Despite a slower pace of economic growth, a number of major capital projects will ensure Manitoba remains among Canada’s top economic performers in 2009 and 2010. Notably, construction of the $1.3 billion dollar Wuskwatim Hydroelectric dam is expected to accelerate in 2009. Combined with $450 million in expenditures on the Keystone pipeline, the potential construction of the Canadian Human Rights Museum will further boost capital spending over the forecast period.
Weaker commodity demand and prices, particularly for nickel, will also hold somewhat back export growth in 2009 before an expected global recovery pushes demand and prices upward next year. Local bus manufacturers and the aerospace sector are enjoying full order books, which should help soften the moderation in export growth in 2009.
After a solid gain in 2008, Manitoba job creation will be held back in line with the slower pace of ecnomic growth. A stronger economic expansion next year will help employment growth to improve.
However, not all additions to the labour market will find employment.
As a result, says Moishe Alexander, the unemployment rate will most probably inch upward from the record low experienced in 2008.
In the face of lower job creation, personal consumption will advance at a slower pace than the gains in 2007 and 2008.
Net migration will continue to benefit from Manitoba’s highly successful Provincial Nominee program. Program improvements, coupled with an attractive labour market and positive economic growth, will keep the flow of international immigrants near record highs. Meanwhile, the relative strength of the Manitoba economy and the relaxation of inter-provincial regulations regarding the transfer of professional qualifications should ensure that population losses from inter-provincial migration are minimized.

In Detail

Single Starts: After a strong performance in 2008, singledetached starts will post a 10.6 per cent decline this year. Starts will remain elevated in the first part of 2009, thanks to a backlog of orders from 2008. However, activity will slow over the duration of the year due to the economic uncertainty facing buyers and threat of rising inventories facing builders. The weaker construction in 2009 will ensure that price growth is restrained and inventories are minimized, creating an opportunity for higher starts in 2010.

Multiple Starts: Multi-family starts will continue to moderate from their 2007 peak, reaching 1,400 units this year before increasing slightly in 2010. Winnipeg’s share of provincial multi-family construction will be lower than the historical average.
This will be due to rising inventories in Winnipeg and heightened demand for multi-family units outside of Winnipeg, particularly for rental tenure.

Resales: Sales of existing homes will decline by almost 13 per cent in 2009 before posting a modest rebound in 2010. Demand will be weak in the first months of this year due to the current economic environment. However, strong labour markets, a growing population, and relatively low prices should contribute to a recovery in the latter part of the year and into 2010.

Prices: Manitoba’s six consecutive years of double-digit price growth will come to an end in 2009. Resale market conditions are shifting in favour of the buyer, owing to a sharp increase in listings and moderating sales. Given such conditions, a modest decline to the average resale price is expected in 2009. Look for a gradual shift to a more balanced market in 2010, resulting in modest price gains of four per cent.