Construction projects continue to offset manufacturing weaknesses
in New Brunswick, says RBC Economics
TORONTO, June 22, 2006 — Despite a softening
global demand for paper and wood products, New Brunswick's
economy is expected to grow by 2.7 per cent this year, according
to the latest provincial economic outlook released today by
RBC Financial Group.
"While manufacturing shipments were healthy overall
in 2005, the province faced some challenges as significant
weaknesses in its paper and wood products industry emerged
over the past year," said Craig Wright, vice-president
and chief economist, RBC. "Next to Ontario and Quebec,
New Brunswick is the third most dependent province on manufacturing,
making up 15 per cent of its economy."
Non-residential construction projects, such as the $1.4-billion
Point Lepreau nuclear plant and the $750-million Canaport
LNG project, continue to provide economic relief, as growth
in this sector has averaged about 10 per cent over the past
five years. As a result of the steady growth in construction,
New Brunswick has experienced strong employment growth and
a rebound in weekly earnings.
The report notes that while the construction boom will continue
through 2006, large-scale projects will begin to wind down
and the province could see more workers migrate west in search
of work in the Alberta oil sands. The pace of migration from
New Brunswick to Alberta has doubled in 2005 over 2004.
While regional differences exist across the country, Canada
is well positioned to absorb global economic shocks as a result
of geographically diversified investments, a strong consumer
sector and sound fiscal policy. Newfoundland and Labrador
will be the provincial growth leader this year with activity
in the oil and nickel sectors driving growth. After Newfoundland
and Labrador, the strongest economies will be west of the
Manitoba-Ontario border for 2006.
The RBC Economics Provincial Outlook assesses the
provinces according to economic growth, employment growth,
unemployment rates, personal income growth, retail sales,
housing starts and the Consumer Price Index.
According to the report (available online as of 8 a.m. E.D.T.,
at www.rbc.com/economics/market/pdf/provfcst.pdf),
provincial forecast details are as follows:
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For more information contact:
Craig Wright, RBC Financial Group Economics,
(416) 974-7457
Derek Holt, RBC Financial Group Economics,
(416) 974-6192
Kathy Bevan, RBC Financial Group Media Relations,
(416) 974-8810
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