Impact Regina March 2017
Executive Summary
Impact Regina
Despite weak resource prices, the Regina economy continues to grow with employment, housing starts, building permits, and population all posting increases: •
Total employment in the Greater Regina Area was up 1.1% or 1,450 positions in January to February 2017 over the same period in 2016.
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Year-to-date employment in February 2017 was up over the same period in 2016 in agriculture (100), utilities (100), manufacturing (800), wholesale and retail trade (300), transportation and warehousing (800), professional, scientific and technical services (1,300), education services (600), healthcare (2,200), accommodation and food services (600), and public administration (1,100).
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Year-to-date employment in February 2017 was down in resource extraction (-700), finance, insurance, real estate and leasing (-1,500), business, building and other support services (-2,200), information, culture and recreation (-700), and other services (-1,000).
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Construction employment remains suppressed but the slide shows signs of slowing. Year-to-date construction employment is down by only 150 positions year to date over 2016.
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The average year-to-date unemployment rate remains low at 5.5%, up from 4.6% in February 2016. The increase in the rate was driven primarily by the addition of 1,500 persons (year-to-date) to the ranks of the unemployed. While worrisome, the increase in the number of unemployed is beginning to show signs of slowing.
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Total housing starts are up by 56 units or 98.2%, rising from 57 units in January 2016 to 113 units in January 2017. Increases were widespread across singles, semi-detached, row, and apartment units.
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2017 year to date building permits are up 28.6% over January 2016. While residential and government/institutional permits were down by 5.8% and 72.4%, respectively, these drops were more than offset by increases in industrial (917.6%) and commercial (132.8%) permits.
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Interest rates are not expected to increase through much of 2017 with continued low inflation.
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2016 population was up 2.6% over 2015 to 247,224 on the strength of international and intraprovincial migration. This can be expected to continue through 2017 with continued employment growth spurring further in-migration.
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The Conference Board of Canada forecasts Regina’s economy to post a 1.8 per cent real GDP gain in 2017, following 1.3 percent growth in 2016.
Economic Indicators March 2017 Month to Month
Employment Unemployment Rate (%)
Consumer Price Index (2002=100) Housing Starts Total (Units) Building Permits Total ($000s)
Gross Domestic Product (2007 $M)
Feb 2016
Feb 2017
136,700
139,600
2,900
4.9
5.4
0.5
Jan 2015
Jan 2016
131.5
133.9
2.4
57
113
23,341
30,023
2015
2016
240,868
247,224
2016
2017f
14,169
14,426
% Chg
Chg
% Chg
Feb 2016
Feb 2017
2.1%
137,700
139,150
1450
1.1%
10.2%
4.6
5.5
0.9
19.8%
Jan 2015
Jan 2016
1.8%
131.5
133.9
2.4
1.8%
56
98.2%
57
113
56
98.2%
6,682
28.6%
23,341
30,023
6,682
28.6%
6,356
2.6%
Negative Trend Positive Trend 257
1.8%
No Significant Change
Sources: Statistics Canada Cansim 2820128, 0270034, 326-0020, 0260003, 0510056, and Conference Board of Canada Metropolitan Outlook Autumn 2016. Note: All data presented above is raw/not seasonally adjusted.
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Impact Regina
Population (persons) July 1
Chg
Year to Date
2016 in Review Executive Summary
Impact Regina
The Regina economy showed a mixed bag of results in 2016. While many results were positive, activity contracted or slowed in a number areas, notably construction: •
The latest census population counts show that Greater Regina Area (GRA) 2016 population was up 11.8% over 2011.
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Employment growth was positive in 2016 at 1.1% or 1,500 jobs and easily outstripped earlier Conference Board of Canada forecasts.
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Employment growth was strong in 2016 in wholesale and retail trade, professional, scientific and technical services, and healthcare but softer in resource extraction, finance, insurance, real estate and leasing, information, culture and recreation, and accommodation and food services.
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Employment dropped in 2016 in agriculture, utilities, construction, manufacturing, transportation and warehousing, business, building and other support services, education services, other services, and public administration.
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The unemployment rate remains low at 5.3% but the number of unemployed continued to grow.
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Building permits were down from 2015 as the stadium work wound down but housing starts were almost equal to 2015 levels
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The outlook for 2017 is for continued positive real Gross Domestic Product (GDP) growth and at a slightly more robust pace than in 2016.
Indicator
2016
2017
Chg
137,783
139,300
1,517
1.1%
6,258
7,733
1,475
23.6%
4.3
5.3
0.9
21.5%
Participation Rate (%)
72.7
73.0
0.3
0.4%
Employment Rate (%)
69.6
69.2
-0.4
-0.6%
795,446
689,388
-106,058
-13.3
Employment Unemployment Unemployment Rate (%)
Building Permits Total ($000s) Housing Starts Total (Units) Gross Domestic Product (2007 $M) Indicator Population (persons)
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%Chg
1,597
1,563
-34
-2.1%
14,169
14,426
257
1.8%
2011
2016
Chg
%Chg
211,519
236,481
24,962
11.8%
Analysis Population and Demographics The latest census population counts show that Greater Regina Area (GRA) 2016 population was up 11.8% over 2011. With the release of 2016 census data, 2012 to 2015 population data for GRA is under revision. As such, a 2015 to 2016 comparison is unavailable. Labour Market Key among the labour market indicators in the modest increase in the total number of people employed in the GRA. Total employment increased by 1,517 persons or 1.1% between 2015 and 2016. Within the strategic sectors in the GRA (resource extraction, metal fabrication, machinery manufacturing, finance and insurance, agri-business, and tourism) employment growth was largely positive. 2016 employment was up over 2015 in resource extraction (400), wholesale and retail trade (2,700), finance, insurance, real estate and leasing (100), professional, scientific and technical services (1,200), healthcare (3,100), information, culture and recreation (700), and accommodation and food services (200). While construction is primarily a supporting sector, employment in this industry remains suppressed with the wind up of several large industrial and commercial projects, notably the stadium. However, the slide shows signs of slowing. 2016 construction employment is down only 750 positions over 2015. 2016 employment was also down in agriculture (-200), utilities (-300), manufacturing (-600), transportation and warehousing (-2,000), business, building and other support services (-900), education services (-800), other services (-400), and public administration (-900). 2015 to 2016 Employment by Industry Change (Jobs) 4,000 3,000 2,000 1,000 0 -1,000 -2,000 -3,000
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Impact Regina
5,000
The 2016 unemployment rate remains low at 5.3%, up from 4.3% in 2015. Driving the increase was the addition of almost 1,500 persons to the ranks of the unemployed. This occurred during a period of positive job growth and suggests that there remains a lack of opportunities elsewhere, notably Alberta, to spur outmigration of the unemployed. The increase in the number of unemployed and working was responsible for the modest increase in the participation rate. The participation rate is the number of employed and unemployed divided by the population aged 15 years and over. During the same period, the employment rate (ratio of employment to total population) declined slightly as employment growth did not keep pace with population growth. Construction Construction in 2016 shows a variety of results. While construction employment dropped with a weakening of industrial and commercial activity, residential and government/institutional permits and starts drew almost level or exceeded 2015 levels of activity.
A city building permit is needed to construct, demolish, build an addition or renovate a building. The city issues the permit and reviews plans to ensure they comply with all current building codes, bylaws and other applicable regulations. In 2016, residential building permits were issued to create homes for 1,790 Regina families, an increase of 415 homes over 2015. In dollar terms, 2016 residential building permits (a leading indicator of housing starts) were up 22.3% over 2015 suggesting a resurgence in residential activity in early 2017. In addition, institutional and government permits (largely new school builds) were up 45.6% over 2015. However, a drop in industrial (-71.7%) and commercial (-52.5%) permits, as stadium work winds up, pushed total year to date permits down by 13.3%. Annual Total Starts - Regina CMA - Units 3500 3000 2500 2000 1500 1000 500 0
1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016
Impact Regina
Total housing starts in 2016, at 1,563 units, were down only slightly from 2015, -2.1% or 34 units. While total housing starts showed signs of matching 2015 levels in the first ten months of the year, starts dropped 109 units or 52.7% in November 2016 over November 2015, the second slowest November since 2004. The increase in starts during December (133% or 88 units) was not large enough to offset the November decline and negated the possibility if drawing even with 2015 starts. Furthermore, 2016 starts suffered in comparison to 2015 because 2015 starts included the Capital Point condominium project, with 144 apartment/condo units.
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Outlook for 2017 According to the Conference Board of Canada’s Autumn 2016 Metropolitan Outlook, the Regina economy will grow in real terms by 1.8% in 2017. Employment will be virtually flat with growth of 0.1%. However, the unemployment rate will moderate and drop to 5.1%. Despite a forecasted 2% increase in population, the Conference Board forecasts total housing starts to drop to 1,232 units. Overall, according to the Conference Board, GRA will see subdued growth across most sectors. Definitions Employment: Employed persons are those who, during the reference week, did any work for pay or profit, or had a job and were absent from work. Unemployment: Unemployed persons are those who, during reference week, were available for work and were either on temporary layoff, had looked for work in the past four weeks or had a job to start within the next four weeks. Labour Force: Civilian non-institutional population 15 years of age and over who, during the survey reference week, were employed or unemployed. Unemployment Rate: Number of unemployed persons expressed as a percentage of the labour force. The unemployment rate for a particular group (for example, by age, sex, marital status etc.) is the number of unemployed in that group expressed as a percentage of the labour force for that group. Participation Rate: Total labour force expressed as a percentage of the population aged 15 years and over. The participation rate for a particular group (for example, women aged 25 years and over) is the labour force in that group expressed as a percentage of the population for that group.
Seasonal Adjustment: Fluctuations in economic time series are caused by seasonal, cyclical and irregular movements. A seasonally adjusted series is one from which seasonal movements have been eliminated. Seasonal movements are defined as those which are caused by regular annual events such as climate, holidays, vacation periods and cycles related to crops, production and retail sales associated with Christmas. While seasonal adjusted data allow month to month comparisons, it should be noted that these figures do not represent the actual number of individuals employed or unemployed. The more valid comparison is using the year-over-year change, comparing the raw data against the same month in a prior year. Source: Statistics Canada, Guide to the Labour Force Survey. Catalogue no. 71-543-G
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Impact Regina
Employment Rate (employment/population ratio): Number of employed persons expressed as a percentage of the population 15 years of age and over. The employment rate for a particular group (for example by age, sex, marital status, province, etc.) is the number employed in that group expressed as a percentage of the population for that group.
About EDR Economic Development Regina Inc. (EDR) is the economic development agency for the Greater Regina Area (GRA). EDR is a not-for-profit economic development corporation, governed by a volunteer board of directors. EDR provides leadership to the community to support industry growth and diversification through retention and expansion of existing business and encouraging investment, development of industry and tourism. In collaboration with key stakeholders, we work to identify, develop and promote opportunities that advance economic prosperity and ensure the GRA offers a vibrant and diversified economy for investors, is a positive destination experience for visitors and offers a high quality of life for residents. www.economicdevelopmentregina.com
About Praxis Consulting Praxis Consulting is Saskatchewan’s largest locally-based management consulting firm. Praxis works collaboratively with clients in the facilitation of growth and excellence, leveraging an unmatched wealth of experience across multiple sectors. Praxis strives to: •
Inform clients with market research and economic impact studies, providing relevant insights into various sectors and communities.
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Strategize, developing custom solutions tailored to clients’ most unique and complex needs.
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Execute strategic plans, portfolios and projects by facilitating internal project management, change management and communication capacity.
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