After going through a lean period, the Saguenay-Lac-Saint-Jean should see slight improvement in fiscal years 2016 and 2017, marked by a recovery in the manufacturing and forestry. The regional economy will be pulled up by the combined effect of a recovery in US growth and a weaker Canadian dollar. However, the region’s growth will remain lower than in all of Quebec.
According to the latest bulletin issued by the Desjardins Economic Studies Service for the Saguenay-Lac-Saint-Jean from various government and private sources, the region will experience an increase in its gross domestic product (all goods and services produced ) 2.4% this year and 3.5% in 2017, from $ 10.9 billion to $ 11.3 billion.
According to Chantal Routhier, economist at Desjardins, these data are still lower than what the province will experience with projected increases of 3% and 4% next year.
“When performing profiles, is always compared with the last year. We can see that in 2016 the economy will improve due to the weak dollar and the recovery in the US economy, also because of the price of oil remains low enough to give a hand businesses in regions, contributing to lower their transport costs. The fact remains that when two major sectors (forest and aluminum) are in difficulty, it is difficult to pick the same growth as the province, “said Ms. Routhier.
Economic analysis from the perspective of employment predicts that between 1000 and 2000 more people will occupy a job in the next two years to $ 130,000 at the end of 2017, compared to 127,000 in 2014, which is the low point with an unemployment rate that bordered on 10%. This rate should fall to 8.4% in 2017. The study shows that in 2015, average weekly earnings stood at $ 814.80, equivalent to $ 42,369 annually, an increase of 1.5% compared to last year. In Quebec, the average pay is 43 $ 170.
The data concerning the new construction industry show that employment growth will not be attributable to this sector since a surplus of housing is always seen with a vacancy rate of 6.9%. The result for the next two years in starts broadly stable around 670 new units. Bad news for current owners, sales of existing homes continue to stagnate around 1780 transactions, which will create a downward pressure on selling prices. Since 2013, the average sales price increased from $ 174,982 to $ 165,784 this year, according to forecasts. In Quebec, the average selling price of a home is $ 279,432.
Construction contractors should further leverage the investment in residential renovation, which grew 6.5% in the Saguenay and 4.4% in the Lac-Saint-Jean to stand at $ 347.9 million in 2014, increase due to the entry into force of the tax credits for the renovation and ÉcoRénov LogiRénov.
Chantal Routhier Economist believes that the region will benefit from some signals that were not seen it two years ago, particularly in the forestry sector.
According to her, the forest industry and the pulp and paper continues to be under pressure due to declining demand in several types of paper supply challenges and timber certification. By cons, favorable factors on the horizon as the recovery in residential construction in our southern neighbors and the production of secondary and tertiary processing of species in the boreal forest. “There are working groups that are set up to try to find solutions (following the economic summit). The government has set up working groups to analyze the cost of the fiber. ”
Among the investment projects that should provide short term results are beginning the construction of the power line Chamouchouane-Bout-de-l’Ile from La Doré for $ 1.4 billion and the pursuit of construction of greenhouses Tundra estimated at $ 100 million. Ms. Routhier was not able to estimate how many jobs would be created with the first project of Hydro-Québec will cover a tiny part of the regional territory unless it is certain that the area is a place anchor for the start of the project, will provide significant benefits.
As for the impact of the Serres Tundra project, she prefers to keep a reserve.
In the food sector, the development and production of wild blueberries, development of branding “Boreal” to stimulate regional purchase and agroforestry project Jardins 02 to maximize the exploitation of non-timber forest products that can be beneficial to the economy of the region.
In the longer term, the realization of mineral projects Arianne Phosphate cost of $ 1.2 billion and BlackRock Metals in Chibougamau, the completion of Phases 2 and 3 of the AP-60 aluminum Jonquière Complex and the expansion of the Alma aluminum continue to inspire hope. In the case of the aluminum industry, Desjardins anticipates that the rationalization strategies will continue in the example of what was done with the consolidation of five factories in the area into one administrative entity to better compete with aluminum China and the Middle East.