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Economic reports and outlooks-Québec City CMA, 2013-2014
 

Economic reports and outlooks-Québec City CMA, 2013-2014

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In addition to addressing key economic indicators for assessing regional performance, this study takes an objective look at the results achieved in 2013 and those expected for 2014. Changes in a ...

In addition to addressing key economic indicators for assessing regional performance, this study takes an objective look at the results achieved in 2013 and those expected for 2014. Changes in a number of regional economic variables are also compared with those of seven other metropolitan areas in Canada. Study onducted by Québec International.

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    Economic reports and outlooks-Québec City CMA, 2013-2014 Economic reports and outlooks-Québec City CMA, 2013-2014 Document Transcript

    • ECONOMIC REPORTS AND OUTLOOKS Québec City CMA 2013 2014
    • quebecinternational.ca
    • 3 TABLE OF CONTENTS Methodology . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .2 Note to readers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .2 Summary. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .3 Economic growth . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .4 Purchasing power . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .6 Labour market . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .8 Non-residential investment. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .10 Housing market . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12 Demographics . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .14 Tourism . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16 Appendix 1 Primary economic indicators of the Québec City CMA . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .18 Appendix 2 Major projects underway and planned in the Québec City CMA . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20 Appendix 3 List of major private sector employers by activity area in the Québec City CMA . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .22 Glossary. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .23 2013 2014 ECONOMIC REPORTS AND OUTLOOKS Québec City CMA
    • Methodology This study, entitled Economic Report and Outlooks for the Québec City Census Metropolitan Area - 2013-2014, was conducted by Québec International. In addition to addressing key economic indicators for assessing regional performance, it takes an objective look at the results achieved in 2013 and those expected for 2014. Changes in a number of regional economic variables are also compared with those of seven other metropolitan areas in Canada: Montréal, Toronto, Ottawa, Winnipeg, Calgary, Edmonton and Vancouver. These benchmark regions were selected because, together with Québec City, they form the eight largest metropolitan areas in Canada and because they have diversified economies comparable to that of the Québec City Census Metropolitan Area (CMA). Seven key indicators were selected for this analysis: economic growth, purchasing power, labour market, non-residential investment, housing market, demographics and tourism. The appendix lists the major projects underway in the Québec City region, the major regional employers as well as historical data on the economic indicators analyzed. This study is based on statistical data published by recognized organizations. Some indi- cators were processed and analyzed in order to establish forecasts for 2014. Note to readers This study was produced by Québec International’s Department of Economic Studies & Strategic Monitoring. This team of professionals is responsible for ensuring the availability of high-quality economic information. To that end, they monitor changes in the economic and business environment at the regional, national and international levels and conduct various types of research and analysis in order to identify opportunities, guide development strategies and define actions to be taken in support of regional economic growth. The information in this study was current as at April 2014.
    • ECONOMIC REPORTS AND OUTLOOKS Québec City CMA 2013 2014 5 The economy of the Québec City CMA has positioned itself as one of the best performing economies in Canada these last few years. The growth strategies introduced to support the knowledge economy and to stimulate involvement by the private sector have proven to be wise. Today, the area displays the appropriate industrial diversity to sustain its growth, but also has the ability to adjust to the hazards of the world economy. Recent updates reveal that the real GDP recorded an 8.7% growth over 5 years. The labour market was just as vigorous with the creation of 28,100 jobs during the same period. Furthermore, regional economic expansion boosted non- residential investment to a record level at close to $1.2G in 2013. The energy and efforts applied these last years to give the Québec City area a strong economic profile will be used as leverage to traverse a less expansionist economic period. Initial signs started to point in this direction in 2013. The annual GDP increase was less than 2% (1.2%) for the second consecutive year. The job market remained stable compared to 2012. In addition, a slowdown has taken hold in the residential sector. Last year’s results revealed that the Québec City economy remains in good health, but certain restrictions are impacting its performance. The manufacturing industry suggests signs of recovery in terms of employment, including the sustainable goods sector (+ 8.1% in 2013), while revenues from companies struggling to recover are due to a still-fragile global economic recovery. As demonstrated by the low unemployment rate of 4.7% and the high employment rate of 65.1%, the need for manpower is intensifying. However, the scarcity of qualified and available workers is an irritant for companies wishing to expand or fill vacant jobs. The regional demographic profile continues to improve and is exceeding expectations, a positive factor for consumption. However, the population is ageing and the proportion of international migrants remains less than the representative weight of Québec City at the provincial level. It appears that the economic structure for the Québec City CMA has forged itself is an important lever to start the next decade. Considerable efforts will continue to be deployed to support strong sectors and enhance the competitiveness of companies. Furthermore, socio-economic players are asserting their desire to improve the regional business environment by modernizing transportation, education, R & D, and telecommunications infrastructure, as well as industrial parks and zones. It should be noted that in its 2014 Competitive Alternatives, KPMG revealed that Québec City stood out for its competitive cost-benefit ratio 9.3% lower than the United States average. This is a clear improvement over 2012, when this advantage was 5.8%. Québec City thus ranked 6th worldwide among the 107 areas analyzed and 1st among areas of comparable size (500,000 to 2 million inhabitants). SUMMARY
    • 1 6 ECONOMIC GROWTH The Québec City metropolitan area generated a GDP of $33.1G in 2013, an increase of 1.2% over 2012. While we had banked on an annual increase of 1%, the area slightly exceeded our growth expectations. The resumption of more sustained employment in the fourth quarter led to an influx of energy at the end of the year. Québec City thus posted growth comparable to major Canadian CMAs located further to the East. However, ease in the residential sector and the decline in manufacturing revenues have forced the region to record less than its average 2% performance these past 5 years. The services sector set the pace in 2013 with a 2.1% growth over 2012. Its production services component generated 76% of the new revenues. The dynamism that mainly surrounds finance, insurance, professional services including scientific and technical services, business services and the transportation industry should support growth in this sector in 2014. In addition, public administration accounted for 32% of the earnings of the service sector last year. It remains a significant hub of activity for the area and continues to adjust to the various constraints related to the efforts of governments to limit their spending increases. Finally, the consumer services component limited its contribution to 2% of last year’s growth. This is only a postponement since the expansion of the retail trade and work surrounding the upgrading of some recreational infrastructure suggest an improvement for 2014. Meanwhile, the construction industry registered a slight decrease of 0.3% last year. The non-residential sector outperformed, while the amounts invested reached a peak of $1.2G, an annual increase of 23%. However, the residential sector slowed from 6,416 housing starts in 2012 to 4,680 in 2013. The residential sector will continue to ease in 2014, but the construction industry will remain, overall, dynamic and diversified in Québec City. The region currently has nearly 300 current and announced projects for a value of $9.5G. For its part, the manufacturing sector has delayed its recovery for another year, while it posted a decline of 7% in 2013. The stability of the labour market, combined with the gradual resumption of new orders in recent months, suggests a gradual recovery for the processing sector in 2014. To this end, activities resumed at the Davie shipyard and opportunities are gradually emerging from areas related to medical technology, electronic components, metal products and food processing. In short, the Québec City CMA remains one of the most dynamic areas in Eastern Canada. Despite a less than exceptional year in 2013, it has accumulated growth of 8.7% between 2008 and 2013, which positions it ahead of Toronto (+ 8.1%) and Montréal (+ 6.8%). For 2014, the outlook is also positive since the real GDP is expected to increase by 2% in the Québec City area. Regional economic growth will depend, inter alia, on the impact of the American and European economic recoveries which are being confirmed, and on the development of key industries and the sustained efforts to develop new production and export markets. Crédit:LucAntoineCouturier
    • ECONOMIC REPORTS AND OUTLOOKS Québec City CMA 2013 2014 ECONOMIC GROWTH 7 Real GDP: Profile of the 8 major Canadian CMAs REAL GDP $M VARIATION (%) 2012 2013 2012-2013 2008-2013 Québec 32,694.0 33,095.1 1.2 8.7 Toronto 290,467.8 295,818.5 1.8 8.1 Montréal 160,915.0 163,700.6 1.7 6.8 Vancouver 110,203.1 113,007.9 2.5 10.5 Calgary 107,426.1 111,410.1 3.7 13.9 Edmonton 79,318.2 83,365.5 5.1 22.3 Ottawa 62,676.4 62,762.7 0.1 4.8 Winnipeg 33,505.8 33,880.3 1.1 7.2 Sources: Conference Board of Canada and Québec International Distribution of the real GDP by activity sector in the Québec City CMA, 2013 Primary 3% Manufacturing 6% Construction 7% Production services 51% Consumption services 17% Government services 16% Services 84% Sources: Conference Board of Canada and Québec International Credit:LucAntoineCouturier
    • 8 PURCHASING POWER AVERAGE SALARY According to the Conference Board of Canada, a worker earned an average salary of $40,726 in the Québec City CMA in 2013 ($40,493 in Québec), an annual increase of 2.5% from 2012 (+ 1.6% in Québec). The steadiness of employment, the scarcity of skilled labour in certain areas and the diversification of skilled jobs are factors favourable to the increase of wages in the area. The outlook for positive economic growth for 2014 will also contribute to maintain this progress. PERSONAL DISPOSABLE INCOME The Conference Board of Canada also suggests that personal disposable income (PDI) per capita amounted to $29,034 in Québec City in 2013 ($26,893 in the province of Québec), an increase of 2.8% from 2012 (+ 1.9% in Québec). The area ranked first in Québec, thus beating Montréal ($28,303). For 2014, the PDI per capita will continue to grow in the Québec City CMA due to the increase of employment earnings and the increase in government transfers. INFLATION RATE The inflation rate rose by 1.1% in the Québec City CMA in 2013. The area experienced an increase which was slightly more than that of Québec (+ 0.8%) and Canada (+ 1%). However, the pressure on consumer prices remained well-controlled. In fact, price increases for goods and services, including food, housing and energy, remained modest, a situation that could persist in 2014. RETAIL SALES The improvement of revenues and the low inflation rate reflected an increase in retail sales. In 2013, volume of sales reached $12.6G in the metropolitan area of Québec City, representing an annual increase of 2.5%. The increase in revenues and still-favorable borrowing rates will help support this progress in 2014. BANKRUPTCIES The Québec City CMA counted 1,998 bankruptcies in 2013, an increase of 7% compared with 2012, when there had been 1,868. The seesaw pattern of the evolution of the labour market appeared to have an effect on consumer portfolios since 1,867 people declared personal bankruptcy, i.e. 112 more than in 2012. The downturn in the residential sector and the contraction of the manufacturing industry probably affected part of the 131 companies – 18 more than in 2012 – that filed for bankruptcy last year. Improving the prospects for economic growth and employment, combined with still-favourable interest rates, should maintain the number of bankruptcies below 2,000 for Québec City in 2014. 2Credit:YvesTessier,Tassima
    • 2013 2014 ECONOMIC REPORTS AND OUTLOOKS Québec City CMA 9 POUVOIR D’ACHAT Profile of the purchasing power of the 8 major Canadian CMAs, 2013 PDI PER AVERAGE RETAIL INFLATION CAPITA SALARY SALES RATE $ Variation (%) $ Variation (%) $M Variation (%) % 2013 2008-2013 2013 2008-2013 2013 2008-2013 2013 Québec 29,034 8.5 40,726 6.5 12,650 10.5 0.9 Calgary 42,150 6.8 67,259 9.0 25,408 11.2 1.7 Edmonton 37,400 12.1 60,455 9.0 23,904 15.7 1.2 Ottawa 34,210 12.5 50,848 13.5 17,436 14.9 1.0 Vancouver 32,069 9.1 45,071 8.1 28,921 10.3 0.1 Toronto 31,872 10.9 49,706 8.1 68,889 12.6 1.2 Montréal 27,729 8.5 41,470 9.2 48,131 15.1 0.8 Winnipeg 29,495 8.5 41,925 11.2 10,524 11.9 2.2 Sources: Conference Board of Canada and Québec International Evolution in the number of bankruptcies by type, Québec City CMA 2008 2,700 2,500 2,300 2,100 1,900 1,700 1,500 Number Consumers (l) Companies (r) Number 190 180 170 160 150 140 130 120 110 100 2009 2010 2011 2012 2013 Source: Office of the Superintendent of Bankruptcy Canada Credit:YvesTessier,Tassima
    • 10 3 The Québec City CMA counted 421,900 jobs in 2013, 100 less than in 2012. This pause occurs after six consecutive years of growth that led to the creation of 46,400 jobs between 2006 and 2012. Nevertheless, the need for labour remains sustained in the area since the unemployment rate fell by four-tenths of a point, to 4.7% in 2013. The Québec City area had the lowest unemployment rate in Québec, but also one of the lowest in Canada. Although the number of people employed remained almost unchanged in Québec City between 2012 and 2013, the number of full-time positions has increased by 2,400 last year. The area partly offset the loss of 2,600 part-time jobs. Moreover, the labour market has been favourable to the 25-54 and 55+ age groups. For each of these age groups, the Québec City metropolitan area posted the creation of 2,600 and 6,400 jobs respectively. However, during the same period, there was a decrease of 9,100 jobs among youths aged 15 to 24, hence casting a shadow over this performance. Furthermore, the scarcity of available labour worsened in the 25-54 age group. People in the mid-life population showed an unemploy- ment rate of 3.4% and an employment rate of 86.9% last year. Even though the services sector had been on a roll since 2007, a loss of 3,800 jobs showed a decline in terms of employment. This decline had a considerable impact on the regional assessment as this sector represents approximately 87% of the jobs in the area. Hiring accelerated for the consumer services component, but not enough to offset the decline of jobs in production services and government services. Because of its economic structure increasingly oriented to the knowledge economy, the area suggests an employment increase in 2014 for different sectors including professional, scientific and technical services, financial services and insurance, health, and education. The construction industry quickly made up for its poor performance in 2012 by creating 2,300 jobs in 2013. Although the area enjoys a non-residential sector that remains strong, the outlook remains modest due to the slowndown of the residential sector. For its part, the manufacturing sector accounted for 27,300 jobs in 2013 – 700 more that during the lows of 2012. Despite this gain, the area has returned to levels that prevailed in the late 1990s, while still far behind the peak of 41,900 jobs it had reached in 2006. Therefore, this is a return to square one for Québec City that sees new opportunities appearing on the horizon, particularly in specialized areas. The re-launch of the Davie shipyard has begun. The expansion of businesses related to food processing, medical products, electronic components and metal products is continuing gradually. In addition, the decline in the Canadian dollar and the US economic recovery are favourable to re-launch orders from our manufacturers. Employment opportunities will remain positive for the Québec City CMA in 2014. The Léger survey results on the confidence of entrepreneurs – published in January by Québec International, the Chambre de commerce et d’industrie de Québec, and the Chambre de commerce de Lévis – incidentally revealed that 61% of business leaders in the area planned to hire during the year. In addition, the results for the first quarter showed a gain of 13,500 jobs for the first three months of 2014, registering as the fifth highest in Canada. However, expectations remain modest as the scarcity of available manpower, including qualified workers, will dampen this growth, as the low unemployment rate shows us. LABOUR MARKET
    • 2013 2014 ECONOMIC REPORTS AND OUTLOOKS Québec City CMA 11 LABOURMARKET The employment market Profile of the 8 major Canadian CMAs EMPLOYMENT (‘000) VARIATION (%) UNEMPLOYMENT EMPLOYMENT RATE RATE 2013 2012-2013 2008-2013 Total 25-54 age Total 25-54 age group group Québec 421.9 0.0 7.1 4.7 3.4 65.1 86.9 Toronto 3,121.2 3.8 7.9 8.2 7.1 62.7 80.4 Montréal 2,031.7 2.7 6.0 8.0 6.8 61.7 80.9 Vancouver 1,273.3 -0.1 5.5 6.6 5.5 60.7 79.4 Calgary 774.6 2.9 7.8 4.9 4.1 70.6 84.2 Edmonton 718.0 3.6 11.7 4.8 3.9 69.8 83.9 Ottawa 696.4 -2.2 2.3 6.3 4.8 65.3 84.8 Winnipeg 419.1 0.4 4.5 5.9 4.8 65.2 83.6 Sources: Conference Board of Canada and Québec International Variation in employment by activity sector, Québec City CMA 160 150 140 130 120 110 100 90 80 70 60 2008 2009 2010 2011 2012 2013 +53.6% +19.2% +1% -20.5% -33.5% 2008 index = 100 Production services Consumption services Government services Sustainable goods Non-sustainable goods Construction Note: Based on a mobile 3-year average Sources: Statistics Canada and Québec International
    • 121212 NON-RESIDENTIAL INVESTMENT4 12 In 2013, capital expenditures amounted to $1.2G in the Québec City CMA, reaching a new peak. Moreover, Québec City registered an investment growth of 22.8% compared to 2012, positioning itself as the leader of the 8 major Canadian CMAs. All components contributed to the increase in non-residential investment in the Québec City area last year. The commercial sector was the most active, comprising 76% of sums invested and posting an annual growth of 27%. The integration of retail stores and restaurants to residential projects and offices, as well as the arrival of Target, have contributed to this dynamism. 2014 also looks busy due to construction of the Carrefour Saint-Romuald and projects surrounding the expansion of the Miscéo district. Activity was also buzzing in the institutional sector. Capital expenditures increased by 14%, grouping together 15% of total expenditures in 2013. Major office buildings projects took place in Lebourgneuf, Sainte-Foy and Lévis. Work continued on the multi-functional amphitheatre, the Musée national des beaux-arts du Québec, the airport and the port. Some of this work will continue in 2014, and will be complemented with, for example, the introduction of computer data centers and the expansion of the Centre de congrès et d’expositions de Lévis. Office building projects are also on the drawing boards since the vacancy rate remains low. It was 6.5% in the fourth quarter of 2013. Meanwhile, industrial investment jumped by 7% in 2013 for 9% of the total investment in the region. The modernization and expansion efforts of manufacturers seeking to enhance their competitiveness, combined with the re-launch of the Davie shipyard, have contributed to this performance. Investment intentions remain present for 2014, and some areas attached to the pharmaceutical, electronics, metal products, food processing and the manufacture of transport equipment could stand out. For 2014, non-residential investment should remain above the $1 billion mark. The update of the compilation made by Québec International revealed that 170 investment projects are in progress or have been announced in the metropolitan area and will generate investments of more than $6G. Acting as a barometer, the increase of 1.7% in the value of building permits between 2012 and 2013 also suggests sustained activity on non-residential sites this year.
    • 2013 2014 ECONOMIC REPORTS AND OUTLOOKS Québec City CMA 13 NON-RESIDENTIAL INVESTMENT Annual variation in non-residential investment for the 8 major Canadian CMAs Sources: Statistics Canada and Québec International Edmonton Toronto Calgary Ottawa Vancouver Montréal Québec -10.0 -5.0 -7.1 -2.1 2.8 11.3 11.6 14.7 22.8 0.0 5.0 10.0 15.0 20.0 25.0 Annual variation (%) $6.2G of non-residential investment distributed over 170 projects underway and announced in the Québec City CMA in 2014 Private 49% Distribution of institutional investment Institutional sector 112 projects 4.5 G$ Commercial sector 42 projects 952 M$ Industrial sector 16 projects 673 M$ Public 51% Compilation: Québec International
    • 14 5 The residential assessment of the Québec City CMA was consistent with our expectations in 2013. Construction starts decreased by 27.1% compared to a record year in 2012, for a total of 4,680 new units. For the resale market, the region recorded 6,282 transactions for existing homes, meaning an annual decrease of 13%. The new housing market continued its slowdown for single-family dwellings, showing a decline of 23.6% compared to 2012. Meanwhile, the construction of multiple housing began slowing down, for a decrease of 27.9%. In this regard, the construction of rental housing has remained sustained due to low occupancy, which was at 2% in October 2013. The slowdown came from the condominium market instead, which took a pause to sell unsold new units after the exceptional performances of 2011 and 2012. For the resale market, the decline is observed in all components, including co-ownership (-16%), single-family homes (-12%), and plexes (-9%). However, the decrease in the number of transactions has not curbed the increase in the average price. In 2013, an existing property sold at an average price of $267,254 – a 3.6% increase over 2012. It should be noted that the price had increased by 10% for plexes, compared to 3% for single-family homes and condominiums. Moreover, the increase in new listings and the lengthening of sales closing dates (around 100 days in 2013) could reduce the increase in prices by around 3% in 2014. For 2014, demand for property access will remain sustained in the Québec City area due to population growth, good employment, the arrival of immigrants, rising incomes and still low mortgage rates. According to a Québec International compilation, the metropolitan area currently has a hundred current, and announced, major residential construction projects. However, the addition of new and existing properties for sale in recent years has helped the offer adjust itself. This is why we expect a more sustainable rate of about 4,000 construction starts and 6,500 sales of existing units in Québec City in 2014. HOUSING MARKET
    • 2013 2014 ECONOMIC REPORTS AND OUTLOOKS Québec City CMA HOUSINGMARKET Sources: Canada Mortgage and Housing Corporation (CMHC) and Québec Federation of Real Estate Boards (QFREB) 201320122011 Number Sales Construction starts 2010 7,500 7,000 6,500 6,000 5,500 5,000 4,500 Profile of the housing market, Québec City CMA 15
    • The Québec City CMA accounts for 9.7% of the Québec population. It is the 2nd most important area in Québec after Montréal (48.8%). In 2013, 791,934 people lived in the area. It also showed a growth of 0.9% from 2012 (the same as the province). With this performance that surpasses the most optimistic reference scenario set by the Institut de la statistique du Québec, the area is displaying a cumulative growth of 7.5% between 2008 and 2013, compared to 5.1% in Québec. The number of births remains high in the area just as in the rest of Québec. According to the most recent data, the Québec City area counted 8,412 infants in 2012, maintaining itself above the 8,000 bar for the 5th consecutive year. The high level of household confidence and the improvement of income helps support this performance. In terms of immigration, it can be seen that Québec City has an increased power of attraction due mainly to its sustained economic growth, its need for skilled labour and its quality of life. For the 2012-2013 fiscal year, 3,357 international immigrants chose to settle in Québec City, for an annual increase of 3.1%. With this performance, the area had a positive international migration balance of 3,009 people. However, it should be remem- bered that, although the balance sheet is improving, the region is only attracting 6% of international immigrants arriving in Québec, for a proportion lower than its demographic weight. Regarding interprovincial immigration, 1,597 people from other provinces settled in Québec City during the same period – an increase of 20% over 2011-2012. However, 2,429 people went the opposite way, keeping the area from showing a positive balance, a situation that has been persisting for more than 15 years. The birth boom and the increase in the number of new immigrants are favourable to the increase in the number of inhabitants in the Québec City CMA. The next regional demographic projections of the Institut de statistique du Québec – which should be available next fall – lead us also to believe that the Québec City population will continue to grow over the next 20 years. However, a concern surrounds the ageing of the population. In 2012, the average age was 42 in the area (41 in Québec), one of the highest in the province. This situation has an impact on the working age of the population pool. For the first time in nearly 20 years, the 15-64 age group has not registered any growth in 2013, remaining rather unchanged from 2012. In addition, its demographic weight has continued to decline, going down to 68.4% last year, while until 2008, it had remained equal or higher than 71%. This raises the importance of the migration contribution over the medium term to meet the labour needs of companies wishing to expand or locate in the region. DEMOGRAPHICS 16 6
    • ECONOMIC REPORTS AND OUTLOOKS Québec City CMA 2013 2014 DEMOGRAPHICS 17 Distribution of the population by age group PERCENTAGE OF THE TOTAL POPULATION (%) 2003 2013 2031p 0-14 15.7 14.3 15.3 15-24 13.3 12.5 11.1 25-34 13.6 14.4 10.5 35-44 16.0 12.7 12.8 45-64 28.3 28.8 23.8 65 years + 13.2 17.3 26.4 Note: the year 2031 is based on the strong case scenario from the Institut de statistique du Québec Sources: Institut de la statistique du Québec and Québec International Number of immigrants by source in the Québec City CMA 2008-2009 2009-2010 2010-2011 2011-2012 2012-2013 Number International immigrants Inter-provincial immigrants 3,500 3,000 2,500 2,000 1,500 1,000 Sources: Institut de la statistique du Québec and Québec International
    • In recent years, the Québec City area has improved its tourist offering to business and leisure clients. Several investments related to transpor- tation logistics, holding congresses and major events, modernization of cultural and recreational infrastructure, as well as the expansion of accommodation and catering areas, have contributed to its influence. However, these efforts have not always had an instant effect on performance indicators. In 2013, the tourism activity composite index was 93.9 against 95.8 in 2012, registering as the lowest in the last 7 years. Despite a more modest year in 2013, some tourism components did well. The indicator attached to Québec’s Jean-Lesage International Airport went from 152.3 in 2012 to 159.1 last year. In this regard, 1,475,717 travellers transited through the airport, an increase of 9.9% from 2012. Also, we should also stress the positive performance of the Port of Québec for cruises. In fact, the latter welcomed 164,159 passengers and crew in 2013, an increase of more than 1% from the peak year of 2012. Efforts to enhance arrangements with carriers and the modernization of facilities will contribute to support the activity of these two entities in the future. Other indicators also did well. The shopping index resumed an upward swing and the sites and attractions index remained stable compared to 2012. The high number of tourists in the area, combined with the many large-scale events, probably contributed to this performance. However, attendance scores associated with accommodation and catering declined last year. The still-high value of the Canadian dollar and the persistence of economic uncertainties could be factors dampening certain expenditures. Of course, this did not prevent the hotel occupancy rate to climb from 57.8% in 2012 to 58.2% in 2013, the highest rate observed since the 60.8% peak in 2008. However, part of this improvement was caused by a decrease in available rooms, as more than 400 were crossed off the area room offer. Despite these mixed results, tourism remains an economic engine for the Québec City area. It generates nearly 24,000 direct jobs and its contribution to the Québec GDP amounts to $1G. In addition, ongoing efforts to diversify the tourist offer with various clients should prove an asset to increase the trend towards Québec City and its outskirts. TOURISM 18 7Credit:ClaudelHuot
    • 19 TOURISM 2013 2014 ECONOMIC REPORTS AND OUTLOOKS Québec City CMA Tourism indicators for the Québec City area 2011 2012 2013 Composite index of tourism activity 98.1 95.8 93.9 Hotel occupancy index 100.6 100.9 97.7 Site/attraction use index 86.6 90.6 90.5 Shop visits index 95.2 90.5 92.4 Restaurant occupancy index 99.3 92.6 90.6 Airport use index of Jean-Lesage International Airport 148.8 152.3 159.1 Hotel occupancy rate (%) 57.4 57.8 58.2 Source: Québec City Tourism Credit:ClaudelHuot
    • PRIMARY ECONOMIC INDICATORS OF THE QUÉBEC CITY CMA 2003 2010 2011 2012 2013 2014F Real GDP (millions of $) 26,825.3 31,543.3 32,195.7 32,694.0 33,095.1 33,757.0 Annual change (%) 2.0 2.6 2.1 1.5 1.2 2.0 Real GDP per capita ($) 37,646 41,149 41,445 41,638 41,790 42,313 Annual change (%) 1.4 1.3 0.7 0.5 0.4 1.3 Disposable income per capita ($) 21,945 27,470 27,500 28,250 29,034 29,754 Annual change (%) 4.6 0.6 0.1 2.7 2.8 2.5 Average pay rate ($) 33,278 38,391 38,517 39,722 40,726 41,817 Annual change (%) 5.2 -0.9 0.3 3.1 2.5 2.7 Population 712,568 766,563 776,821 785,191 791,934 799,061 Annual change (%) 0.5 1.3 1.3 1.1 0.9 0.9 Labour market Labour force 388,200 431,100 443,200 444,500 442,800 n/a Annual change (%) 0.2 3.8 2.8 0.3 -0.4 n/a Number of jobs 361,200 410,200 419,700 422,000 421,900 424,400 Annual change (%) -0.4 3.8 2.3 0.5 -0.0 0.6 Job creation -1,600 15,100 9,500 2,300 -100 2,500 Manufacturing 32,700 29,100 31,500 26,600 27,300 n/a Food processing 5,100 6,100 3,900 5,300 4,200 n/a Chemicals 1,600 2,000 2,200 1,900 1,800 n/a Rubber/plastic products n/a n/a 3 100 n/a n/a n/a Metal products 2,700 3,400 3,000 3,300 3,200 n/a Transportation equipment and machinery n/a n/a 4,300 2,500 4,500 n/a Computer, electronic and electrical products 2,600 2,100 2,100 n/a n/a n/a Construction 16,100 19,500 25,700 21,800 24,100 n/a Services 306,800 355,900 358,800 369,800 366,000 n/a Public utilities 122,400 139,500 134,300 148,600 143,600 n/a Financial, insurance and real estate 21,400 33,800 36,400 34,100 34,000 n/a Professional, scientific and technical services 23,100 33,900 34,500 38,700 37,300 n/a Wholesale and retail trade 58,200 63,900 61,200 58,900 59,800 n/a Transportation and storage 14,100 12,700 14,400 15,300 17,200 n/a Accommodation and food services 25,800 28,900 33,500 28,100 27,300 n/a Unemployment rate (%) 6.4 4.9 5.3 5.1 4.7 4.5 Participation rate (%) 67.2 68.6 69.6 69.2 68.4 n/a Employment rate (%) 62.9 65.2 65.9 65.7 65.1 n/a APPENDIX 1 20
    • 2013 2014 ECONOMIC REPORTS AND OUTLOOKS Québec City CMA 21 APPENDIX1 2003 2010 2011 2012 2013 2014F Housing market Housing starts 5,599 6,652 5,445 6,416 4,680 4,000 Annual change (%) 30.8 20.7 -18.1 17.8 -27.1 -14.5 Single dwellings 2,674 1,768 1,349 1,258 970 n/a Multiple housing 2,925 4,884 4,096 5,158 3,710 n/a Resale market 6,811 7,100 7,241 7,219 6,282 6,500 Annual change (%) -11.7 -4.8 2.0 -0.3 -13.0 3.5 Average selling price ($) n/a 235,722 245,470 257,942 267,254 275,272 Annual change (%) n/a 4.1 5.1 3.6 3.0 Vacancy rate (%) n/a 1.0 1.6 2.0 2.5 2.7 Retail sales (millions of $) 8,912.4 12,136.2 12,130.1 12,345.5 12,649.8 12,975.0 Annual change (%) 5.0 5.9 -0.1 1.8 2.5 2.6 Inflation rate (%) 2.6 1.4 3.0 2.2 0.9 1.1 Office buildings Vacancy rate (%) 4.6 5.0 6.1 7.2 6.5 7.0 Gross rent ($/sq. ft.) 16.96 19.95 20.69 21.76 21.70 n/a Number of buildings 170 196 201 204 211 n/a Existing surface (sq. ft.) 14,638,000 16,701,520 16,950,064 17,494,993 18,288,808 n/a Value of building permits (thousands of $) 1,003,443 1,710,086 1,686,712 1,697,117 1,725,444 n/a Commercial (thousands of $) 239,697 306,573 422,525 358,626 533,165 n/a Industrial (thousands of $) 39,640 98,176 93,967 70,680 104,267 n/a Institutional (thousands of $) 63,022 123,756 74,564 104,105 158,357 n/a Residential (thousands of $) 661,084 1,181,581 1,095,656 1,163,706 929,655 n/a Personal bankruptcies n/a 1,956 1,792 1,755 1,867 n/a Corporate bankruptcies n/a 124 126 113 131 n/a Hotel occupancy rate (%) 53.9 56.3 57.4 57.8 58.2 n/a F: forecast n/a: not available Sources: Conference Board of Canada, Statistics Canada, Institut de la statistique du Québec, Canada Mortgage and Housing Corporation (CMHC), Québec Federation of Real Estate Boards (QFREB), Office of the Superintendent of Bankruptcy Canada, Altus Group, Desjardins Group and Québec International.
    • MAJOR PROJECTS UNDERWAY AND PLANNED IN THE QUÉBEC CITY CMA Company name City Type of investment Investment (M$) Port de Québec Québec City Expansion 400.0 Société immobilière Lévis Carrefour Saint-Romuald – 400.0 Maestri Terra commercial complex City of Québec Québec City Construction of a 400.0 multi-functional amphitheatre Cominar Québec City Mixed real estate project 250.0 Québec City Jean-Lesage Québec City Expansion and 225.0 International Airport et modernisation City of Lévis Lévis Construction of a multi-functional 200.0 center – Miscéo district Government of Canada Québec City Upgrading of the Citadel 165.0 Telus Québec City Deployment of OPTIK technology 150.0 and mobile infrastructures Oxford Properties Group Québec City Expansion of the Galeries de la Capitale 150.0 CSST Québec City Expansion of CSST head office 130.0 Capitale Hélicoptère Québec City Construction of a heliport complex 130.0 and purchase of aircrafts Desjardins Group Lévis Construction of an office building 125.0 City of Québec Québec City Construction of a bio-methanization plant 124.5 Government of Canada Québec City Reconstruction of the military armoury 104.0 Commission de la capitale Québec City Construction of the Promenade 100.0 nationale du Québec Samuel-De-Champlain station du Foulon City of Lévis Lévis Phase 1 Innoparc 100.0 Musée national des Québec City Expansion 90.3 beaux-arts du Québec City of Québec Québec City Construction of a police 85.2 center at Parc Victoria Cominar Québec City Construction of an office building – 80.0 Complexe Jules-Dallaire Château Frontenac Québec City Hotel modernization 66.0 City of Lévis Lévis Construction of a multi-functional, 60.0 5,000 capacity amphitheatre City of Lévis Lévis Construction of a science, technology 60.0 and innovation exploration center Ex Machina Québec City Creation of Le Diamant theatre 60.0 Interplex Québec City Construction of a computer data center 60.0 Société immobilière Québec City Expansion of the ministère des 58.0 du Québec Ressources naturelles buildings Valero Lévis Modernization of the refinery’s 51.0 port storage area APPENDIX 2 22
    • 2013 2014 ECONOMIC REPORTS AND OUTLOOKS Québec City CMA 23 APPENDIX2 Company name City Type of investment Investment (M$) SSQ Groupe financier Québec City Construction of an office building 50.0 City of Lévis Lévis Renewal of the Québec-Lévis 50.0 ferry facilities Société immobilière Québec City Construction of a new building 37.1 du Québec for Revenu Québec GSK Québec City Modernization and addition of a 36.0 vaccine production line Immostar Québec City Construction of an office building – 35.0 Place de l’Escarpement (phase 2) Asentri Québec City Construction of a computer data center 34.5 Pomerleau and Kevlar Québec City Construction of a new office tower 30.0 for the federal government at D’Estimauville City of St-Augustin St-Augustin Construction of a new sports complex 30.0 Four Points Sheraton Lévis Expansion of the hotel 30.0 Ubisoft Québec City Expansion 28.0 City of Québec Québec City Construction of a soccer stadium in Beauport 25.0 Héma Québec Québec City Construction of a research center 21.5 Sources: Emploi-Québec and Québec International
    • Primary sector Number of employees Productions horticoles Demers 100-199 Ferme Onésime Pouliot Inc. 50-99 Fraises de l’Île d’Orléans Québec Inc. 50-99 Ferme François Gosselin Inc. 50-99 Entreprises Forestières Serge Bureau Inc. 50-99 Serres Lacoste 50-99 Sablière Drapeau Inc. 50-99 Vaperma 20-49 CSL-Loma 20-49 Junex 20-49 Construction Number of employees Lambert Somec Inc. 200-499 Borea Construction 200-499 Construction Polaris Inc. 200-499 TBC Constructions Inc. 200-499 Construction Gely Inc. 200-499 Armatures EB Inc. 200-499 Honeywell Ltd 200-499 Construction BML - Division de Sintra 200-499 Coffrage LD 200-499 CRT Construction Inc. 200-499 Non-sustainable goods Number of employees Ultramar Ltd 500-999 Frito Lay Canada 500-999 GlaxoSmithKline Biotechnologicals Amérique du Nord 500-999 Exceldor coopérative 500-999 Alex Coulombe Ltd 200-499 Louis Garneau Sports Inc. 200-499 Agropur Coopérative - Division Natrel 200-499 Biscuits Leclerc Ltd 200-499 Sanimax 200-499 Pharmalab 200-499 Sustainable goods Number of employees Groupe Canam Inc. 1 000-1 499 EXFO 500-999 Davie 500-999 ABB Inc. - Division solutions analytiques de pointe 200-499 Olympus N.D.T. Canada 200-499 Multiver Ltd 200-499 Julien 200-499 SBI Fabricant de poêles international Inc. 200-499 Corporation Stéris Canada 200-499 Solaris Québec Inc. 200-499 Services Number of employees Mouvement Desjardins 5 000 et plus Industrielle Alliance 1 500-2 999 SSQ 1 500-2 999 CGI 1 000-1 499 La Capitale 1 000-1 499 Hôtels Jaro 1 000-1 499 Beenox 500-999 Roche Ltd 500-999 Bell Canada 500-999 Ubisoft 200-499 APPENDIX 3 24 LIST OF MAJOR PRIVATE SECTOR EMPLOYERS BY ACTIVITY AREA IN THE QUÉBEC CITY CMA
    • DEMOGRAPHICS Census metropolitan area (CMA) Area formed by one or more neighbouring municipalities located around a major urban centre. To constitute a CMA, the urban centre must have at least 100,000 inhabitants. To constitute a census agglomeration (CA), the urban centre must have at least 10,000 inhabitants. Natural growth Changes in population numbers due to net births/deaths. Net migration The difference between the number of individuals moving into an area and the number leaving in a given year. This concept is independent of nationality. LABOUR MARKET Active (working) population Civilian population aged 15 years old and higher, not living in an institution and or on a reserve, either employed or unemployed. Average pay rate The average annual full-time wage/salary earned by full-time workers (more than 30 hours/week) in a normal working year. Employment rate Number of active workers expressed as a percentage of the total population aged 15 years and older. Inflation rate The loss in purchasing power of money due to general and lasting price increases. Participation rate Active population expressed as a percentage of the total population aged 15 years and older. Replacement index The relation between the number of young people entering the labour market (20 to 29 years of age) and the number of individuals preparing to retire (55 to 64 years old), multiplied by 100. Total number of employees Those employees engaged in the production or non- manufacturing operations of an establishment. The working owners and partners are tabulated separately from employees and are not included in the employee count. Unemployed Individuals who are available to work, have no paid employ- ment and actively looking for work. Unemployment rate Number of unemployed expressed as a percentage of the active population. Workers Individuals between 25 and 64 years of age with employ- ment or business income as their primary income source residing in a given area. ECONOMICS Bankruptcy The state of being or becoming bankrupt. Disposable personal income Personal income less direct personal income taxes, social insurance contributions and other current transfers to public administrations. Gross domestic product (GDP) The total unduplicated value of the goods and services produced in an economic area (such as a region) during a given period, regardless of the ownership (foreign/ domestic) of the production factors. GDP at basic prices corresponds to the GDP calculated at market prices, less tax deductions applicable to goods, plus consumer subsidies. INVESTMENTS AND BUILDING PERMITS Building permits Building permits correspond to those issued by municipa- lities with 10,000 or more inhabitants for the construction of new buildings or the undertaking of improvements, depending on building type (residential, industrial, com- mercial, institutional and governmental). Capital investments Capital investments are capital expenditures related to new construction projects and major improvements to existing buildings, in addition to purchases of new machi- nery and equipment. These expenditures also include in- dividual expenditures on residential construction, but do not include purchases of land, existing buildings or used machinery or equipment (unless imported). Public-sector investments Public-sector investments are capital expenditures made by publicly-ownedcompanies and governments at the federal, provincial and local levels. Provincial public administrations include educational, healthcare and social services institu- tions. Value of building permits The value of building permits corresponds to the value of planned building projects in the non-residential sector, the number of authorized dwelling units and the value of building projects in the residential sector. 25 GLOSSARY
    • ECONOMIC REPORTS AND OUTLOOKS Québec City CMA 2013 2014 GLOSSAIRE 26 HOUSING MARKET Condominium A legal structure under which the ownership of immovable property is divided among various co-owners. Rental housing Residential dwellings or buildings available for rent. Vacancy rate The percentage of apartments and row houses that are unoccupied and available for rent. TOURISM Hotel vacancy rate The relation between the number of occupied hotel rooms and the number of available hotel rooms in a given area. Main abbreviations n/a: not available F: forecast R: revised data $: dollars Q: quarter M: million G: billion
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