
“There’s a growth in confidence, in population and economic activity. In many ways, this is for Atlantic Canadians, the opportunity to say after 130 years of outmigration, let’s try something else,” MacLauchlan said.
Halifax resident Melissa Gazzard receives social assistance and said the rising housing costs make it very difficult for her to find long-term housing. (David Laughlin/CBC)
With more prosperity, new challenges
Though the Public Policy Forum report does track the number of new housing builds in a region, it does not track the current costs of housing in Atlantic Canada, which have soared in recent years.
Halifax resident Melissa Gazzard relies on social assistance to pay her bills, and she said increased cost of housing has made it extremely difficult to find a long-term home.
“They’re leaving us that are out here to basically fend for ourselves,” she said. “It’s really hard. They put us in one circle, and say, ‘OK, we’ll deal with you later.’ But it never gets dealt with.”
One of the other metrics measured was access to a family physician, an area where Atlantic Canada continues to struggle.
Nearly 370,000 Atlantic Canadians don’t have a family doctor and the report shows that provinces have not made improvement in decreasing this number.
“There’s new challenges and problems. There’s problems around health care and access to physicians,” said Greenspon.
“There’s always going to be some people left behind, and policy needs to address that and make sure they don’t fall through cracks,” he said.
Former Nova Scotia premier Stephen McNeil, shown here speaking to reporters outside Province House on Oct. 13, 2020, is one of 17 former Atlantic Canadian premiers and deputy premiers who signed on to the report. (Jean Laroche/CBC)
How to keep building?
For momentum to keep growing in Atlantic Canada, it needs to be fostered, the report concludes.
“It would be negligent to let this swelling momentum pass without putting the necessary policy supports in place to perpetuate it,” it reads.
The think-tank says it will meet with policymakers to discuss policies to build on the momentum.
“The message that I think is most important is to really recognize we can raise our expectations and that we should keep going. Because this is working and it is good for us,” said MacLauchlan.
McNeil, who left office in 2021, said he expects the trend will continue upward.
“Atlantic Canada is alive and well, and quite frankly, a global player,” he said.
TORONTO – Canada’s main stock index was higher in late-morning trading, helped by strength in energy stocks, while U.S. stock markets also moved up.
The S&P/TSX composite index was up 34.91 points at 23,736.98.
In New York, the Dow Jones industrial average was up 178.05 points at 41,800.13. The S&P 500 index was up 28.38 points at 5,661.47, while the Nasdaq composite was up 133.17 points at 17,725.30.
The Canadian dollar traded for 73.56 cents US compared with 73.57 cents US on Monday.
The November crude oil contract was up 68 cents at US$69.70 per barrel and the October natural gas contract was up three cents at US$2.40 per mmBTU.
The December gold contract was down US$7.80 at US$2,601.10 an ounce and the December copper contract was up a penny at US$4.28 a pound.
This report by The Canadian Press was first published Sept. 17, 2024.
OTTAWA – Canada’s inflation rate fell to two per cent last month, finally hitting the Bank of Canada’s target after a tumultuous battle with skyrocketing price growth.
The annual inflation rate fell from 2.5 per cent in July to reach the lowest level since February 2021.
Statistics Canada’s consumer price index report on Tuesday attributed the slowdown in part to lower gasoline prices.
Clothing and footwear prices also decreased on a month-over-month basis, marking the first decline in the month of August since 1971 as retailers offered larger discounts to entice shoppers amid slowing demand.
The Bank of Canada’s preferred core measures of inflation, which strip out volatility in prices, also edged down in August.
The marked slowdown in price growth last month was steeper than the 2.1 per cent annual increase forecasters were expecting ahead of Tuesday’s release and will likely spark speculation of a larger interest rate cut next month from the Bank of Canada.
“Inflation remains unthreatening and the Bank of Canada should now focus on trying to stimulate the economy and halting the upward climb in the unemployment rate,” wrote CIBC senior economist Andrew Grantham.
Benjamin Reitzes, managing director of Canadian rates and macro strategist at BMO, said Tuesday’s figures “tilt the scales” slightly in favour of more aggressive cuts, though he noted the Bank of Canada will have one more inflation reading before its October rate announcement.
“If we get another big downside surprise, calls for a 50 basis-point cut will only grow louder,” wrote Reitzes in a client note.
The central bank began rapidly hiking interest rates in March 2022 in response to runaway inflation, which peaked at a whopping 8.1 per cent that summer.
The central bank increased its key lending rate to five per cent and held it at that level until June 2024, when it delivered its first rate cut in four years.
A combination of recovered global supply chains and high interest rates have helped cool price growth in Canada and around the world.
Bank of Canada governor Tiff Macklem recently signalled that the central bank is ready to increase the size of its interest rate cuts, if inflation or the economy slow by more than expected.
Its key lending rate currently stands at 4.25 per cent.
CIBC is forecasting the central bank will cut its key rate by two percentage points between now and the middle of next year.
The U.S. Federal Reserve is also expected on Wednesday to deliver its first interest rate cut in four years.
This report by The Canadian Press was first published Sept. 17, 2024.
FREDERICTON – New Brunswick‘s finance minister says the province recorded a surplus of $500.8 million for the fiscal year that ended in March.
Ernie Steeves says the amount — more than 10 times higher than the province’s original $40.3-million budget projection for the 2023-24 fiscal year — was largely the result of a strong economy and population growth.
The report of a big surplus comes as the province prepares for an election campaign, which will officially start on Thursday and end with a vote on Oct. 21.
Steeves says growth of the surplus was fed by revenue from the Harmonized Sales Tax and federal money, especially for health-care funding.
Progressive Conservative Premier Blaine Higgs has promised to reduce the HST by two percentage points to 13 per cent if the party is elected to govern next month.
Meanwhile, the province’s net debt, according to the audited consolidated financial statements, has dropped from $12.3 billion in 2022-23 to $11.8 billion in the most recent fiscal year.
Liberal critic René Legacy says having a stronger balance sheet does not eliminate issues in health care, housing and education.
This report by The Canadian Press was first published Sept. 16, 2024.
