Presentation on theme: "John Rose Chief Economist Financial Services The Economic Impact of the Late Night Economy June 28, 2012 The Economic Impact of the Late Night Economy."— Presentation transcript:
John Rose Chief Economist Financial Services The Economic Impact of the Late Night Economy June 28, 2012 The Economic Impact of the Late Night Economy June 28, 2012
Agenda Recent developments in Edmonton’s Economy– Slowing Growth & Rising Risks –International Context –Canada, Alberta, Edmonton –Energy Prices –City of Edmonton, Job Growth, Employment, CPI and Non- Residential Construction and Labour Costs –The Outlook - Edmonton and the Region The Late Night Economy –What is the late night economy? –The economic impacts –Other benefits
Global Environment An uneven and anaemic recovery is underway –Slow growth in advanced countries solid growth in developing economies –Momentum is slowing building in North America Europe to experience a ‘double dip’ –Europe struggling with debt and deficit reduction Global financial markets remain fragile –Spanish, Italian, Portuguese and other sovereign debt issues –Unresolved US debate on deficits Source: International Monetary Fund
Canada, Alberta & Edmonton Canadian domestic conditions remain good particularly in western provinces. Better US expansion will boost growth. Alberta continues to outperform national average. Accelerates in 2013 2012 will be a very good year for GDP & outstanding employment growth in Edmonton. Edmonton’s growth will slow to more sustainable levels in 2013. Source: IMF, Conference Board, Economic Trends and External Research
Oil Prices West Texas Intermediate Source: US Energy Information Administration
Natural Gas Prices Henry Hub Source: US Energy Information Administration
Job Growth Stalls Jobs lost in 2008 & 2009 have now been recovered. Edmonton’s rate of job growth in 2011 among the fastest of any large municipality. Labour force has been growing which has moderated wage pressures. Recent job losses will delay but not prevent expected labour shortages and wage pressures in the next year. Source: Statistics Canada Edmonton CMA Unemployment Rate
Consumer Inflation is Stabilizing Edmonton’s year over year inflation rate is down to 0.4% from relatively high levels in 2011. As with Alberta, inflation will pick up somewhat from current levels. Forecast is for 2.00% in 2012. Source: Statistics Canada Edmonton CMA CPI Annual Rate of Change
Real Growth in GDP for the City of Edmonton and the CMA The CMA has enjoyed a quicker recovery has manufacturing and non- residential construction activity picks up. Over the medium term the City growth rate converges with that of the region. A somewhat younger demographic profile allows the City and region to grow more rapidly then Canada in the final years of the outlook. Source: Economic Trends and External Research
Risks and Opportunities Risks –Growing discount for Cdn oil leads to slow down in investment –European financial systems ‘locks’ pushing US into recession –Cdn housing market stumbles reducing consumer confidence and spending –Sudden slowdown in emerging markets depresses commodity prices Opportunities – US recovery gains momentum pulling up Cdn exports. – Europe patches over financial issues and returns to faster growth profile boosting global growth – China and other emerging countries succeed in stimulating more rapid growth hiking global commodity prices
What is the late night economy? 235 licensed establishments open after midnight. Represent approximately 23% of all licensed establishments in the City Total estimated customer revenues in 2010 $467 million Total estimated visits in 2010 – 20 million
Estimating the economic impact Based on survey data calculated total revenues for the sector based on average per seat values. Developed a set of multipliers specific to the City of Edmonton. Estimated the direct and indirect impacts by applying City specific multipliers to the sector’s revenue.
Results for 2010 Total impact on economic output $686 million Addition to Gross Domestic Product of the City - $310 million or 0.7% of the City total Wages and Salaries - $215 million Full time equivalent jobs – 5,800 or 1.5% of total employment in the City.
Other key benefits of the sector A major source of entry level positions for students and young people. A support to special events such as the International Jazz Festival Fringe Fest. An important factor in attracting and retaining young and mobile workers. Significant ancillary impacts via patron spending on retail, food, transportation and other sectors
Q & A John Rose Chief Economist Financial Services 4th Floor, Chancery Hall Edmonton, Alberta, T5J 2C3 (780) 496-6070 firstname.lastname@example.org