Alberta’s economy is expected to regain its footing in 2020 after a period of weakness in 2019. Real gross domestic product (GDP), a common measure of economic activity, is forecast to grow by 2.5% and surpass pre‑recession levels.
Download: Complete Economic Outlook Chapter 2020-23 Fiscal Plan (PDF, 6.7 MB)
Economic outlook 2020-23
Several aspects of the economy are expected to contribute to the turnaround in 2020:
- an increase in exports, led by a rebound in oil production
- continued growth in investment outside oil and gas extraction
- a rebound in oil and gas investment
- a rise in consumer spending, supported by employment gains and a growing population
The Job Creation Tax Cut, which reduces Alberta’s corporate income tax rate to 8% by 2022, will make Alberta one of the most attractive investment destinations in North America.
A more competitive tax regime, along with additional pipeline access, will help drive business investment and employment gains. This is expected to attract more people to the province, boosting consumer spending and housing activity.
Real GDP growth is forecast to accelerate to an average of 2.8% per year from 2021 to 2023.
The road to recovery has been fraught with challenges for the province over the past few years, stemming from a lack of market access and investment in the energy sector.
The result has been the longest recovery from a downturn on record in Alberta.
Key energy price and economic assumptions
Table 1: Energy price assumptions
|Fiscal year||2019-20 Estimate||2020-21 Forecast||2021-22 Forecast||2022-23 Forecast|
|WTI Oil Price (US$/Barrel)||58.00||58.00||62.00||63.00|
|Light Heavy Differential (US$/Barrel)||14.70||19.10||20.60||16.40|
|Natural Gas (Alberta Reference Price Cdn$/GJ)||1.40||1.70||1.80||2.10|
|Exchange Rate (US cents/Cdn$)||75.5||76.5||77.0||77.5|
Table 2: Economic assumptions
|Calendar Year||2019 Estimate||2020 Forecast||2021 Forecast||2022 Forecast||2023 Forecast|
|Economic Growth (% change in Real GDP)||0.3||2.5||2.8||2.9||2.8|
|Employment (% change)||0.5a||1.4||2.1||2.1||2.1|
|Unemployment Rate (%)||6.9a||6.7||6.0||5.5||5.1|
More budget information
A plan to get Albertans back to work, make life better and stand up for Alberta.
Revenue projections from taxes, transfers, investment income and resources.
Budget 2020 invests in the infrastructure families and communities need.
Budget 2020 continues to optimize Alberta’s tax system.