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While governments and the “green movement” have talked a lot about encouraging individuals to reduce their carbon footprint by using energy more wisely, the recent escalation in oil prices brought on by market forces will probably be much more effective in achieving this aim.
Despite signs of deteriorating growth in the United States, the Vancouver economy entered 2008 firing on just about all cylinders. Key to this recent economic strength is the sustained growth of commodities exports and manufactured-goods imports, all overlaid with a high level of ongoing investment related to the 2010 Olympics.
Entering 2008, the Thunder Bay economy has considerable momentum. Over the past six months, the city has been one of Canada’s six fastest-growing Census Metropolitan Areas (CMAs), according to year-over-year employment growth. Thunder Bay is currently registering a significant increase in new jobs in public administration (+40.0% year over year), health services (+29.1%) and educational services (+25.0%). This growth has been due, in part, to expansion of the Thunder Bay Regional Hospital, the development of the first university-affiliated Paleo-DNA Laboratory and the Cancer Research Institute addition at Lakehead University.
If there is one thing the world seems to have in excess supply these days, it’s grim economic news. Pick up the newspaper or turn on the radio and you will almost certainly be warned of a possible financial crisis, an imminent recession or an impending economic tsunami.
The attached table records the 10 largest construction project starts in Canada in January 2008, according to dollar volume. In the latest month, six of the projects were in Ontario, two were in Alberta and there was one each in Québec and Manitoba. Also included is the latest trend graph on starts. This looks at 12-month moving totals (based on dollars) of the two major non-residential building categories in Canada − total ICI starts and engineering work. ICI stands for industrial, commercial and institutional.
The accompanying table sets out CanaData’s latest square footage forecasts for ICI construction in Canada, by region, out to 2010. ICI stands for industrial, commercial and institutional. These are the three major non-residential building construction categories. Total ICI starts in 2007 were a little lower than had been expected due to a weak fourth quarter. 2008 forecast levels have been adjusted down as well, to take into account the spillover effects of the slowdown in the U.S. economy.
Headline inflation in the U.S. did not let up at all in January 2008. The year-over-year increase in the all-items index was 4.3%. The continuing inflation problem is encroaching on the Fed’s comfort zone with respect to lowering interest rates. In the meantime, headline (i.e., all-items) inflation in Canada has moderated slightly to stand at only 2.2% on a year-over-year basis in January 2008. The Bank of Canada has plenty of room to lower interest rates if it wants, without immediately stoking the fires of inflation.
Since job growth is a front-line indicator of economic health, it is worth looking at the latest employment numbers in the U.S. and Canada. U.S. construction jobs continue to slide (-3.6% year over year) as housing starts ended 2007 at about half of their peak level. In Canada, construction employment growth (+7.8%) is being driven by a boom in non-residential building and engineering work, while residential activity is holding its own. This story goes on to look at other sub-sector employment categories.
Canada’s merchandise trade surplus with the world in December 2007 fell to $28.2 billion (annualized), its lowest level since November 1998. Canada’s current trade surplus with the United States is a still-hefty $73.5 billion, but this is a considerable drop from the level two years ago of $128.0 billion. Canada runs a relatively stable trade deficit with the rest of the world, ranging between -$25 and -$45 billion. This story explores the reasons why the size and direction of Canada’s trade surplus is so important.
It is a well accepted fact that Canada’s productivity growth has been sub-par for some time. Having said this, a recent study by Statistics Canada (authored by John Baldwin, Mark Brown and David Rigby) provides strong evidence that productivity growth of manufacturing plants in urban areas is stronger when three key factors are present. This story goes on to examine those three factors and concludes with several recommendations for government action.
