We keep hearing that the Saskatoon economy is more diversified now than ever, but amidst headlines attributing a dependence on the resource sector to lack of economic growth, many are asking the question: How diverse is the Saskatoon economy really?
The number of job vacancies haven’t changed much in Saskatchewan over the past few years. But what has changed since 2015 is the difference between the Saskatchewan and Canadian vacancy rates.
Saskatoon employment growth revs up in July. The local economy added 1,400 jobs in July, tallying up to 5,500 new hires since the beginning of the year. This was among the strongest performances across the CMAs. Compared to July last year, the number of persons employed in the metropolitan area was up 2.8%.
The first half results paints a mixed picture of an economy in which commercial and industrial construction intentions are gradually improving while residential construction is declining due to oversupply, stricter mortgage rules and rising interest rates. Since construction accounts for about 11% of the Region’s GDP, it will be interest to watch whether the sectors outlook improves in the next quarter.
Manufacturing shipments rose 5.5% to a historic $1.6 billion in May, following a 6.5% increase the prior month. Compared to same period last year, shipments from Saskatchewan factory floors were up 22.9%, the highest year-over-year gain among the provinces.
Construction permits pick up in April. The total value of building permits issued by Saskatoon and surrounding municipalities increased 12.8% m/m to $93.1 million in April. following a 43.3% increase the prior month.
Employment inches to a record high. The local economy created additional 500 jobs in May, tallying up to 2,900 new hires since the beginning of the year. Employment has never been so high (173,000) in metropolitan area. Compared to May last year, the number of persons employed in the CMA was up 2.1%.
SREDA’s Q2 Consensus Forecast Survey show economists have slightly trimmed their 2018 outlook for the Saskatchewan economy. Real GDP growth is now forecast to come in at 2.0%, 0.1 percentage point slower than projected in December, pushing it down to fifth position on the provincial growth leader-board. The economy is expected to expand at a slightly moderate pace (+1.9%) in 2019, tied with BC and Ontario for second place on the leader-board.
The duration of unemployment is a typical lagging indicator, which tends to peak after a recession has occurred. As the economy continues to build on last year’s gains, with several indicators supporting a consensus forecast of 2.1% in 2018, we should expect to see the duration of unemployment come down.
Employment rebounds after three months of declines. The local economy added 1,100 jobs in February, the largest monthly gains since October 2015. Compared to February 2017, employment was up 0.5%, closer to where it stood four months ago.
After two successive rate hikes last year, we are starting to wonder if increasing borrowing cost is already putting pressure on Sask. households. The 2017 data shows many are avoiding outright bankruptcy by choosing to restructure their debts, which isn’t the cheapest alternative either.
Restaurant patrons tend to be price-sensitive. The expansion of PST to restaurant meals in April 2017 immediately led to higher menu cost and reduced appetite for restaurant meals. Saskatchewan was the lone province with lower food service sales in 2017. Nationally, receipts from food service and drinking places were up 5.3% in 2017.
The January data paints a picture of falling rents in YXE, as landlords continue to offer discounts and rental incentives in response to historically high vacancy rate (9.4%). With ongoing improvement in economic conditions in the Region and strong population growth, we can expect to see stronger rental demand and gradual withdrawal of rental incentives.
One of the best leading indicators available to economists is building permits issued by municipalities. At the time that Calgary, Edmonton and Regina continue to see declines in permits, Saskatoon has made a strong comeback, signaling a potential rebound in construction activity six to 12 months ahead. This bodes well for the local economy.
The labour market began the year on a soft note. The CMA lost 400 jobs in January, marketing the third consecutive monthly decline since October 2017. Compared to same period last year, employment was down 0.3%, closer to where it stood two years ago.
Construction permits in the Saskatoon CMA increased for the second consecutive month after a decline in September.
Overall, in 2017 employment in the Saskatoon CMA rose 1.1% (or +1,800 jobs), representing a modest rebound from 2016. In 2017 Saskatoon added 2,500 full-time jobs and shed 800 part-time positions.
Consumer bankruptcies in Saskatoon are coming down. On quarterly unadjusted basis, 80 consumers filed for personal bankruptcies in Q3-2017, 11.1% fewer than the same quarter last year. Over the same period, the number of consumer bankruptcy proposals fell by 8.8%. Despite the quarterly declines, consumer bankruptcies and proposals are slightly higher in the first three quarters of 2017 than a year ago.
The local economy shed 1,200 jobs in November after strong consistent gains in the last six months (+3,700). However, even with the November loss, net employment in the Region was still up 1.6% YTD, a rebound from 2016.
Saskatoon now has the lowest average monthly rent in October 2017 compared to other major Western Canadian cities.
After two consecutive months of decline, construction intentions have picked up the pace. The total value of building permits issued in the Saskatoon CMA jumped 70% from $53.2 million in July to $90.5 million in August.
Saskatoon’s labour market appears to be on the mend with the most recent Statistics Canada data showing five conservative months of job gains. The local economy added 900 new positions in September, tallying up to a net of 2,378 jobs since the beginning of the year. Despite a sturdy increase in the number of people joining the labour force, last month’s job gain was strong enough to nudge the CMA’s unemployment rate down to 7.9%. Compared to a year ago, employment in the region was up 1.7% in September.
One predictable outcome from the recent economic downturn is falling price of rental accommodations, a benefit to new tenants and cost to landlords. The latest data from the Consumer Price Index show rents in Saskatoon continue to decline after ramping up over the past decade.
With Brad Wall’s tenure as Premier of Saskatchewan coming to a close, here’s a summary of provincial economic metrics over the last decade.
With NAFTA renegotiations on the horizon, the Saskatchewan-U.S. trade balance becomes vulnerable to shifting in favour of our southern neighbours.
After two years of decline, capital investment in Saskatchewan is expected to climb higher in 2017, albeit by a moderate amount.
As an industry, wholesale trade flies under the radar, especially compared to its more popular and monitored cousin – retail trade. However, over the past ten years the industry has been an important driver for growth in the Saskatoon Region, with data showing that provincial wholesale trade volumes nearly doubled from 2006 to 2016 – the fastest growth of any province.
Back in 2007 average weekly wages in Saskatchewan were more than 5% below the national average. Fast forward to Q4 2016 and wages in Saskatchewan have increased to be above the Canadian average and third highest among all provinces.
Since reaching the low point of the current cycle in November 2015, Saskatchewan manufacturing shipments have been grinding steadily higher.
After booming along with the broader economy between 2010 and 2015, residential construction activity in the Saskatoon Region cooled off slightly in 2016.
Falling commodity prices weighed heavily on the value of Saskatchewan’s exports in late 2015 and much of 2016. However, according to data released by Statistics Canada last week, exporters in this province are on track to finish 2016 on a high note.
2016 wasn’t the easiest year economically for the prairies as prices for many commodities reached multi-year lows. However annual employment data shows that the diversity and resilience of the Saskatoon Region economy allowed it to handle the commodity storm relatively well.
Demographics can have an important impact on economic growth. Fortunately for the City of Bridges, data compiled by Statistics Canada indicates Saskatoon has the youngest population in Canada – and by a fairly wide margin.
Population data released by Statistics Canada shows that Saskatchewan’s population grew at a rate of 0.41% during Q3 – in line with the Canadian average of 0.43%.
Interest rates in Canada and the U.S. have been really low ever since the Global Financial Crisis in 2008. Yesterday the U.S. Central Bank (the Federal Reserve) raised rates slightly, and while this doesn’t directly impact borrowers in Canada, it does have the potential to eventually influence rates in Canada and other financial variables such as the CAD/USD exchange rate.
Data released by Statistics Canada this week shows Saskatchewan exports perked up in October, surging to their highest level of the year.
Data released by Statistics Canada on Friday indicates that the Saskatoon Region economy added jobs for the fifth consecutive month in November 2016.
Through the first three quarters of 2016 Saskatchewan farm cash receipts totaled just under $10.0B ($9.998B to be exact). This amount is down slightly from the first three quarters of 2015 when provincial farm cash receipts reached a record $10.1B, but is up from $9.4B during Q1-Q3 2014.
The Canadian dollar started this year off at its lowest level against the U.S. dollar in over 10 years. Since then the loonie has risen, however by historical standards it remains low.
After experiencing some of the strongest growth in retail spending across all provinces between 2010 and 2013, Saskatchewan retail activity has cooled off in 2015 and 2016.
Saskatchewan manufacturing shipments rose 1% in September 2016 to $1.24B (seasonally adjusted), their highest monthly level since January 2015.
With the decline in oil prices over the last two years, Canadians have enjoyed lower gasoline prices at the pumps.
After experiencing a building boom from 2007 to 2014 (except for 2009), the Saskatoon residential construction market has slowed to a more sustainable pace since the start of 2015.
Construction is a key sector within the Saskatoon Region economy. Recently spending on a large number of non-residential projects has buoyed this sector.
Despite the recent economic slowdown in the provincial economy, Saskatchewan’s population has continued to climb higher. But what’s actually been driving that population growth may come as a surprise to some.
Data released yesterday by Statistics Canada shows that Canadian Gross Domestic Product (GDP) contracted by an annualized 1.6% in Q2 2016. This is the largest contraction since Q2 2009, when the world was mired in the global financial crisis.
Back during the boom, wage growth in Saskatchewan was among the strongest in the country. Recently, growth in earnings has cooled down, but as data released yesterday points out, wages in Saskatchewan remain among the highest in the country.
Back in February, SREDA released its Saskatoon Region Economic Diversity Report. This report highlighted the Region’s diversified economy, outlining the range of industries supporting the population. The backbone of this diverse economy is an army of small businesses.
Maybe it was the weather or maybe it was pent up demand. Whatever the reason, Saskatchewanians didn’t hold back on their shopping needs (or wants) in June.
Given some of the less than stellar news stories emanating from the Saskatchewan manufacturing sector recently (including job losses), yesterday’s manufacturing shipment survey from Statistics Canada provides a welcome dose of positive news.
The slowdown in the Western Canadian economy has been well broadcast and according to a recent survey done as part of the SREDA NewsFlash, that melancholy sentiment is echoed by the local community.
While residential construction activity remains slow compared to recent years, the number of new homes being started in the Saskatoon Region moved higher for the second consecutive month in July.
After a tough stretch in which the Saskatoon Region economy saw job losses in six of the last seven months, employers changed their tune and recorded a solid gain to payrolls in July.
While the slowdown in new housing construction (i.e. housing starts) in Saskatchewan has been well broadcast, what has been less publicized is the strong level of renovation activity that has continued unabated.
Despite the slowing economy, Saskatchewanians have continued to enjoy a meal out of the house thus far into 2016.
When consumers feel optimistic about things such as their job prospects and finances, they often show it by hitting the streets and dropping their hard earned cash at stores.
When the private sector economy slows down, one of the best things governments can do to counteract this is to simply build stuff . And that appears to be exactly what’s happened in Saskatoon in 2016.
In contrast to skyrocketing home prices in Toronto and Vancouver that have vexed regulators concerned about affordability, housing prices in Saskatoon have remained fairly stable.
Despite some wet-soggy weather during the month, builders in Saskatoon started construction on a higher number of residential dwellings in June 2016.
Employment has dropped slightly in June 2016. SREDA Insights provides a quick summary of the reasons why and if we should be concerned.
We know Saskatchewan’s minimum wage is increasing, but how does Saskatchewan compare to other provinces? How is the minimum wage calculated? What’s the impact on Saskatoon businesses? Will it increase again? SREDA Insights provides a quick summary of this issue.