Instead, it was that so many people continued to underestimate the ability of Canadians to react and adapt to fast-changing or unexpected circumstances.
      “The theme that really stands out is the adaptability of Canadians faced with rapid changes in their economy, it concludes. The most dramatic example of this was the increased migration of people to oil-rich Alberta during the past year,” the study said.
      Going back several years, the economy has been hit with a number of shocks which in the past could well have triggered a slowdown or even recession. Instead, growth has been remarkably stable since 2003, said the Canadian Economic Observer.
       Real gross domestic product expanded 2.7%, only marginally less than the 2.9% gain in 2005, despite a mid-year slowdown. This rate of growth was exactly the same as the average annual gain since 2003.
       The study said the mildness of the slowdown in growth was even more surprising in light of concerns and perceived threats expressed about the economy, including the slump in the automobile and housing markets.
       That the perceived threats to growth did not derail the economy is not new. Just in the past decade, the economy has survived shocks ranging from the Long-Term Capital Management collapse to the Asian and Russian financial crisis in the late 1990s, the review noted.
       The economy also survived the bursting of the high-tech bubble (which triggered the worst bear market for stocks since the Great Depression); the 9/11 terrorist attacks and persistent turmoil in the Middle East; and the jump in the exchange rate and commodity prices.

The resource boom
       The current boom in commodity prices is now entering its fifth year, said the Canadian Economic Observer. Initially, it was sparked by a surge in the energy sector. Metals took the lead in pushing up prices to record levels last year.
       So-called “blue-collar” metals such as copper, nickel, zinc and iron ore spearheaded the advance, overshadowing their more illustrious precious metal cousins, such as silver and gold. This reflects higher demand in the rapidly expanding industrial base of developing countries, notably China.
       One measure of the strength of mining was that it was the only industry that increased employment in every province last year.

Alberta in the limelight
       The development of the oil sands in northern Alberta remained the dominant trend in the energy sector, reshaping Canada’s economic geography.
        Firms continued to pour money into these investments, tripling from C$5.2 billion when the current surge in oil prices began in 2003 to a planned C$16.1 billion in 2007.
        The economic impact of the development of the oil sands rippled across Alberta, which had a litany of record-setting performances.
        They include fastest increase ever in retail sales (+16.2%), biggest hike in building permits and in non-residential construction ($3.6 billion and $1.1 billion respectively), the lowest unemployment rate (3.4%) and largest net inter-provincial migration on record.
        The number of unemployed in Alberta (66,800), was the lowest in absolute terms since 1981, despite population growth of nearly one million (+47%) in the past quarter century. Its 4.8% increase in employment was the most of any province in nearly a decade.
        Alberta by itself accounted for the faster gain in employment and retail sales in Canada than in the US. In fact, without Alberta, growth in the rest of Canada lagged slightly behind the US on both accounts.

Great trek westward
        Alberta proved to be an increasingly attractive destination for people from all provinces, said the Canadian Economic Observer. It received a net inflow of 57,105 people from other provinces, the largest inter-provincial movement of people to one province on record back to 1972.
        The trek west accelerated sharply over the last two years, as word of the Alberta boom spread.
        After an average net inflow of just 11,000 people in 2003 and 2004, inter-provincial migration accelerated to 34,423 in 2005 before its record-setting performance last year. In the last decade, the net inflow of 285,620 inter-provincial migrants was the equivalent of 10% of Alberta’s overall population in 1996, and nearly half of its growth of 600,600 people.

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