Economic outlook

Overview

Alberta’s economy and fiscal outlook continue to face challenges from the shifting global economic landscape. With the U.S. introducing broad tariffs last year, trade uncertainty and low oil prices will be a drag on growth this year. The province’s real GDP is forecast to slow to 1.8%. A slowdown in population growth will also weigh on activity, especially consumer spending, but will help take the pressure off the labour market and reduce the competition for jobs. Inflation is forecast to remain near 2%, which will help families manage everyday costs and provide relief to household budgets.

Even with weaker oil prices, Alberta’s energy sector continues to be a source of strength, thanks to solid oil production levels and better access to global markets. The manufacturing sector is recovering after last year’s tariff-induced weakness. Business investment is expected to improve gradually over the course of the year as trade-related uncertainty fades and sentiment strengthens. Alberta’s economic fundamentals remain strong – allowing the province to focus on what matters: supporting families, protecting essential services and building stability for the future.

Resources

Budget 2026 Economic Outlook

Population growth

Following peak growth of 4.7% in the 2024 census year and a slowdown to 2.5% in 2025, population growth is forecast to slow to 1.1% in 2026, reflecting large net outflows of non-permanent residents and lower immigration targets under the 2026–2028 Federal Immigration Levels Plan. In the 2026 census year, Alberta is expected to shed 30,000 temporary residents, a sharp reversal from the net gain of 21,500 recorded in 2025.

Despite these headwinds, Alberta’s relatively strong economic fundamentals and continued affordability advantage are expected to sustain above-average interprovincial migration of 24,000, even as inflows moderate. Taken together, gains from net interprovincial migration and permanent immigration are projected to offset losses of temporary residents.