After experiencing a modest increase in the second half of 2018, employment in the Edmonton census metropolitan area (CMA) eased in the first three quarters of 2019. Real gross domestic product (GDP) growth for 2019 is estimated to be in the range of 0.5 per cent for the city of Edmonton. This will increase to the range of 1.4 per cent in 2020.
In spite of weak employment numbers, average weekly wages in the Edmonton CMA increased in Q3 2019 on a year-over-year basis as the number of hours worked rose and employment in some high-paying sectors, such as manufacturing, continued to recover some of the losses observed between 2015 and 2017.
With very low inflation, as measured by the Consumer Price Index (CPI), the rise in average weekly wages meant that the average employed person saw real gains in their income. These gains will help to sustain the consumer side of Edmonton’s economy over the remainder of 2019.
In 2019 and 2020, growth will persist as the economies of the province and the city continue to recover; this is assuming West Texas Intermediate (WTI, the North American benchmark oil price) holds within the $US 50 – $US 60 range. Growth rates, however, will be very modest when compared to those experienced between 2010 and 2014.
Lower growth prospects for the global economy and continuing uncertainty as to the expansion of energy export infrastructure will mean that Canadian energy prices are likely to be volatile for the remainder of 2019 and into 2020. While prices held steady in the second quarter of 2019, there is considerable downside risk with respect to the energy prices that Alberta producers receive. This could have negative implications on the economic outlook for the city of Edmonton, Edmonton CMA and Alberta.