The Sault’s economy will bounce back this year, says Conference Board of Canada

NEWS RELEASE

CONFERENCE BOARD OF CANADA

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OTTAWA - (July 27, 2016) - Timmins’ economy will remain healthy this year. Meanwhile, Sault Ste. Marie’s economy is expected to strengthen this year, albeit modestly, according to The Conference Board of Canada’s Mid-Sized Cities Outlook 2016.

“Timmins’ outlook continues to be positive, thanks to ongoing strength in region's mining industry and manufacturing,” said Alan Arcand, Associate Director, Centre for Municipal Studies, The Conference Board of Canada. “For Sault Ste. Marie, a recovery in transportation and warehousing and rising non-residential construction will help the city post modest growth over the next two years.”

Highlights

• Timmins’ economy is forecast to grow by 1.9 per cent this year.
• Sault Ste. Marie’s economy is expected to post real GDP growth of 0.7 per cent this year.
• Timmins and Sault Ste Marie should see job growth of 7.3 per cent and 9 per cent respectively in 2016, following big losses in 2015.

Sault Ste. Marie

Sault Ste. Marie’s economy is expected to post real GDP growth of 0.7 percent this year, following a flat reading in 2015.

Gains in non-residential investment will drive a recovery in the city's construction sector. Many projects are underway in the metro area, including the Sault College’s multi-million dollar rebuild of its Northern Avenue campus.

Unfortunately, the outlook is not as bright for residential construction sector, as a slowly declining population will limit demand for new homes. All told, the city’s construction sector should grow by a modest 0.8 percent this year.

On the other hand, with the steel industry still facing pressure from a slower global economy and market overcapacity, the city’s manufacturing sector is set to contract by 0.3 percent this year.

Despite persistent declines on the goods side of the economy, Sault Ste. Marie's services sector has kept on expanding, albeit weakly. This year, services sector output growth is forecast to improve to 0.8 percent in 2016.

In particular, the modest expansion in construction activity should provide a lift to Sault Ste. Marie’s transportation and warehousing sector, which is slated to post growth for the first time in five years.

Employment, which fell by a record 18 percent last year, is expected to rebound with a 9 percent gain in 2016.

Timmins

Timmins economy has seen healthy growth in recent years and this is expected to continue into 2016. Timmins' primary and utilities sector, which includes mining activity, will remain busy in 2016.

Lake Shore Gold and Tahoe Resources, which have agreed to combine their business operations, should begin work soon on deepening the shaft at the Bell Creek mine, while Goldcorp Porcupine continues its work at the Hollinger open pit mine. In all, output in the primary and utilities sector is projected to grow by 2.2 per cent in 2016.

The local manufacturing sector has been benefiting from the growing mining industry.

This year, the industry is expected to grow at a slower but still healthy pace of 2.8 percent.

Healthy mining and manufacturing activity will help drive a recovery in Timmins' transportation and warehousing sector which is, expected to expand by 1.2 percent in 2016.

Things are also looking up for Timmins’ construction sector, with output forecast to rise 2.9 percent this year. The city is set to receive $3 million through the provincial Connecting Links program to reconstruct part of Highway 101.

All told, Timmins’ real GDP is forecast to expand by 1.9 percent, allowing job growth to jump 7.3 percent this year, almost fully offsetting a 7.4 percent decline in 2015.

The Mid-Sized Cities Outlook 2016 provides economic forecasts for seven cities that contributed financially to the research — Timmins, Sault Ste. Marie, Brandon, Lethbridge, Red Deer, Medicine Hat, and Prince George.

The report also includes historical economic and employment data for 31 mid-sized Canadian cities.

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