Study ranks Moncton as most cost competitive

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Canada places third worldwide

The ninth Competitive Alternatives report from audit, tax and advisory firm KPMG LLP has found Moncton to be more cost competitive than 15 other cities across Canada.

Calgary ranked most expensive in the study, which examines 26 significant business cost elements, including labour, taxes, real estate, and utilities. "Larger cities are more appealing for many companies to do business, but smaller regional cities clearly offer a more cost competitive location for certain types of companies," KPMG in Canada partner Brad Watson says in a press release. "Our study found that business costs in smaller regional centres, like Moncton, are on average lower than in the largest business centres in both Canada and the U.S."

Here's a closer look at how the country's major centres fared:

• Vancouver ranks 14th. It has the highest office-leasing costs among the 16 featured Canadian cities, for both downtown and suburban office space, though it also has relatively low utility costs.
• Calgary ranks as most expensive, but it is still more cost effective than 42 international cities that were also studied. Relatively high wages, suburban office leasing costs, and electricity costs all add to its cost picture, while low natural gas costs are a plus.
• Toronto ranks 12th. Moderate industrial leasing costs, transportation costs and natural gas costs are advantages, but high labour costs are an issue.
• Montreal ranks seventh, and it has the lowest business costs among the 30 cities in both Canada and the United States with metro populations of two million or more. Low or moderate transportation costs, industrial leasing costs, and electricity costs helped its performance.

The survey also compares more than 110 cities in 14 countries. Canada placed third overall, with business costs coming in 5-per-cent lower than the United States. Britain and the Netherlands rank marginally ahead of Canada (by 0.5 and 0.3 percentage points, respectively). The favourable results are due to devaluations of the euro and the pound resulting from the European debt crisis.

"Canada continues to be a competitive place to do business," says Elio Luongo, a KPMG Canadian managing partner for tax. "Despite Canada's sluggish productivity rates, our cost position did not change from our previous study in 2010, and that tells us that through the current global economic turbulence, and despite the strong loonie, we are standing our ground."

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