July 2012

Tables and Analysis

Introduction

Based on statistical data for the second quarter of 2012, the Quebec City census metropolitan area (CMA) is maintaining its pace of growth. The labour market added 14,800 workers, driving the unemployment rate down to 5.3%. Work kicked off or continued on more than 100 major investment projects valued at nearly $8 billion. The tourist industry also got off to a good start, particularly in terms of hotel occupancy and airport use. The combined effect of these preliminary results will be conducive to real GDP growth (first-quarter GDP results are slated to be released later in August).

The Quebec City CMA’s fine performance largely stems from its diversity and the contributions made by its sectors of excellence. This is also a major contributing factor to the region’s growing international standing. To take but one example, Quebec City was named one of the world’s Top 7 Intelligent Cities in the prestigious ranking compiled by the Intelligent Community Forum (ICF) this year. Quebec City’s presence among the global elite confirms that research, innovation and creativity are the three hallmarks of the local economy.

Thanks to Quebec City’s sustained economic growth and international ascendancy, the region is very well positioned for the second half of 2012. The regional economy is sure to be put to the test over the coming months as global economic uncertainties continue to make headlines. In addition, new orders from the US will need more time before they pick up. North of the border, the level of household debt will still be a source of concern.

Employment Market

Employment Market

Based on non-seasonally adjusted data in Statistics Canada’s labour force survey, the Quebec City CMA had a total of 427,900 jobs in the second quarter of 2012, up 14,800 compared with the same period last year.

The services sector has been the main employment driver thus far in 2012. Quebec City had approximately 24,000 more jobs in this sector in the second quarter compared with last year. The vast majority of the sector’s components hired additional workers. As regards the construction industry, there is no shortage of work: nearly 100 residential and non-residential projects valued at more than $8 billion are underway. However, employment growth has tapered off despite the level of activity, which remains intense. In the regional manufacturing sector, the number of jobs dipped below the 30,000 barrier once again in the first half of this year. Due to weak global economic growth, some industries have been forced to trim their workforces, offsetting the improvements seen in 2011.

In economic terms, the Quebec City CMA turned in a robust performance in the first half of 2012, propelling it into a Canada-wide leadership position. The summer period should be no less favourable in this regard, particularly with the arrival of the peak period for several major projects and numerous festivities.

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Unemployment Rate

Unemployment Rate

The labour market’s strong performance in the Quebec City region helped drive the unemployment rate down to 5.3%, a drop of 0.5 points. The good start to the year bodes well for the region. The summer period could also prolong this upswing. A number of projects underway will be hitting their peak period, while road projects are set to resume, sparking demand for construction workers. 

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Capital Investment

Capital Investment

The Quebec City and Chaudière-Appalaches regions generated $10.2 billion in investments in 2011, for an annual growth rate of 2.6% (+6.2% in the province of Quebec). Taken together, the two regions accounted for 15.2% of capital expenditures in the province last year, good for third place.

According to the Quebec Institute of Statistics (ISQ), the outlook will remain more or less the same in 2012 for the Quebec City and Chaudière-Appalaches regions, which appear set to record investments totalling $10.4 billion. That will also be good for third place, just behind Montreal (21.1%) and Montérégie (16.6%).

The private sector invested $7 billion in the Quebec City and Chaudière-Appalaches regions in 2011, an annual increase of 5.8%. This growth will continue in 2012 due to the services sector’s predominant role. Buoyed by the strong Canadian dollar, manufacturing expenditures will hold steady, thereby supporting regional companies’ competitiveness and innovation. Meanwhile, the housing market will remain active due to various multi-phase projects and their multi-year investments.

Public-sector investment has increased by a factor of 2.5 in the region over the past five years (1.8 in the province of Quebec), boosting its relative weight from 25% to 39%. The many road and land use projects will serve to maintain public spending in 2012. 

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Venture Capital

Venture Capital

Venture capital investments in the Quebec City CMA topped $15 million in the first quarter of 2012, an annual increase of 134.5%. The life sciences and traditional sectors turned in standout performances with increases of 192.5% and of 95.2% respectively compared with the same period in 2011. The “other technologies” sector also performed well, posting annual growth of 10%.

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Demographic Snapshot

Demographic Snapshot

According to Statistics Canada’s latest census data, the Quebec City CMA was home to 765,706 people in 2011, up 6.5% from the 2006 census (+4.7% in the province of Quebec). Based on this fine performance, the region recorded the strongest growth in the province between the two census periods. In addition, the current results demonstrate that the metropolitan region may even be exceeding certain expectations. According to the ISQ’s “strong” scenario, the region is reportedly nearly one year ahead of the projection.

The improved demographic outlook reflects the natural increase (births less deaths) as well as a positive migratory balance. The number of births in Quebec City exceeds the number of deaths by more than 3,000 per year. This is primarily due to an ongoing baby boom (between 8,200 and 8,500 newborns per year). As regards the migratory balance, the Quebec City region welcomes more than 4,000 immigrants a year from other parts of Canada and from other countries. It should be noted that the number of international immigrants is approaching the 3,000 mark. The statistics also indicate that the region is a net attractor of people from other parts of Canada. Thanks to its robust economy, buoyant labour market, higher household incomes and good living conditions, the Quebec City region is increasingly attractive.

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