Cautious optimism for the keystone province
As COVID-19 restrictions are loosened and the pandemic heads into the home stretch—fingers crossed—Manitoba economy’s will be at the head of the class this year.
GDP growth forecasts in the keystone province for 2022 range from a low of 3.5 per cent to a high of 4.8 per cent.
The most bullish of economic prognosticators is the Conference Board of Canada, which predicts Manitoba’s growth of 4.8 per cent will outpace the 4.4 per cent national average. Its optimism falls off for 2023, with a prediction of 1.6 per cent, matching the national performance. That kind of number won’t blow the doors off but remember, it was only two years ago that the province’s economy shrunk by nearly five per cent.
“Manitoba’s labour market has been recovering at a faster than anticipated rate. The province currently holds the lowest unemployment rate in Canada, at 5.3 per cent,” the Conference Board said.
In fact, most signs point to Manitoba’s economy being back where it was before the pandemic hit, according to the Royal Bank of Canada.
“Strong commodity prices have provided substantial support throughout the recovery, as did booming construction investment. To date, the vast majority of jobs lost during the pandemic have been recovered and employee compensation has grown at a rate above the national average,” RBC said in its latest quarterly forecast.
Further good news on the horizon is Roquette’s pea processing manufacturing plant in Portage la Prairie is set to ramp up production to full capacity this year, boosting output in the sector by 50 per cent.
TD is the second most-optimistic bank regarding Manitoba, predicting that the province’s GDP will grow by 3.8 per cent this year and 3.1 per cent in 2023.
“The manufacturing sector should get a lift from solid growth in the rest of the country and the U.S. We are also assuming a better year for the agricultural sector after a very difficult 2021. Construction output, meanwhile, should continue drawing support from government infrastructure spending,” TD said.
Manitoba’s story is similar to that of Saskatchewan and Alberta this year, where soaring commodity prices from tight canola and wheat markets helped soften the blow from lower crop yields, as exports remain well above pre-pandemic levels.
CIBC predicts Manitoba’s GDP will grow at 3.7 per cent this year—good for fourth-best in the country—and 2.6 per cent in 2023. BMO and Scotiabank are on the low end of the forecast, calling for 3.5 per cent growth this year.