Economic Review and Indicators

Economic analysis and key indicators related to Alberta’s economy, labour market and various sectors within the province.

Latest Economic Review

Download: complete Weekly Economic Review (September 14, 2018) (PDF, 334 KB)

See below for highlights from the publication.

Housing starts spike

Housing starts: multi-unit starts surge in Edmonton

  • Housing starts surged in August as a significant number of multi-unit buildings were started in Edmonton.
  • Housing starts jumped 11.0% month-over-month (m/m) to seasonally adjusted annual rate (SAAR) of 33,270 units.
  • The monthly gain was based solely on volatile apartment starts (+42.6% m/m), while the pace of construction of single, semi-detached, and row units slowed.
  • Regionally, the gain was concentrated in Edmonton (+36.0% m/m), where multi-units starts surged to the highest level since November 2015.
  • Housing starts also improved in Calgary (+7.8% m/m) while they declined in the rest of the province.
  • Year-to-date (YTD), province-wide housing starts are down slightly (-2.0%) as gains in apartment starts have been offset by fewer single, semi-detached and row units (Chart 1).

Chart 1: Apartments a source of strength in 2018
Housing starts by type

Chart 1: Apartments a source of strength in 2018 - Housing starts by type
Source: Canadian Mortgage and Housing Corporation

Residential construction investment: seasonal increase in investment

  • Residential investment ticked up in the second quarter reflecting seasonal strength. It rose 5.8% quarter-over-quarter (q/q) to $3.9 billion.
  • These gains are typical for the second quarter when construction and resale activity picks up, and were partially offset by a seasonal pullback in renovation spending.
  • Despite the seasonal improvement, residential investment declined 2.4% year-over-year (y/y), as renovation spending (-7.8% y/y) was lower than a year ago (Chart 2).
  • Investment in new dwellings continued to increase (+1.5% y/y), even though rebuilding in Fort McMurray is winding down.

Chart 2: Residential investment declines with renovation spending
Contribution to year-over-year growth in residential investment

Chart 2: Residential investment declines with renovation spending - Contribution to year-over-year growth in residential investment
Source: Statistics Canada

New housing price index: new home prices tick up

  • After a pullback earlier in the year, prices of new homes in Alberta ticked up for the second month in a row.
  • The new housing price index (NHPI) edged up 0.1% m/m in July as the house-only component increased with higher material costs.
  • The increase in the house-only component was more pronounced in Calgary (+0.4% m/m), where prices have rebounded from the declines earlier in the year.
  • Despite the monthly rise, the NHPI is nearly unchanged from a year ago as slight lower house-only component prices are partly offset by an increase in land prices.

International travel: solid first half of 2018

  • Visits by international residents remained strong in the first half of 2018. The number of non-resident travellers entering Alberta rose 3.2% m/m to 92,545 in June, a 2018 high.
  • The increase was driven by a spike in overseas travellers (+16% y/y), which reached the highest level in 16 months.
  • Visits by US travellers remained solid, increasing 2.1% m/m in June, while the level held steady from a year ago (-0.6% y/y).
  • Through the first half of 2018, international visits via Alberta were up 2.2% over the same period as last year.

Industrial capacity utilization: rates at multi-year highs

  • Canadian industrial capacity utilization rate ticked higher to reach the highest rate in 11 years (Chart 3).
  • It increased 1.8 percentage points to 85.5% in the second quarter with broad-based gains, led by construction and mining and oil and gas extraction.
  • Capacity utilization in oil and gas extraction has been increasing with rising production over the last 2 years and surged 4.4 percentage points to reach an 18-year high.
  • In contrast, after reaching a 12-year high in 2017, utilization rates in petroleum and coal manufacturing pulled back in the second quarter as many refineries were under maintenance.

Chart 3: Higher utilization rates in Canada
Canadian seasonally adjusted capacity utilization rate

Chart 3: Higher utilization rates in Canada - Canadian seasonally adjusted capacity utilization rate
Source: Statistics Canada

Capital expenditures, oil and gas extraction industries: energy investment remains muted in 2018

  • Capital expenditures (CAPEX) in the Canadian oil and gas extraction industry continued to be restrained.
  • Oil and gas CAPEX totalled $9.2 billion in the second quarter of 2018, down 12.4% from the first quarter (Chart 4).
  • While the quarterly decline mostly reflects the seasonal slowdown, CAPEX was 6.2% lower than a year ago, as major oil sands projects have been completed.
  • Year-to-date, Canadian energy sector CAPEX was down 1.9%.
  • Investment has been supported by increasing conventional activity in Alberta, where the average number of rigs drilling through June was up 4.6%, compared to no gain in the rest of the country.

Chart 4: Investment in Canadian oil and gas extraction remain muted
Capital expenditures in the Canada oil and gas industry

Chart 4: Investment in Canadian oil and gas extraction remain muted - Capital expenditures in the Canada oil and gas industry
Source: Statistics Canada

Latest Economic Indicators at a Glance

The Weekly Economic Indicators at a Glance document provides a quick reference guide to the most important economic indicators. It features several charts comparing related indicators, as well as cross-provincial comparisons. On the last page, it also features a comprehensive data table of economic and demographic indicators, which is a useful reference guide when you need all the numbers quickly.

Download: Weekly Economic Indicators at a Glance (September 14, 2018) (PDF, 269 KB)

Data tables

The following file contains data in the tables and charts of the weekly economic publications, and is updated every Friday afternoon.

Download data tables: weekly economic publications (September 14, 2018) (XLSX, 70 KB)

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Archive: Weekly Economic Review

2018

Issues prior to 2018

Archive: Weekly Economic Indicators at a Glance

2018

Issues prior to 2018

Contact

Contact for the Economic Review

Robert Van Blyderveen, Economist
Alberta Treasury Board and Finance

Phone: 780-638-5628
Toll free: 310-0000 before the phone number (in Alberta)
Email: Robert.Vanblyderveen@gov.ab.ca

Contact for the Indicators at a Glance

Bijon Brown, Economist
Alberta Treasury Board and Finance

Phone: 780-643-1876
Toll free: 310-0000 before the phone number (in Alberta)
Email: Bijon.Brown@gov.ab.ca