Ottawa, June 13, 2016 – After subdued growth in the last few years, Quebec’s real GDP is expected to improve to 1.8 per cent this year and another 2 per cent in 2017, according to The Conference Board of Canada’s Provincial Outlook: Spring 2016.
Ottawa, June 13, 2016—After subdued growth in the last few years, Quebec’s real GDP is expected to improve to 1.8 per cent this year and another 2 per cent in 2017, according to The Conference Board of Canada’s Provincial Outlook: Spring 2016.
“Quebec’s economy seems to be slowly gaining momentum,” said Marie-Christine Bernard, Associate Director, Provincial Forecast. “The improvement in real GDP growth will rest on Quebec consumers’ shoulders, as household consumption is projected to benefit from sound job creation, stronger wage increases, and federal fiscal stimulus.”
- Quebec’s real GDP is forecast to grow by 1.8 per cent in 2016 thanks to sound job creation, stronger wage increases, and federal fiscal stimulus.
- The services industries are particularly well positioned and will grow by 2.1 per cent this year.
- Only four provinces are expected to see real GDP growth above 2 per cent this year: British Columbia, Ontario, Manitoba, and Prince Edward Island.
- The commodity price slump will continue to hurt the economies of Newfoundland and Labrador, Saskatchewan, and Alberta. The wildfires in northern Alberta will have a short-term economic impact but rebuilding efforts will lift real GDP in 2017.
While exports and investments are still struggling to see stronger growth, both are expected to pick up in speed over the next two years.
Exports are forecast to improve going forward in conjunction with U.S. demand. This bodes well for the manufacturers who, after shedding jobs for three years in a row, will be hiring once again this year. Investment in both non-residential construction and machinery and equipment should follow suit as businesses will face capacity constraints when they increase activity to meet foreign demand. Both of these investment segments are projected to rebound strongly in 2017.
Despite declining housing starts, the construction industry will see growth this year as major infrastructure projects, such as the new Champlain Bridge and the Turcot Interchange, will fuel growth in the Montreal region.
The services industries are particularly well positioned and will grow by 2.1 per cent this year. Consumers are still benefiting from low gasoline prices and rock-bottom interest rates, which will help wholesalers and retailers. After two years of belt tightening in the public sector and a balanced budget in hand, civil servants will also have more room to breathe in 2016.
Employment gains will be slower this year compared to 2015, but are expected to accelerate steadily in 2017 and 2018. Meanwhile, the unemployment rate will remain stable at 7.6 per cent over the next two years.
The Provincial Outlook: Spring 2016 is available via the Conference Board’s e-Library.