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Alberta's Rural Communities Final Report Alberta’s Rural Communities Their Economic Contribution to Alberta and Canada Presented to: Alberta Agriculture and Rural Development by The Conference Board of Canada March 2012 The Economic Contribution of Alberta’s Rural Communities Prepared by: Alan Arcand and Mario Lefebvre CONTACT Mario Lefebvre The Conference Board of Canada 255 Smyth Road Ottawa, ON K1H 8M7 Tel: 514-226-1113 Fax: 613-526 4857 E-mail: [email protected] © The Conference Board of Canada, 2012. The Economic Contribution of Alberta’s Rural Communities Table of Contents EXECUTIVE SUMMARY ......................................................................................................................................... 1 Population................................................................................................................................................................... 1 Employment ............................................................................................................................................................... 1 Gross Domestic Product ............................................................................................................................................. 1 Income and Housing ................................................................................................................................................... 2 Economic Footprint .................................................................................................................................................... 3 Opportunities and Challenges..................................................................................................................................... 3 1 INTRODUCTION .............................................................................................................................................. 5 2 DATA AND METHODOLOGY ....................................................................................................................... 7 2.1 Employment by Place of Work vs. Place of Residence ................................................................................... 7 2.1 Estimating Gross Domestic Product ................................................................................................................ 8 3 RECENT TRENDS .......................................................................................................................................... 10 3.1 Employment ................................................................................................................................................... 17 3.2 Gross Domestic Product ................................................................................................................................. 26 3.3 Putting It All Together ................................................................................................................................... 34 3.4 Other Key Economic Indicators ..................................................................................................................... 34 3.4.1 Income Per Capita ................................................................................................................................ 34 3.4.2 GDP Per Capita .................................................................................................................................... 35 3.4.3 Housing Market .................................................................................................................................... 38 3.4.4 Federal and Provincial Government Revenues ..................................................................................... 39 3.5 Summary ........................................................................................................................................................ 41 4 THE ECONOMIC FOOTPRINT OF ALBERTA’S RURAL COMMUNITIES ....................................... 42 4.1 GDP Impact ................................................................................................................................................... 43 4.2 Employment Impact ....................................................................................................................................... 44 4.3 Impact on Labour Income and GST Revenues .............................................................................................. 45 4.4 Impact on Other Provinces ............................................................................................................................. 45 4.5 Economic Footprint Outside Alberta’s CMAs ............................................................................................... 46 4.6 Summary ........................................................................................................................................................ 47 5 WHAT WILL THE FUTURE HOLD FOR RURAL ALBERTA? .............................................................. 48 5.1 Alberta’s Outlook ........................................................................................................................................... 48 5.2 Rural Alberta’s Outlook ................................................................................................................................. 50 6 CONCLUSION ................................................................................................................................................. 52 APPENDIX 1: MAPS OF ALBERTA ..................................................................................................................... 54 APPENDIX 2: TABLES OF GROSS DOMESTIC PRODUCT ........................................................................... 57 GLOSSARY ............................................................................................................................................................. 155 Key Geography Terms ........................................................................................................................................... 155 © The Conference Board of Canada, 2012. The Economic Contribution of Alberta’s Rural Communities Other Terms ............................................................................................................................................................ 155 BIBLIOGRAPHY ................................................................................................................................................... 157 © The Conference Board of Canada, 2012. The Economic Contribution of Alberta’s Rural Communities EXECUTIVE SUMMARY Urbanization affects every region in the world. The share of the world’s population that lives in urban areas increased from 29.1 per cent in 1950 to 50.6 per cent in 2010. In Canada, the same share rose from 60.9 per cent in 1950 to 80.6 in 2010, while in Alberta, it rose from 48 per cent to 79 per cent. Population Rural Alberta’s population increased by an average annual rate of 0.7 per cent between 2001 and 2006. This was a stronger pace of growth than in several of Canada’s metropolitan areas. Rural population growth was strongest in rural areas within three of Alberta’s largest economic regions: Calgary, Edmonton, and Red Deer. Nevertheless, population growth was stronger in urban Alberta. As a result, Alberta’s share of provincial population fell from 22.5 per cent in 2001 to 21 per cent in 2006, The share of the population aged 60 years and older is higher in rural Alberta (16.6 per cent) than in the province’s urban areas—its census metropolitan areas (13.7 per cent) and its census agglomerations (13.2 per cent). Employment When measured using data based on the employees’ place of residence, employment in rural Alberta increased by 1.7 per cent per year between 2001 and 2006, outpacing population growth by a full percentage point per year. In other words, employment growth among rural residents increased faster than population growth. Rural employment growth was strongest in the rural areas within the economic regions of Calgary, Edmonton, and Red Deer, while it was slowest in Banff–Jasper–Rocky Mountain House and Athabasca–Grande Prairie–Peace River. When measured using data based on the employees’ place of work, employment in rural Alberta grew at a more modest 0.8 per cent pace between 2001 and 2006, implying that many people living in rural areas commute to urban areas to work. Employment growth in urban Alberta was much stronger. Employment by place of residence grew by 3.1 per cent per year on average in the province’s census metropolitan areas and by an even faster 4 per cent per year in the province’s census agglomerations. Employment by place of work grew by 2.8 per cent per year in Alberta’s census metropolitan areas and by 3.9 per cent annually in its census agglomerations. As a result, rural Alberta’s share of employment by place of work fell from 19.3 per cent in 2001 to 17.7 per cent in 2006. Gross Domestic Product Real gross domestic product in rural areas grew at a decent clip of 2.5 per cent per year between 2001 and 2006, nearly matching the national average. Rural Alberta accounted for 16.7 per cent of provincial GDP in 2006, down from 18.2 per cent in 2001. This share was slightly lower than rural © The Conference Board of Canada, 2012. 1 The Economic Contribution of Alberta’s Rural Communities Alberta’s share of employment by place of work, which was 17.7 per cent in 2006, suggesting that the
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