Energy is the fuel and engineering is the machine that keeps Alberta’s economy running in high gear, says a BMO report.
Business dynamism in Calgary and southern Alberta continues, says Mike Darling, southern Alberta regional vice president of Commercial Banking at BMO. “Oil and gas companies still dominate the scene, but we see significant opportunity for firms that support the industry spinoffs. This particularly applies to the engineering sector.”
Alberta’s GDP will increase to 3.5% in 2014, says BMO Capital Markets senior economist Robers Kavcic; that growth is 1.2 points above the national average. Kavcic says 2015 growth will again surpass 3%—the only province in Canada to do so.
Employment growth in the province will stay near 4%, compared to minimal growth in the rest of the country. That is up from 1.7% last year and 2.6% in 2012. “The province’s healthy labour market continues to draw a significant number of migrants from other parts of the country,” says Kavcic. As a result, Alberta’s population growth surged 3.5% year-over-year, which is the fastest in more than 30 years.
“With any supply overhang from the pre-recession building boom all but absorbed and continued population growth, we expect the construction sector to experience a period of growth in the year ahead,” he adds.
And capital spending in the oil and gas sector should increase to 3.5% in 2014, says Kavcic. There will also be an increase in capital spending related to infrastructure.