(January 20 – 11:10 ET) – All of the provinces should have a good economic year, say the economists at TD. Canadians can expect more jobs, higher wages, and tax cuts, they say.
“The standard of living of Canadians, which suffered a setback during the 1990’s, is now on a steady climb,” says Derek Burleton, senior economist at TD Bank Financial Group.
TD is forecasting after-tax incomes will rise by more than 5% per year on average in the 2000-2001 period. “This translates into a gain of 2% per year on a real per-capita basis – the strongest advance in Canadians’ living standards since the late 1980’s,” adds Burleton. He says the strongest gains will come in Newfoundland, Ontario and Alberta.
TD says Ontario is still booming. A slowdown in the U.S.should slow manufacturing growth, bbut service industry improvements should more than compensate.
In Quebec manufacturing is expected to prosper, led by the aerospace, biotechnology and
telecommunications industries. The resources, such as forestry and metal mining, will have a better year in 2000 thanks to the ongoing recovery in world commodity prices.
B.C. should benefit from rising Asian demand and stronger commodity prices, although U.S. lumber traffic should slow. Construction will rebound this year, led by a recovery in new home construction. Consumer spending is expected to grow slowly as jobs and wages grow slower than average. Tax cuts will be minimal with B.C. still running a deficit.
Alberta is expected to boom, led by employment growth and increased personal spending as a result. the province’s big surplus should lead to big tax cuts. Manitoba slumped in 1999, thanks to the manufacturing and mining sectors, but both of these sectors are expected to improve in 2000. Spending will likely remain cautious.
In the Atlantic provinces Newfoundland is expected to lead the way as the offshore oil industry comes into production. Although job growth may slow, steep tax cuts are expected. TD sees Newfoundland leading the country in living standards improvement.
PEI should be slower this year after a good 1999. Nova Scotia should also slowdown a little as the Sable Island natural gas project and pipeline is completed. The lack of flexibility for tax cuts should keep standards flat. The same situation follows in New Brunswick, although mining and forestry should help make up for some of that slowdown. Tax cuts are anticipated here too.
-IE Staff