Alberta forecast to lead Canadian economic growth in 2014

By Mario Toneguzzi, Calgary Herald

Alberta led the country in economic growth in 2012 at 3.9 per cent.

Alberta's economy will be second to Newfoundland & Labrabor in terms of 2013 growth before leading the country next year, according to a new RBC Economics forecast.

It said Alberta's real growth domestic product will increase 3 per cent this year, with Newfoundland and Labrador at 5.1 per cent. Nationally, growth is forecast to be 1.8 per cent.

The RBC report says Alberta will best all provinces in 2014 with real GDP growth of 4.2 per cent.

Statistics Canada last week said Alberta, for a second straight year, led the country with growth of 3.9 per cent in 2012, compared with 1.8 per cent across the country.

Todd Hirsch, senior economist with ATB Financial, said Saskatchewan may surpass Alberta this year as the fastest growing provincial economy.

For several quarters, Alberta was losing workers to its eastern neighbour, though the trend appears to be reversing, Hirsch said.

"The push-and-pull between these two Prairie sisters has seen some dramatic movements of people over the decades," Hirsch said.

The trend may now be reversing with the flow of migrants once again shifting to Alberta, he said.

Ben Brunnen, chief economist at the Calgary Chamber of Commerce, said Alberta's growth is very strong. "Looking down the road I think we are going to pull back a little bit," he said.

"The investment numbers and the confidence numbers are just a little bit weaker than we saw last year but with the strong interprovincial migration and the weakness in other parts of the country, we'll still have some tailwinds from that."

RBC forecasts Alberta's unemployment rate to drop from 4.6 in 2012 to 4.4 per cent this year and to 4.5 per cent in 2014. Both those years Alberta will have the second lowest unemployment rate in the country behind Saskatchewan's 4.3 per cent for both years.

Canada is forecast to see unemployment drop from 7.2 per cent in 2012 to 7.0 per cent this year and to 6.7 per cent in 2014.

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