October 25, 2023

Mixed signals: Alberta economy strong but uncertainty colours future growth expectations

As we get in to the final quarter of 2023, Alberta’s economy is sending some mixed signals. Many indicators point to a strong provincial economy including good labour market conditions, positive business activity, and wage growth, but challenges of affordability, slowing national growth, and declining consumer confidence weigh on future growth expectations.

Mixed Signal #1: Wages outpace inflation, but higher prices still ravage Albertans’ pocketbooks. Wages are once again growing in Alberta, outpacing inflation, and consumer spending is still strong, but the reality is that Albertans are still really struggling with the cost of living. While inflation is moderating, prices for basic things like food and rent continue to cut into affordability, and debt becomes even more challenging to manage.

Mixed Signal #2: Alberta’s labour market is in good condition, but recent jobs declines raise questions. While Canada’s labour market has cooled, Alberta’s jobs market remains relatively strong. Job vacancies have decreased while unemployment has remained steady. However, a steep jobs decline in September was a shock. Time will tell if this is an ominous sign of a slowdown, or simply a blip.

Mixed Signal #3: Provincial business activity is positive, driven by historic population growth, but national expectations cool. Canada’s economy has stalled, and growth is expected to remain low. This contrasts with business activity in Alberta, where conditions have improved. However, Alberta is not immune to global weakness or interest rates, and forecasts for provincial growth look uncertain.

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Report Highlights:

Wages > Inflation: Marking what is an all too rare event, wages in the province not only grew faster than inflation but also faster than the national average, reaching 5.7% as of the most recent data. Though there are multiple factors at play, one drag on wages in 2023 has been the earnings of women, which were previously rising more slowly than that of men, but have now caught up.

(Un)affordability: While headline inflation has been cooling, the reality is that many goods and services are not getting cheaper, and Albertans are no doubt still facing affordability challenges, especially for things like food and rent. Albertans have responded by delaying large purchases or switching to less expensive options.

Jobs Shock: September’s labour force survey sent shockwaves through the provincial labour market, which shed over 35,000 jobs. This was by far the largest drop in jobs since COVID and a departure from how the economy has been performing to date. Time will tell if this was simply a one-month blip or a sign of a provincial slowdown. However, overall, the labour market is still strong as job vacancies decline and unemployment remains stable.

A Chilly Outlook: While Canada’s economy started the year in a very strong place, GDP declined in the second quarter and has remained at a standstill since. What’s more is, stripping away the effect of population growth, the Canadian economy has been in decline since the fourth quarter of last year and this weakness is set to continue. Globally, the outlook is just as chilly, with growth expected to be very weak.

Upbeat in Alberta: In contrast to the chilly expectations for the national economy, Alberta business conditions appear to be warmer. Real-time surveys suggest that business conditions have improved, particularly in Calgary. With the highest level of in-migration (both from other provinces and countries) Alberta has seen in decades, population growth remains a key driver of increased activity in the province.

If you would like to use this report in a publication, please use the following citation.

Business Council of Alberta. Fall 2023.
Alberta Snapshot: A Quarterly Economic Update for Alberta.


We know there is so much economic data and information out there, and that you want a way to see it all in a snapshot with a view looking forward and not just back. That’s why we created the Alberta Snapshot, a quarterly executive summary that helps you keep the pulse on what is happening in Alberta’s economy—the good, bad, and urgent.

We use a wide and diverse range of indicators including data on jobs, consumer spending and debt, business openings and closings, population growth, economic forecasts, and more to assess and synthesize economic activity, business conditions, and social well-being in a way that is meaningful to Albertans and Alberta businesses.

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