After the third wave of the COVID-19 pandemic this fall, the Royal Bank of Canada surveyed the damage to our country’s economy. It downgraded the economic growth outlook for every province in the country except one- Alberta. What makes the province different than the others? Let’s find out.
Robert Hogue, a Senior Economist at RBC, said, “Alberta
was the lone exception. We kept our growth forecast in Alberta at 5.9 percent.”
He also mentioned that he expects the province to be the fastest-growing
provincial economy this year and expects that it will top the national GDP
estimate of 5.1 percent.
Alberta seems to be enjoying an economic
resurgence after years of contractions and interrupted recoveries that began since
the oil price crash of 2014. Economists believe that the oil and gas industry
is leading the growth thanks to higher crude and natural gas commodity prices.
It mentioned that the rebound is not limited to higher oil and gas activity
only. Other factors like more real estate investment and growth of
manufacturing and service sectors also play a key role.
The jobless rate is also roughly back to the
pre-pandemic levels. The unemployment was 7.5 percent in Feb 2020, and now it’s
7.6 percent.
Aimee McArthur-Gupta, A Senior Economist at the
Conference Board of Canada, said Alberta “is digging itself out of a pretty big
hole. The Conference Board expects 5.7 percent real GDP growth this year, which
will be followed by 6.1 percent growth next year.
The tech sector of the province is also growing
and offering hope for economic diversification. Amazon Web Services will invest
heavily in a computing hub in Calgary and add 950 new jobs. Capital investments
in the province are also on the rise.
Alberta’s Minister of Jobs, Economy, and
Innovation, Doug Schweitzer, stated, “There are so many reasons to be
optimistic about Alberta’s tech sector.” He also said that the province is
tracking toward “a record year in venture capital and tech investment, creating
thousands of jobs and diversifying our economy.”
The energy and economy sectors of the province
are also growing. Several new hydrogen project announcements have been made.
The province also has the largest number of renewable projects in the country.
This rise in investments is helping other parts of the economy as well.
There has also been a rise in home sales in
Calgary. A record of 2,186 transactions was made in October Sales are up by 61
percent over the average of last five years, according to the Calgary Real
Estate Board. Also, they have increased by 42 percent over the ten-year
average.
Though other industries are growing, most of
the credit for positive projections for Alberta’s economy in 2022 will likely
go to oil and gas revenues, and royalties, as they are hitting new records and
investment in this sector, would likely pick up more.
Alberta Finance Minister Travis Toews said that
oilsands royalties are expected to increase more than 400 percent from an
initial budget estimate of $1.5 billion this fiscal year to over $7 billion. New
numbers are expected to be revealed in the next fiscal update at the end of
November. So, stay tuned!
Learn more about Alberta’s oil and gas industry here.
To know about life in Alberta, click here.
Source:
https://financialpost.com/commodities/energy/oil-gas/albertas-swagger-is-back-and-this-time-its-not-just-an-oil-led-boom