Atlantic Canada’s economy will expand 1.6% in 2023, down from 2.4% in 2022, according to APEC’s annual Atlantic Economic Outlook. Atlantic Canada is set to outpace Canada’s forecasted Gross Domestic Product (GDP) increase of 0.5% next year due to sustained in-migration. Newfoundland and Labrador will experience an uptick in growth due to greater oil production and work on the West White Rose project.
High inflation and interest rates are weighing heavily on our outlook for growth next year. The housing market is expected to weaken due to elevated mortgage rates. Retail sales volumes will be largely unchanged as consumers cut back some spending with inflation remaining above 3% next year.
The softening economy will temporarily ease some of the pressures in our labour market. However, labour shortages will continue to be a prominent issue over the medium- to long-term due to an aging workforce.