Greater Victoria’s economy should grow this year and do nearly as well in 2016, according to a study by the Conference Board of Canada.
The board’s autumn metropolitan outlook forecasts the region’s economy to grow by 1.4 per cent this year and 2.6 per cent next year after a weak 2014, when the economy grew by just 0.6 per cent. “As a provincial capital, Victoria has struggled in the face of provincial government fiscal restraint.” said the board’s Alan Arcand.
“The local economy has grown little in recent years, but things are looking up.
“The provincial government is in a stronger fiscal position, which bodes well for the outlook in Victoria’s largest sectors: non-commercial services and public administration.”
The report suggested Victoria’s manufacturing sector, led by the shipbuilding industry, would again be a driving force.
The board forecasts growth of about seven per cent in that sector alone this year.
Bruce Carter, chief executive of the Greater Victoria Chamber of Commerce, who has often disagreed with the board’s findings, said this report seems to have a better handle on the Victoria economy.
“But they are putting a lot of weight on shipbuilding. I think our [manufacturing] sector is deeper than that,” he said, pointing to the industrial manufacturing being done on the Saanich Peninsula at places such as Viking Air and Nicholson Manufacturing.
“In 2014, we were ranked 13th [among Canadian cities] and this year we should be 10th. Our economy should grow by 1.4 per cent [and] that’s twice the growth of last year. That’s good and the trend line is in the right direction,” Carter said.
He said Victoria could outpace the board’s predictions if it gets some improved growth in the public sector and a bigger bump from a very strong tourism year.
“[Tourism] is so highly visible, as it’s reflected in people downtown and people in restaurants, so I think it will have more of an effect on consumer confidence than they are allowing for in this report,” Carter said.
The board believes Victoria’s public administration sector is not out of the woods and could contract by 1.2 per cent this year, the sixth straight annual decline. However, it forecasts recovery in that realm for 2016 with 2.1 per cent growth.
The non-commercial services sector, which includes health care and education, is expected to bounce back this year with 1.8 per cent growth after a two per cent contraction last year.