Moncton’s Healthy Local Economy and Business Growth Positions Hub City a Consistent Performer in NB, Maritimes
In looking at the larger economic picture for the City of Moncton’s economy, the strong results in 2003 coming on the heels of record breaking levels of employment and investment in 2002 has established New Brunswick’s largest bilingual city, and surrounding urban area, as a remarkable economic performer in Atlantic Canada.
Economic indicators and business investment levels posted during 2003 are confirming Moncton’s year over year growth pattern, as a model trend line of business vitality across Atlantic Canada. Economic indicators are drawn from Moncton Census Aggregate ( Moncton CA) for the purposes of economic activity reporting agencies.
During 2003, the steady creation of jobs and business expansion in the local market drew national attention when Moncton CA’s unemployment rate dipped to 4.6%, in October, when compared to a level of 5.7% a year ago, according to Statistics Canada reports that are a three-month moving average unadjusted for seasonal variation.
Analysts comparing unemployment rates in communities across Canada conclude that the Moncton region in late 2003 is experiencing the lowest unemployment rate of any published area east of Ontario.
Statistics Canada issued projections showing that there were 3,300 people looking for work in the Moncton CA in October 2003 and 67,600 working. In the previous October of 2002, which was considered a banner economic growth year for the Moncton CA, the agency recorded that there were 4,000 people looking for work and 66,000 working.
The conclusion from the previous year October to October continues to show Moncton gaining employment from job creation and declining numbers of people looking or available for work.
"Moncton is up by 1,600. It is reversing the trend that we saw the last few months," said Samuel LeBreton. LeBreton is a senior economist in New Brunswick with the federal department of human resources development and periodically releases employment analysis and statistics that are published in provincial media.
For the Province of New Brunswick, the Moncton figures are even greater in contrast where the province made modest gains in the fall of 2003 with the labour force growing by 1,500 as recorded in October, but only two-thirds of them actually found work, according to the publicized Statistics Canada report. New entrants in the provincial job market pushed the unemployment rate to 10.8 per cent from 10.7 per cent in September, while the actual employment rate also edged up slightly to 56.3 per cent from 56.2 per cent a month earlier.
New Brunswick’s labour force grew to 385,300, pushing the participation rate for the province above 63 per cent. The participation rate is the percentage of the population 15 and over who are active in the labour force either working or looking for work.
New Brunswick has the second-highest participation rate in Atlantic Canada. Prince Edward Island has a participation rate of 68 per cent, while the national rate is 67.5 per cent. Summarizing the figures for all of New Brunswick, LeBreton noted that Moncton is improving in both lower unemployment levels and high employment levels, while the rest of the province is weakening. And the pace of employment growth is projected to remain strong for the rest of the year in Moncton and into the new year.
In September, Manpower Temporary Services released a forward looking employment intentions survey conducted among Moncton area employers and results indicate that the hiring pace that has been a strong source of economic growth for the CA in 2002 and in 2003 is projected to continue through to the end of the year.
All indications are that employment levels in the Moncton area are continuing to grow and according to housing industry experts, this steady growth in employment and historic low interest rates are combining to create a vibrant retail and construction marketplace in Moncton.
The residential and retail building expansion around Moncton continues to set records. Early economic indicators project that Moncton will be one of eight urban markets in Canada, which are expected to surpass previous sales records by the end of 2003.
Analysts’ published commentary include Moncton as one of only eight Canadian urban areas that is performing at a level of real estate sales that will exceed last year's record- setting pace in number of units moving and in price gains. A recent study released by one of Canada’s largest residential real estate companies ReMax Realty also projects a bright economic future for Moncton.
The ReMax study included Moncton, among 8 healthy growth markets including: Moncton, Fredericton, Kelowna, Edmonton, Toronto, Ottawa, London and Montreal. These communities are projected by the ReMax study to exceed unit sales records set previous to 2003, which is a banner year and 2004 is predicted to be another record breaker.
The Re/Max report estimates the average price for residential housing in Moncton, which averages in everything from a mini-home to 250,000-and up homes, is $104,000, a hike of four per cent over last year's mark of $99,942. It projects the average will increase again by five per cent in 2004 to $107,650.
It also estimated that 1,500 housing units will be sold in Moncton this year, a five per cent boost over the 2003 mark of 1,428. The report predicts the number will increase again next year to 1,575 units sold in the city, an increase of 4.5 per cent.
Maurice Babineau, past-president of the Greater Moncton Real Estate Board, says Metro Moncton recorded a phenomenal $151,449,534 in residential sales over the first nine months, with the last quarter’s sales volume yet to be added. According to Babineau, the total value of residential sales in the area was $142,666,427 over the same period last year, which represents an increase of $8,783,107 or six per cent.
"We are absolutely headed towards a record year, coming on top of a previous year, which was also record setting. We anticipate that this year's record will be broken in 2004, because I don't see it slowing down. Our economy is strong, there are lots of jobs and a lot of people are moving into the area,” says Babineau.
Ben Champoux, New Brunswick’s senior market analyst for Canada Mortgage and Housing Corporation (CMHC) concurs “Real estate agents will enjoy a record in 2003 as demand remains strong and supply of existing homes available for sale is on the rise, as indicated by an increased number of listings on the Multiple Listing Service (MLS)” says Champoux. At the end of September, active listings were already 12.2% above last year’s levels.
CMHC's senior market analyst also predicts an increase in both MLS® sales and average sales price in 2004. Champoux says that many key factors are in place in Metro Moncton to maintain a vibrant housing market.
"Besides a rise in new residential listings, strong consumer confidence, employment growth (mainly full-time jobs), positive net migration, and near 50-year low mortgage rates are all key factors that will stimulate housing demand again next year in Greater Moncton," says Champoux.
As Champoux explains it, residential construction is a clear indicator of a robust economy. As a result, it is fair to say that Greater Moncton is enjoying solid economic growth.
Single housing starts were already 14% ahead of last year’s levels, representing a 30-year high for that 10-month period. The construction of multiple dwellings has performed very well in historical terms. At the end of October, semi-detached starts reached 126 units compared to 70 units last year, while row housing starts reached 31 units compared to 9 units in 2002. As for apartments, 345 units were started over the first nine months of 2003, a significant decline when compared to the 477 units started over the same period last year. “However, at 345 units, the January-September 2003 period still represents the second highest in nearly 30 years”, says Champoux.
Not only is employment on the rise in Greater Moncton, but also a higher ratio of full-time jobs has caused an increase in the average household income. Moncton is recording an increase in full-time jobs, and near 50-year low mortgage rates have allowed many renters to consider owning their own homes.
Furthermore, these potential first-time buyers are now taken advantage of a broader inventory of existing homes available on the resale market. The rise in listings is due to the fact that an increased number of seniors and empty nesters are taking advantage of the new high-end apartment units on the market to sell their homes and move into luxury apartments.Previous