State of the Economy St. John's Metro

Transcription

1 State of the Economy St. John's Metro September 2017

2 Published by: Economic Development, Culture & Partnerships Division Department of Community Services City of St. John's Economic Updates (monthly), Economic Reviews and Outlooks (biannual) are also available in the publications section of the website or can be subscribed to by visiting the e-updates section. NOTE: Although every effort has been made to ensure the completeness and accuracy of the information contained in this publication, the City of St. John s does not guarantee, warrant or make any representations, express or otherwise, that the information contained herein is complete and correct. All numbers are nominal unless otherwise stated. Publication date: September

3 Table of Contents St. John s Census Metropolitan Area (CMA).. 5 Economic Indictors.. 6 St. John s CMA Economic Indicators Labour Force Characteristics. 7 Business Approvals Economic Growth and Oil Production Oil Production Major Projects in Newfoundland and Labrador Private Sector Projects City of St. John s Projects Public Sector Projects Real Estate Development Areas Housing Starts Average MLS Housing Prices Industrial Market Rental Rates Office Market Rental Rates Office Vacancy Rates Commercial and Residential Permits St. John s CMA Non-Residential Construction Labour Labour Force Participation Rate Annual Unemployment Rate Average Weekly Earnings

4 Table of Contents Demographic Population Census St. John s CMA Population Projections Demographic and Opinion Survey Other Businesses Insolvencies Consumer Insolvencies Businesses by Employment Size and NAICS Retail Sales. 44 Number of Businesses by Employee Size Out of Province Student Data.. 46 Accommodation Statistics Convention and Cruise Data Airport Passenger Data Port Data Outlook for Other Links

5 St. John's Census Metropolitan Area (CMA) St. John s Census Metropolitan Area (CMA) is a geographic area defined by Statistics Canada that includes St. John s and several neighbouring communities. St. John s CMA may also be referred to as St. John s metro throughout this document. Source: Department of Finance, Newfoundland & Labrador Statistics Agency 5

6 St. John's CMA¹ Economic Indicators 2016e 2017f % Change Real GDP (2007$M) 13,076 12, % Retail Trade ($M) 3,947 3, % Household Income ($M) 10,889 10, % Consumer Price Index (2002=100) % 1 St. John s Census Metropolitan Area (CMA) is a geographic area defined by Statistics Canada that includes St. John s and several neighbouring communities. St. John s CMA may also be referred to as St. John s metro throughout this document. Please refer to the following website for a map of St. John s CMA Table shows change from previous year. e: estimate; f: forecast Source: Statistics Canada; Economic and Project Analysis Division, Department of Finance, Government of Newfoundland and Labrador. 6

7 Labour Force Characteristics The St. John's metro unemployment rate is forecasted to increase by 0.3 percentage points to 8.1% in e 2017f % Change Labour Force (000s) Employment (000s) % Unemployment Rate 7.8% 8.1% 0.3 ppts Participation Rate 69.6% 68.1% 1.5 ppts Table shows change from previous year. e: estimate; f: forecast Source: Statistics Canada; Economic and Project Analysis Division, Department of Finance, Government of Newfoundland and Labrador. 7

8 Business Approvals This table represents the number of both general and home based business approvals in the City of St. John s Home Based Businesses General Total Source: City of St. John s 8

9 Economic Growth and Oil Production Real GDP growth in the St. John s CMA is sensitive to changes in oil production. The majority of oil industry activity is resident in the area, therefore most of the province s oil-related Real GDP is allocated to the CMA. Real GDP Growth With and Without Oil & Gas St. John's CMA (%) With Oil & Gas Excluding Oil & Gas Source: Economic and Project Analysis Division, Department of Finance, Government of Newfoundland and Labrador, March

10 Oil Production The Hebron project is scheduled to begin oil production in Exploration continues with recent discoveries, including Bay du Nord. Source: Canada-Newfoundland and Labrador Offshore Petroleum Board (C-NLOPB), January

11 Major projects in Newfoundland & Labrador These major projects in NL are making significant investments and contributing to the local economy. Project Hebron Offshore Oil Development ( ) Lower Churchill Phase 1, Muskrat Falls Hydroelectric Generation Facility ( ) Vale Long Harbour Nickel Processing Facility ( ) Husky Energy West White Rose Project ( ) Canada Fluorspar St. Lawrence Mine ( ) Iron Ore Company of Canada Wabush 3 Mine ( ) Value $14.0 B $9.4 B $4.3 B ($US) $3.2 B $250.0 M $79.0 M Note : This is not a complete list of Major Projects. Source: Economic and Project Analysis Division, Department of Finance, Government of Newfoundland and Labrador, Project Proponent 11

12 Private Sector Major Projects Millions of dollars in ongoing private sector developments in the City of St. John s. Project $10Million St. John's International Airport Capital Plan $245.0 Galway and Glencrest Development , Phase One $102.0 Alt Hotel, 123 Water Street $35.0 Star of the Sea Condos, 40 Henry Street $22.0 St. John s Harbour Upgrade Project, Irving Oil $20.0 Best Western Plus St. John s Airport Hotel $17.0 MIX residences, 345 Duckworth Street $15.4 Sandman Hotel, 227 Kenmount Rd. $10.6 Micro Boutique Living, 12 Water Street $10.0 Note: Table is not a complete list of all projects. Source: City of St. John s, Economic and Project Analysis Division, Department of Finance, Government of Newfoundland and Labrador, Project Proponent 12

13 City of St. John s Projects City of St. John s continues to make capital investments. Project Water Transmission Main Replacement Program ( ) $3Million $34.0 Bay Bulls Big Pond Water Treatment Facility Upgrade $12.0 Kenmount Terrace Park $10.0 City of St. John s Street Rehabilitation Program 2016 $9.8 Metrobus Capital Works $6.1 St. Patrick s Housing Project $4.6 Community Market, 245 Freshwater Rd. $3.7 Note: Table is not a complete list of all projects. Source: City of St. John s 13

14 Public Sector Projects Millions of dollars in public sector investments are ongoing in the City of St. John s. Project >$15 Million Memorial University Core Science Facility ( ) $325.0 Team Gushue Highway Extension ( ) $61.3 Atlantic Region Coast Guard Headquarters ( ) $40.0 Memorial University Battery Facility ( ) $25.6 Colonial Building Restoration ( ) $22.2 St. John s Port Authority Pier 17 West Expansion ( ) $12.8 Note: Table is not a complete list of all projects. Source: City of St. John s, Economic and Project Analysis Division, Department of Finance, Government of Newfoundland and Labrador, Project Proponent 14

15 Development Areas Growth areas offer significant residential and commercial development. Harvey s Power Centre, east side of Torbay Road Field Power Centre, west side of Torbay Road Glencrest Industrial Centre, Phase One Galway residential and retail For location and further information: Map: City of St. John s 15

16 Housing Starts St. John s CMA housing starts decreased by 15% to 833 units in In the City of St. John s, housing starts declined to 294 units. Housing Starts - City of St. John's and St. John's CMA CMA St. John's , Note: CMA housing starts include St. John's housing starts. Source: Canada Mortgage and Housing Corporation (CMHC) 16

17 Average MLS ¹ Housing Prices The average MLS almost doubled from 2007 to 2014, then decreasing to $305,763 in 2016². Average MLS Housing Price in St. John's CMA Thousands $ MLS (Multiple Listing Service) is a registered trademark of the Canadian Real Estate Association (CREA). ² CREA has made changes to the way the historical series is aggregated so prices are different from previous editions of the State of the Economy. Source: CMHC, adapted from MLS data. 17

18 Industrial Market Rental Rates Industrial market rental rates remained on par with the previous year at $14.36 per sq. ft. and the vacancy rate increased to 18.7% in January $16.00 $14.00 First Quarter Gross Rental Rate and Vacancy Rate, Industrial St. John's CMA % 18.7% 20.0% 18.0% $ % 14.0% $ % 9.9% 12.0% $8.00 $6.00 $ % 5.2% 6.3% 7.3% 5.6% 5.9% 4.9% 10.0% 8.0% 6.0% 4.0% $ % $ % Source: Cushman & Wakefield Atlantic 18

19 Office Market Rental Rates Office market rental rates decreased slightly to $34.95 per sq. ft. in the first quarter of 2017 and have increased 84% over the last ten years. First Quarter Gross Rental Rate St. John's $40 $30 $24.57 $27.50 $29.11 $31.05 $33.10 $34.63 $35.09 $34.95 psf/yr $20 $19.05 $18.58 $20.70 $10 $ Source: Cushman & Wakefield Atlantic 19

20 Office Vacancy Rates Overall office vacancy rates rose in 2017, reaching 19.8%, an increase of 48% from Q An additional 358,028 sq. ft. of office space has been completed and occupied over the last couple of years. % st Quarter Office Market Overall Vacancy St. John's CMA (%) * Class A buildings in St. John's are: Baine Johnson Building, Fort William Building, Cabot Place, lll Fifty One Water Street, Fortis Place and Scotia Centre. Source: Cushman & Wakefield Atlantic, Altus Group 20

21 Commercial & Residential Permits The value of commercial building permits in St. John s was $131 million in 2016 while residential and repair permits were $98.2 million. Value of Construction from Commercial and Residential Building Permits City of St. John's, , $Millions 300 Com Res 200 $Millions Com = Commercial Permits; Res = Residential and Repair Permits Source: City of St. John's 21

22 St. John s CMA Non-Residential Construction Investment in non-residential* building construction in the St. John s CMA reached $51 million in the second quarter of 2017, down 28% from the second quarter of Source: Statistics Canada. * The investment in non-residential building construction represents the spending value for enterprises and governments, for industrial, commercial and institutional buildings. It excludes engineering work (bridges, roads, electrical dams, etc.). 22

23 Labour Force Participation Rate St. John s CMA labour force participation rate increased slightly (0.3 ppts) to 69.6% in 2016 and remained higher than the national rate (65.7%). Labour Force Participation Rates (%) St. John's CMA vs Canada % St. John's CMA Canada Source: Statistics Canada; Economic and Project Analysis Division, Department of Finance, Government of Newfoundland and Labrador. 23

24 The annual unemployment rate in the St. John's CMA was 7.8% in The rate in Canada was 7.0%. 16 Annual Unemployment Rate Annual Unemployment Rate (%) St. John's CMA Source: Statistics Canada; Economic and Project Analysis Division, Department of Finance, Government of Newfoundland and Labrador. 24

25 Average Weekly Earnings Average weekly earnings increased 4% in 2017 to $991. The consumer price index increased 2.2% to between January 2016 to January Average January Weekly Earnings St. John's CMA $1,100 $1,000 $900 $800 $748 $805 $860 $913 $949 $1,003 $998 $953 $991 $700 $781 $600 $640 $ Source: Canada Mortgage and Housing Corporation (CMHC), adapted from Statistics Canada (CANSIM) 25

26 City of St. John s St. John s CMA 2011 Census 2016 Census % Change 2011 Census 2016 Census % Change Total Population 106, , % Total Population 196, , % Ages , , % Ages ,250 32, % Ages , , % Ages , , % Ages ,595 17, % Ages ,055 30, % Occupied Private Dwellings 47, % Occupied Private Dwellings 85, % Source: Statistics Canada, 2011 and 2016 Census of Population. 26

27 St. John s CMA Population Projections The percentage of the population of Newfoundland and Labrador living in St. John s CMA continues to grow. Source: Government of Newfoundland and Labrador, Department of Finance, Economic Research and Analysis Division, Population Projections, medium scenario,

28 St. John s CMA Population Projections It is forecasted that the number of households will increase at a greater rate than the population. Source: Government of Newfoundland and Labrador, Department of Finance, Economic Research and Analysis Division, Population Projections, medium scenario,

29 St. John s CMA Population Projections An Aging Population: The portion of the population aged 65 and over grows while the age group declines. Source: Government of Newfoundland and Labrador, Department of Finance, Economic Research and Analysis Division, Population Projections, medium scenario,

30 St. John s CMA Population Projections Population growth forecasted in the City of St. John s and St. John s CMA. Source: Government of Newfoundland and Labrador, Department of Finance, Economic Research and Analysis Division, Population Projections, medium scenario,

31 Demographic and Opinion Survey The City of St. John's and partner municipalities undertook a residential survey administered in 2016 to gather information and perspectives from residents. People who visit downtown St. John s on a monthly basis or more (Excludes those who live downtown) 72.2% 74.1% St. John s CMA City of St. John s Source: Newfoundland & Labrador Statistics Agency, St. John s CMA Demographic Profile Survey Results for St. John s CMA are accurate at a 95% confidence level with a margin of error of +/- 1.6%. Results for City of St. John s are accurate at a 95% confidence level with a margin of error of +/- 2.3%. Percentages may not sum to 100% due to rounding and/or non-response. The survey was administered between February and July, 2016 to municipalities in the St. John s Census Metropolitan Area (CMA). 31

32 Demographic and Opinion Survey Purpose of visits to downtown St. John s Source: Newfoundland & Labrador Statistics Agency, St. John s CMA Demographic Profile Survey Results for St. John s CMA are accurate at a 95% confidence level with a margin of error of +/- 1.6%. Results for City of St. John s are accurate at a 95% confidence level with a margin of error of +/- 2.3%. Percentages may not sum to 100% due to rounding and/or non-response. The survey was administered between February and July, 2016 to municipalities in the St. John s Census Metropolitan Area (CMA). 32

33 Demographic and Opinion Survey St. John s CMA City of St. John s Source: Newfoundland & Labrador Statistics Agency, St. John s CMA Demographic Profile Survey Results for St. John s CMA are accurate at a 95% confidence level with a margin of error of +/- 1.6%. Results for City of St. John s are accurate at a 95% confidence level with a margin of error of +/- 2.3%. Percentages may not sum to 100% due to rounding and/or non-response. The survey was administered between February and July, 2016 to municipalities in the St. John s Census Metropolitan Area (CMA). 33

34 Demographic and Opinion Survey St. John s CMA City of St. John s Source: Newfoundland & Labrador Statistics Agency, St. John s CMA Demographic Profile Survey Results for St. John s CMA are accurate at a 95% confidence level with a margin of error of +/- 1.6%. Results for City of St. John s are accurate at a 95% confidence level with a margin of error of +/- 2.3%. Percentages may not sum to 100% due to rounding and/or non-response. The survey was administered between February and July, 2016 to municipalities in the St. John s Census Metropolitan Area (CMA). 34

35 Demographic and Opinion Survey Number of Persons in Household St. John s CMA City of St. John s 11.3% 15.7% 33.1% 35.7% 20.9% 20.0% 25.1% 20.9% 7.4% 5.7% 2.0% 1.7% 44.4% of households in St. John s CMA and 51.4% of households in City of St. John s have two or fewer people. Source: Newfoundland & Labrador Statistics Agency, St. John s CMA Demographic Profile Survey Results for St. John s CMA are accurate at a 95% confidence level with a margin of error of +/- 1.6%. Results for City of St. John s are accurate at a 95% confidence level with a margin of error of +/- 2.3%. Percentages may not sum to 100% due to rounding and/or non-response. The survey was administered between February and July, 2016 to municipalities in the St. John s Census Metropolitan Area (CMA). 35

36 Demographic and Opinion Survey People that reported a household income of under $100,000 St. John s CMA City of St. John s 45.8% 51.1% People that reported a household income of under $50,000 St. John s CMA 20.4% City of St. John s 25.3% Source: Newfoundland & Labrador Statistics Agency, St. John s CMA Demographic Profile Survey Results for St. John s CMA are accurate at a 95% confidence level with a margin of error of +/- 1.6%. Results for City of St. John s are accurate at a 95% confidence level with a margin of error of +/- 2.3%. Percentages may not sum to 100% due to rounding and/or non-response. The survey was administered between February and July, 2016 to municipalities in the St. John s Census Metropolitan Area (CMA). 36

37 Demographic and Opinion Survey Employment Status St. John s CMA City of St. John s Retired or do not work 25.7% 28.1% Employed (Full time, part time, casual/seasonal, etc.) 63.4% 60.6% Of those employed Type of Employment St. John s CMA City of St. John s Employed full time 53.5% 50.9% Self employed 13.1% 13.5% Employed directly or indirectly in the oil and gas, mining, and energy sectors 15.5% 12.9% Source: Newfoundland & Labrador Statistics Agency, St. John s CMA Demographic Profile Survey Results for St. John s CMA are accurate at a 95% confidence level with a margin of error of +/- 1.6%. Results for City of St. John s are accurate at a 95% confidence level with a margin of error of +/- 2.3%. Percentages may not sum to 100% due to rounding and/or non-response. The survey was administered between February and July, 2016 to municipalities in the St. John s Census Metropolitan Area (CMA). 37

38 Demographic and Opinion Survey Living in your Community St. John s CMA City of St. John s Have lived in current community for 20+ years 45.7% 50.8% Have lived in current municipality less than five years 14.1% 13.9% Indicated they may move within the next five years 21.2% 22.4% Of those who said they may move in next five years, would stay within their current municipality 45.6% 45.7% Source: Newfoundland & Labrador Statistics Agency, St. John s CMA Demographic Profile Survey Results for St. John s CMA are accurate at a 95% confidence level with a margin of error of +/- 1.6%. Results for City of St. John s are accurate at a 95% confidence level with a margin of error of +/- 2.3%. Percentages may not sum to 100% due to rounding and/or non-response. The survey was administered between February and July, 2016 to municipalities in the St. John s Census Metropolitan Area (CMA). 38

39 Demographic and Opinion Survey People that get to work by automobile St. John s CMA City of St. John s 93.7% 88.8% People that can get to work in under 20 minutes St. John s CMA People that can get to work in under 15 minutes City of St. John s 70.4% 66.4% Source: Newfoundland & Labrador Statistics Agency, St. John s CMA Demographic Profile Survey Results for St. John s CMA are accurate at a 95% confidence level with a margin of error of +/- 1.6%. Results for City of St. John s are accurate at a 95% confidence level with a margin of error of +/- 2.3%. Percentages may not sum to 100% due to rounding and/or non-response. The survey was administered between February and July, 2016 to municipalities in the St. John s Census Metropolitan Area (CMA). 39

40 Demographic and Opinion Survey Residents were asked about their quality of life and city services. Source: Newfoundland & Labrador Statistics Agency, St. John s CMA Demographic Profile Survey Results for St. John s CMA are accurate at a 95% confidence level with a margin of error of +/- 1.6%. Results for City of St. John s are accurate at a 95% confidence level with a margin of error of +/- 2.3%. Percentages may not sum to 100% due to rounding and/or non-response. The survey was administered between February and July, 2016 to municipalities in the St. John s Census Metropolitan Area (CMA). 40

41 Businesses Insolvencies The number of proposals and bankruptcies filed by businesses in the St. John s CMA. Source: Office of the Superintendent of Bankruptcy Canada 41

42 Consumers Insolvencies The number of proposals and bankruptcies filed by consumers in the St. John s CMA. Source: Office of the Superintendent of Bankruptcy Canada 42

43 Businesses by Employment Size and NAICS* Source: Statistics Canada, Business Register *North American Industrial Classification System 43

44 Retail Sales Slower growth in household income resulted in retail sales of $3.9 billion in 2016, on par with Retail Sales ($B) - St. John's CMA $3.88 $3.91 Billions $ $3.03 $3.12 $3.25 $3.44 $3.74 $3.91 $ $ Source: Statistics Canada; Economic and Project Analysis Division, Department of Finance, Government of Newfoundland and Labrador. 44

45 Number of Businesses by Employee Size 84% of businesses in St. John s CMA have fewer than 20 employees. # of businesses by Employment Size Range St. John's CMA 2016 (n=6,943) 12.7% 2.5% 0.7% 50.3% 33.8% 1 to 4 5 to to to Source: Statistics Canada, Business Register 45

46 Out of Province Student Data Approximately 32% of the 17,422 students enrolled at Memorial University in 2016 were from out of province. International student enrolment increased 6.7% over Number of International and Other Canadian Students Enrolled at MUN, Fall Semesters Other Canadian International Source: Center for Institutional Analysis and Planning, Memorial University. 46

47 Accommodation Statistics St. John's average hotel occupancy rate was 60.36% in 2016, down from 62.95% in Room nights available increased to 939,909 from 892,368 in The average rate was $ per night in 2016, in 2015 it was $ Note: These numbers reflect all room nights including major hotels, boutique hotels, and B & Bs. An increase in room nights available in 2016 has affected the comparison of occupancy rates slightly. Source: Destination St. John s 47

48 *Meetings and conventions of greater than 50 people Note: The St. John s Convention Centre was closed from fall of 2014 to spring 2016 for construction Source: Destination St. John s, City of St. John s Convention Delegates* 24,490 21,215 24,098 Number of ship visits Number of Passengers ,775 16,756 15,439 48

49 Airport Passenger Data Passenger traffic increased 4.3% in 2016 to 1.6 million. Airline Passenger Movements at St. John's International Airport (000's) Thousands Source: St. John's International Airport Authority and Transport Canada 49

50 Port Data The number of vessel arrivals increased to 1,436 in 2016 while total port cargo decreased. Thousands St. John's Total Port Cargo (metric tonnes) (000's) St. John's Port Vessel Arrivals Note: vessel arrivals exclude non-commercial, e.g., Department of National Defence and small commercial vessels entering the Port of St. John s. Source: St. John's Port Authority 50

51 Outlook for 2017 The economic outlook for St. John s CMA is expected to remain subdued in There will be a significant decline in capital investment as the Hebron and Long Harbour projects move past peak construction, although capital investment will remain high in a historical context. Government deficit reduction measures are expedited to curtail expenditures in the public sector. Source: Statistics Canada; Government of NL, Department of Finance, Economic Research and Analysis Division. 51

52 Other Links For more information, visit the following links to access other economic reports. nomic%20update%20july.pdf % pdf 52