Decline in exports and housing market dampened B.C.'s economy in 2012

VANCOUVER, Sept. 10, 2013 /CNW/ - According to the BC Check-Up, a report issued jointly by the province's professional accountants, BC experienced a slowdown in economic expansion last year. However, the province's labour market did realize some positive gains in 2012.

The BC Check-Up found that the province's real GDP growth rate declined from 2.6 per cent in 2011, to 1.7 per cent in 2012. "There are several contributing factors behind this lower growth rate," said Richard Rees, FCA, CEO of ICABC. "Our report cited a decline in the value of exports, a slower housing market, and reduced government spending, all of which had negative impacts on our economy's rate of growth. The report also indicated that lower than expected natural gas and mineral prices affected resource company revenues and reduced royalties collected by the provincial government."

While these factors dampened growth in 2012, there were some positive signs for the coming year. "Exports are expected to lead BC out of its late 2012/early 2013 rough patch. Merchandise exports during the first five months of 2013 were 4.2 per cent higher than during the same period in 2012, due primarily to demand growth in the US and China," said Gordon Ruth, FCGA, CEO of CGA-BC. "Continued export growth throughout 2013 should stimulate job creation and consumer spending in BC, both this year and next. RBC is predicting a 1.6 per cent real GDP growth rate in 2013, and 2.7 per cent in 2014."

The BC Check-Up identified several labour market indicators that saw improvement in 2012, notably: 

• BC's job creation rate was 1.7 per cent, an increase of 37,800 jobs over 2011;
  
  
• BC's labour force educational attainment (the percentage of the labour force aged 25 to 64 with post-secondary accreditation) increased by 0.7 percentage points, to reach 66.6 per cent, with the most rapid growth among workers with post-graduate degrees, reflecting BC's growing information and high technology sectors; and
  
  
• A stronger US housing market and the subsequent demand for BC softwood lumber resulted in increased manufacturing employment in the province's forest industry.
  
  

While there were some bright spots, some labour market problems persist. "One of the most worrisome is the high rate of unemployed young workers. The youth unemployment rate stayed above 13 per cent for the fourth year in a row," said Vinetta Peek, CMA (Hon.), CMA, President and CEO of CMABC. "In addition, BC's business labour productivity, a key economic indicator, declined by 1.6 per cent, and the value of exports per worker declined by 5 per cent in 2012. However, it is important to note that B.C. was not the only province demonstrating lacklustre performance, and none of the comparison jurisdictions in the report had stellar economic results last year."

The report also found that BC's consumer debt per capita rose by 2.9 per cent; however, this was well below the national average growth rate of 4.2 per cent for this indicator.

For additional discussion of BC's economic performance, please consult the BC Check-Up report online at: www.bccpa.ca. An in-depth report on prospects for youth employment and an update on BC's major infrastructure projects are also available.

BC's professional accounting bodies-the Institute of Chartered Accountants of BC (ICABC), the Certified General Accountant Association of BC (CGA-BC), and the Certified Management Accountants Society of BC (CMABC)-have signed a merger agreement and are working together to establish the Chartered Professional Accountants of BC (CPABC). When the merger is complete, CPABC will boast 34,000 members and students. Currently, accounting bodies representing over 90 per cent of Canada's professional accountants in every jurisdiction are committed to unification or have already merged under the CPA banner. For more information, please visit www.bccpa.ca.

ICABC, CGA-BC, and CMABC protect the public interest through rigorous educational and certification programs to uphold the highest professional standards and ethics. The ICABC represents over 11,000 members and just over 1,800 CA students; CMABC represents almost 5,000 members and 1,000 CMA students and candidates; and CGA-BC represents almost 11,000 CGAs and nearly 5,000 CGA students.

SOURCE: Certified General Accountants Association of British Columbia

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