April 30, 2018
SASKATOON, SASKATCHEWAN – Today, the Saskatoon Regional Economic Development Authority (SREDA) released its Q1-2018 Economic Dashboard for the Saskatoon Region. For Q1-2018, SREDA rates the status of the local economy with a B- grade, maintaining the Q4-2017 rating.
“2018 has started well with economic indicators pointing to stability and some growth momentum in the local economy. Many forecasts continue to expect 2.0%+ growth for Saskatchewan, and the first quarter economic performance definitely supports this positive outlook. At the same time, business and consumer confidence in the local economy seems to be increasing, which bodes well for steady growth in many sectors. As always, there is some uncertainty in the longer term rate of growth, but the local economy seems to be shifting from a state of cautiously optimistic to steadily growing. The Saskatoon I know will find ways to capitalize on this new momentum,” said Alex Fallon, President and CEO of SREDA.
Seven reasons why the Saskatoon Region economy remains at a B- grade:
- GDP growth: The labor market began the year on a soft note, which is not unusual. The Saskatoon Region lost 300 jobs (-0.2%) in Q1-2018 following a similar decline in Q4-2017. Despite the decline, the unemployment rate fell 0.8 percentage points to 6.9% in Q1-2018, reflecting a decline in number of people seeking jobs. With steady GDP growth, the labour market should begin to pick up again.
- Growing population: The number of intercity and international migrants remains high. At 2.8%, the Saskatoon Region was the fastest growing metropolitan area in Canada in 2017. The Region’s population grew an estimated 0.5% in Q1-2018, well above the provincial average (0.1%).
- Slower construction: The number of new residential construction continues to lag as high inventory and unsold units dampen builder confidence. As of Q1-2018, construction has begun on 212 single-detached and multi-unit homes, almost one-third lower than same period last year.
- A buyers’ market: Existing home sales were down 10.0%, putting further pressure on prices (down 2.4% to $335,653) in favour of buyers. Demand for new homes will continue to be impacted by tighter mortgage rules and higher interest rates.
- Moderate building intentions: Compared to Q1-2017, building permits in Saskatoon rose 3.7% to $145.6 million, signaling potential rebound in construction activity later this year. The increase reflects a 41.9% jump in non-residential permits, offset by 21.5% drop in residential permits.
- #Saskatooning: Skyxe continues to see busy passenger traffic. In Q1-2018, passenger traffic grew 2.8% to 390.049, buoyed in part by interest generated by tourism.
- Business confidence: Q1-2018 saw 311 new business start-ups, a 17.5% drop from the same period last year.
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