Provincial and territorial economic accounts

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Real gross domestic product (GDP) grew in five provinces led by Saskatchewan with growth of 4.4%. GDP in Yukon and Nunavut also advanced. Declining export demand contributed to lower GDP in Newfoundland and Labrador, Ontario, Alberta, British Columbia and Northwest Territories. Nationally, GDP rose 0.5% in 2008 following a 2.7% increase in 2007.

Nationally, economic growth was sluggish during the first half of the year, but contracted during the last five months as foreign demand and commodity prices faltered amid turmoil in global financial markets. Goods production fell 2.8% in 2008, the first decline since 2001, while services production increased 2.1%.

Saskatchewan led the provinces with growth of 4.4%. Strong resource prices and increased investment were major contributors, as most sectors of the province's economy advanced. GDP grew in five provinces and two territories, with Nova Scotia, Saskatchewan and Yukon growing faster in 2008 than in 2007. New Brunswick's GDP remained unchanged from 2007.

Atlantic provinces

GDP increased in two of the four Atlantic provinces, Nova Scotia and Prince Edward Island.

In Nova Scotia, GDP advanced 2.0% following a 1.7% increase in 2007. Personal spending and government expenditures picked up from 2007, offsetting a decline in business investment. Natural gas extraction rose, while forestry production fell.

In Prince Edward Island, GDP grew by 0.9% after a 2.4% increase in 2007. A lower potato crop contributed to a decline in exports. Transportation equipment manufacturing partially offset the export decline. Personal consumption advanced as labour income grew moderately.

The GDP of Newfoundland and Labrador fell 0.1% after leading all provinces in 2007 with a 9.1% increase. The decline was due mostly to a sharp drop in oil extraction, which led to a drop in exports. Capital expenditures by businesses, with the exception of residential construction, fell with the completion of several engineering projects in 2007. Manufacturing activity in the province advanced, propelled by increases in food processing production.

In New Brunswick, GDP did not grow in 2008, following a 1.7% increase in 2007. Labour income continued to grow, aiding personal expenditure. Corporate profits fell 14% (in nominal terms) as weakened foreign demand hit exports, particularly forestry, including paper and wood products.

Central Canada

In Quebec, GDP rose 1.0% after a 2.6% increase in 2007. Quebec's economy felt the pinch of weakened export demand for forestry, furniture and textile products. Production in manufacturing fell 2.6%. Production in aerospace industries tempered this decline.

Business and government investment in engineering construction remained strong in Quebec, overcoming a moderate decline in residential construction. Labour income growth decelerated somewhat from 2007 and slowed personal expenditure growth, particularly for non-durable goods and services.

Quebec's economy also benefited from strength in the public and financial sectors.

GDP in Ontario fell 0.4% in 2008 after a 2.3% increase in 2007. Ontario's growth has generally been below the national growth rate since 2003.

Automobile and auto parts production declined more than 20%, while production of wood products dropped sharply. Weakened export demand contributed to a decline in 16 of 21 major manufacturing industry groups in Ontario.

Construction activity fell back slightly as several engineering projects neared completion and residential investment declined 2.5%. Personal expenditure grew but at a slower pace than in 2007, in tandem with a deceleration in labour income.

The West

Saskatchewan's growth rate of 4.4% led the provinces and surpassed its 2.5% increase in 2007. Favourable weather conditions aided crop production and boosted farm incomes. Potash and uranium mining both dropped modestly in volume terms, but strong prices pushed corporate profits up 58%.

Strong labour income spurred personal expenditures, particularly on durables. Businesses increased their capital expenditures by 10%, due to a turnaround in business investment in non-residential structures, combined with homebuilding.

In Manitoba, the economy grew by 2.4% after a 3.3% increase in 2007. Construction investment advanced sharply as work continued on major engineering projects throughout the province. Labour income strength had a positive impact on personal expenditure. Reduced exports of manufactured products led to an overall drop in exports. A good wheat and canola crop led to increases in farm income.

In Alberta, the 0.2% decline in real GDP followed a 3.1% increase in 2007. Business investment, particularly on residential structures, dropped. Corporate profits remained strong, rising 28%, helped by high oil prices in the first part of year.

Robust labour income and slowing personal expenditures growth contributed to an increase in personal savings. Sales of durable goods, such as autos, edged up 0.4% after double-digit increases in 2005, 2006, and 2007.

Manufacturing activity dropped slightly, as falling export demand curtailed production of wood, petroleum and petro-chemical products.

In British Columbia, GDP fell 0.3%, its first decline since 1982. This followed a 3.0% increase in 2007.

British Columbia's forestry products were hit by falling export demand. Logging production fell 18%, while wood products manufacturing declined 21%. Personal spending decelerated sharply as spending on durables dropped 0.4%.

Preparations for the 2010 Olympics and engineering construction contributed to moderate investment growth. Residential investment fell for the first time since 1999.

The territories

Nunavut's economy grew 5.5% after a 9.0% increase in 2007. Construction continued at the Meadowbank mine site, although the closure of the Jericho diamond mine contributed to a sharp drop in exports.

Yukon's GDP grew by 5.2% after a 3.6% increase in 2007 and following steady growth since 2004. Increased mining activity led to a 23% increase in exports, while corporate profits grew by 84%. Growth in labour income contributed to personal expenditure, notably on durables.

In the Northwest Territories, GDP fell by 6.5% following an 11.5% increase in 2007. World demand waned and exports fell 11% as diamond mining output fell sharply. Business investment declined with the completion of the Snap Lake mine site. Personal expenditure edged up as labour income growth decelerated from 2007.

Products, services and contact information

Detailed analysis and tables

All of Statistics Canada's information and data on the System of National Economic Accounts are available through the National economic accounts web module, accessible from the home page of our website.

More detailed analysis on today's releases from the national accounts, including additional charts and tables, is now available in the 2008 preliminary estimates issue of Provincial and Territorial Economic Accounts Review, Vol. 5, no. 1 (13-016-XWE, free), from the Publications module of our website.

Provincial and territorial economic accounts, 2008 preliminary estimates

Available on CANSIM: tables 384-0001, 384-0002, 384-0004 to 384-0013 and 384-0036.

Definitions, data sources and methods: survey numbers, including related surveys, 1303, 1401, 1402 and 1902.

With this release preliminary estimates have been made for 2008 without revisions to previous years. The provincial and territorial economic accounts include estimates of the income and the expenditure based GDP, real GDP, contributions to percent change in real GDP, implicit price indexes, sources and disposition of personal income and government detail tables.

The government detail tables have not been updated with this release, their 2007 estimates will be included in the fall release. Summaries by sub-sector of government (federal, provincial, local, Canada Pension Plan and Quebec Pension Plan) are provided in tables 6 to 10. Revenue side details are presented in tables 11 to 13. Table 11 disaggregates direct taxes, social insurance contributions and transfers paid by persons to government. Table 12 presents the components of taxes on production and products, while Table 13 lists the sources of government investment income. On the expenditure side, the major transfers to persons are presented in Table 14 while subsidies and capital transfers, to both the personal and business sectors, can be found in Table 15. Finally, Table 16 lists the most important current transfers between levels of governments.

The accounts can also be obtained in the 2008 preliminary estimates issue of Provincial and Territorial Economic Accounts: Data Tables, Vol. 2, no. 1 (13-018-XWE, free), from the Publications module of our website.

For more information, or to enquire about the concepts, methods or data quality of this release, contact the information officer (613-951-3640; iead-info-dcrd@statcan.gc.ca), Income and Expenditure Accounts Division.

Provincial gross domestic product by industry

Available on CANSIM: tables 379-0025 and 379-0026.

To purchase data on provincial gross domestic product by industry at basic prices, contact Client Services (toll-free 1-800-887-4623; iad-info-dci@statcan.gc.ca), Industry Accounts Division.

For more information, or to enquire about the concepts, methods or data quality of this release, contact Bruce Cooke (613-951-9061; cookeb@statcan.gc.ca), Industry Accounts Division.