What has been driving the significant regional population shifts within Canada? One obvious answer can be found in Gross Domestic Product (GDP) figures per capita for each province. (GDP “per capita” means output divided by population.) The special feature that is separating the provinces most clearly at this time is resource riches.

Some caveats are in order. GDP per capita is not a direct measure of the wealth of each individual in a region. Never mind the fact that some people simply earn more or have more assets, there are other key factors that come into play. The most important of these is trade between provinces and across international borders. Net exports (i.e., exports minus imports) contribute significantly to GDP, but this is not money that is going directly to individuals in the region.

Nevertheless, there is some fascinating information to be gleaned from the regional figures on GDP per capita in Canada. According to this measure, Alberta is by far the greatest wealth generator in the country at this time. Alberta’s GDP per capita, at $74, 825 in 2007, was 30.5% higher than second-place Newfoundland and Labrador ($57,348) and 45.8% higher than third-place Saskatchewan ($51,327).

Alberta, Newfoundland and Saskatchewan were the only three provinces with GDP per capita above the national average ($46,441) last year. Alberta’s placing at the top of the charts is not surprising. However, the fact that Newfoundland and Saskatchewan are doing so well is a bit of a shock. It all comes down to natural resources.

Alberta accounts for almost two-thirds of crude oil production in Canada. That leaves about one-third to be accounted for, which is made up of Saskatchewan at 17% and Newfoundland at 14%. Newfoundland has three offshore oil fields with a fourth in the planning stage. The international price of oil keeps hitting new record highs.

Furthermore, both Saskatchewan and Newfoundland are strong in other resource areas as well. Saskatchewan is big in agriculture and in potash and uranium. Newfoundland has iron ore and copper/nickel mining in Labrador.

Perhaps the most telling statistics for the three leading provinces have to do with the growth in GDP per capita over an extended time period. Versus ten years ago, Newfoundland’s GDP per capita has tripled; Alberta’s has doubled; and Saskatchewan’s has risen by 80%. No other provinces have been in the same ball park and the Canada-wide increase was 57%.

Moving on to other regional comparisons, Alberta’s GDP per capital now stands 64.6% higher than fourth-place Ontario ($45,457), 72.3% higher than fifth-place British Columbia ($43,425) and 82.8% higher than sixth-place Manitoba ($40,943).

Then we come to Québec and the other Atlantic provinces. Alberta’s GDP per capita is almost double (93.3% above) Québec’s level ($38,718) and is more than double the levels in each of the Maritime provinces – Nova Scotia ($35,643); New Brunswick ($35,224); and Prince Edward Island ($32,735). 

Given that Alberta’s GDP per capita is so outsized, it also follows that its share of national GDP is well above what its population alone would otherwise account for. Alberta’s share of national GDP is about four percentage points higher than its share of national population (14.5% and 10.5% respectively).

A couple of years ago, jobs in the Alberta Tar Sands were attracting workers from Saskatchewan and Newfoundland in droves. Now those workers are finding opportunities at home. Both provinces are recording net interprovincial gains in population for the first time in many years.

The latest wave of migrant workers to Alberta has come from Québec and Ontario. The GDP per capita figures go a long way towards explainng why.

Alex Carrick

Find Canadian construction-related economic articles in Canadian Construction Market News and in the Economic Outlook section of Daily Commercial News.

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