While Red Deer’s economy has been in recovery mode for the past few years, Lethbridge’s economy has expanded in the past two years, according to a new report.
Central Alberta had it rough in 2015 and 2016, and Red Deer’s economy has been recovering ever since. In 2017, Red Deer’s real GDP expanded by four per cent and 1.9 per cent in 2018.
Red Deer’s recovery is expected to continue the remainder of 2019 and 2020, with real GDP expanding by a moderate 1.7 per cent this year and two per cent in 2020, according to a select look at mid-sized Canadian cities by the Conference Board of Canada.
The findings in the report for Lethbridge show the city’s economy fired on all cylinders over the past two years, expanding by 5.8 per cent in 2017 and by 5.1 per cent in 2018. Growth will slow down to a healthy 2.6 per cent in 2019 and 2.7 per cent in 2020, according to the study.
The report states Red Deer’s labour market was disappointing last year, when employment increased by 0.2 per cent. But better days are reportedly here, with the anticipated creation of more than 1,500 jobs in 2019-20.
Lethbridge’s strong employment growth will continue with 2,700 jobs created this year and the next, following by an 1,800-job leap last year, according to the board.
Alan Arcand, the board’s associate director for the centre for municipal studies, said it’s a good news, bad news story for Red Deer.
“The economy is still growing on the positive side of the story, but if you want to look at it as glass half empty, growth is much weaker than it has been in the past,” he said, referring to the boom in the province, including Red Deer, from approximately 2004 to 2014.
Population growth has also tipped in Lethbridge’s favour, with the census released this year showing Red Deer lost its third-largest-city title to the southern centre.
If the Conference Board of Canada report is to be believed, Red Deer will not be getting its title back soon.
The report projects population growth in Red Deer to come in at 0.3 per cent in 2019 and one per cent in 2020 (102,000). It projects population growth in Lethbridge will remain at 1.9 per cent in 2019 and 2020 (close to 127,000), matching the average annual gains of the past decade.
Arcand said Lethbridge is a unique city in the province, because it’s not as much dependent on oil and gas as some other communities. It has more of a focus on the cattle industry.
“I think it’s a city that has more of a stable economy. It doesn’t suffer the lows that some other cities have – but it also doesn’t necessarily have the same number of highs, so when Red Deer and the rest of the province were going through the energy boom, you weren’t seeing much of that in Lethbridge either,” he said.
Positive news lies in Red Deer’s manufacturing sector, which has performed well over the past two years, with output expanding by 7.2 per cent in 2017 and 2.1 per cent in 2018.
The good days for the manufacturing sector are poised to continue this year and next, as output is forecast to expand by 2.8 per cent in 2019 and a still decent 1.6 per cent in 2020.
The report is cautious of the inaugural United Conservative budget that could scale back some of the province’s planned construction projects, including those in and around Red Deer.
Construction could begin this year on a $97-million justice centre. In addition, the provincial government announced earlier this year that it would provide Red Deer with $7 million to build a 120-bed homeless shelter.