Canada’s economy has shown notable sturdiness in recent years, despite global headwinds, save one spot: New Brunswick.
A pair of reports out Monday show just how pronounced the slowdown has been in the Atlantic province. New Brunswick’s economy didn’t budge at all last year, compared with 2.6-per-cent growth in gross domestic product nationally, Statistics Canada’s provincial accounts show. It was the slowest performance of all provinces. The agency pins the anemic growth on shrinking business investment (which has fallen three years in a row), falling government outlays and a contraction in international trade.
In fact, “New Brunswick has been unable to generate any significant economic growth since 2010,” says the Conference Board of Canada in a separate study on the outlook for the provinces.
Employers haven’t been adding to payrolls and consumers are still cautious about spending, it says. As a result, the province’s real GDP isn’t expected to grow more than 0.5 per cent this year. This would give it the dubious distinction of the country’s second-slowest provincial economy after Newfoundland, which is set to contract due to falling metal prices and maintenance in the oil industry.
New Brunswick has “hobbled through” the past two years, with “back-to-back annual job losses, dismal levels of consumer spending and weak private and public investments,” the outlook notes.
There are brighter signs on the horizon, though. PotashCorp. is boosting production at its Sussex mine and has expanded its processing plant. The U.S. housing market is finally perking up, and a broader U.S. recovery will heighten demand for the province’s exports, the Conference Board says. The pickup in natural resources and manufacturing will lower the province’s unemployment rate, to an average of 9.2 per cent next year from 11.6 per cent currently. That, in turn, should support consumer spending.
It figures the province’s economy will pick up to 1.8 per cent next year and 2.1 per cent in 2014 – hardly a blistering pace, but a big improvement compared with the past few years.