In a report released Wednesday, the bank said June flooding in southern Alberta will contribute to a slowdown in Calgary’s GDP growth in the first half of 2013, with losses likely recouped in the second half of the year and into 2014.
The report said Calgary should be the only census metropolitan area in Canada to record economic growth of more than 4 per cent next year.
“While the June floods derailed things a bit, Calgary’s fundamentals are good,” said Ben Brunnen, a Calgary economic consultant. “Low unemployment, tight commercial vacancy rates and strong population growth will keep the economy humming into 2014.”
The city’s biggest challenges in 2014 will likely be growth-related, Brunnen said.
“Rising mortgage rates and low vacancy rates will reduce housing affordability, while strong interprovincial migration could strain our municipal infrastructure and services,” he said.
“Labour shortages in the construction trades is another area to watch, as flood rebuilding efforts and strong commercial construction activity could lead to higher costs and potentially reduce the quality of the work.”
The TD report is forecasting economic growth of 2.5 per cent for the country in 2014.
For this year, TD Economics said St. John’s will lead the country with 4.0 per cent growth followed by Calgary at 3.2 per cent. Nationwide, economic growth for 2013 is expected to be 1.8 per cent.
“Stronger energy prices and a continued steady inflow of job seekers into the province will lift construction spending and retail sales,” said Todd Hirsch, chief economist at ATB Financial. “The only danger remains the job market overheating somewhat, driving wage costs for employers higher.”
Mario Toneguzzi, Calgary Herald
Published: Thursday, September 05, 2013
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