Edmonton (Alta.) - 1987-2000 - Socio-economic forecasts_1996-2001, City of Edmonton (1996-03)

SOCIO im ECONOMIC FORECASTS 1996-20Q1 CITY OF EDMONTON

Fanning end Developmog

LBBRARY

The City of Edatontin

@Manton

-••

PLANNING AND DEVELOPMENT

LIBRARY

Prepared by the City Forecast Committee March, 1996

ARCHIVES

ki'96 -/ DO NOT REMOVE FROM LIBRARY

elfriOnton

PLANNING AND DEVELOPMENT

Members of City Forecast Committee Jong Huang (Chairman) Senior Economist Planning and Development Department _

Michael Kroening Manager, Planning and Evaluation Community &I Family Services Department_

Dana Oikawa Senior Economic Advisor Edmonton Power

Rick Cowburn Director, Pricing and Regulation Edmonton Power

Rick Hersack Research Manager Economic Development Edmonton

Rob Smyth Director, Strategic and Policy Analysis Parks and Recreation Department

Allan Brownlee Supervisor of Forecasting Transportation Department

Don Pilling Fire Protection Engineer Emergency Response Department

Patrick Walters Economist Planning and Development Department

Bev Burke Manager, Personnel Services Personnel Department

Nila Chowdhury Senior Budget Consultant Office of Studies & Budget

Bob Mills Department Controller Public Works Department

Susan Ancel Senior Engineer Public Works Department

Carmen Sparrow Planning Analyst ED TEL

Christina Ionescu Cost and Value Analyst Finance Department

Donna Egglestone Senior Financial Analyst ED TEL

_

_

John Fairweather Sergeant Community and Organizational Support Police Services Department

phone: 496-6068 or For more information contact: Jong Huang, Patrick Walters, phone: 496-6070

presents an obstacle to the re-election hopes of an incumbent president.

INTRODUCTION la This report provides a forecast of major . economic and social indicators for the years 1996 to 2001. The forecast will be used as a reference for the preparation of the 1997-2001 Capital Priorities Plan and the 1997 Operating Budget. Civic departments could use this document for strategic and corporate planning.

In addition, other public agencies, citizens and businesses could use the forecasts for planning purposes. m The City Forecast Committee undertakes monitoring and forecasting activities . throughout the year. A forecast report js prepared in the spring of each year. The report is again reviewed and updated in the fall for . reference by the City Council in their review of

m The forecast assumes that the U.S. economy will slow further to 2.0% in 1997 as it nears its production capacity. The economy will rebound to grow at 2.5% in 1998 and 3.0% annually from 1999 to the end of the forecast period.

CANADA The Canadian economy will grow moderately in response to slower American economic activity, lagging consumer confidence, and continued government fiscal restraint.

departmental budgets.

The Canadian economy grew by 2.2% in 1995, down from 4.6% in 1994. Economic activity in Canada was driven by exports to the U.S..

Domestic demand remained weak as the consumer withdrew from the economy in response to slim job prospects, higher interest rate, and high levels of consumer debt.

PART 1: ECONOMIC FORECAST

UNITED STATES Canada sends 80% of its exports to the US. and thus economic changes in that country will have significant implications for the Canadian economy.

The American economy slowed to 2.1% in 1995, down from 3.5% in 1994. The weakness in 1995 resulted from a decline in consumer spending caused by higher interest rates. The economy is expected to grow at a slower rate of 2.5% in 1996.

RI The forecast does not expect the U.S. economy to enter a recession in 1996 since this is a presidential election year. A weak economy

Prepared by: City Forecast Committee, March 1996

ii

Canadian economic activity is expected to slow further to 2.0% in 1996 as federal and provincial governments continue to cut budgets

1

and retrench employees which will continue to dampen consumer confidence. In 1997, the forecast assumes that there will be a federal election in Canada along with a referendum in Quebec. These two events will result in short term political instability in Canada and cause international money markets to place a higher premium on investing in Canada. Higher short term interest rates, continued fiscal restraint from federal and provincial governments, and a slower growing U.S. economy will combine to reduce aggregate demand. As a result, economic growth in Canada is expected to remain at 2.0% in 1997. a The Canadian economy is expected to rebound to 2.5% and 3.0% in 1998 and 1999 before settling at 3.5% annually for the rest of the forecast period. The growth profile for the Canadian economy will resemble that of the U.S. since the Canadian economy will continue to be dependent on export activity to the U.S..

The economy will receive little support from consumer spending in the short term as Canadians attempt to rebuild their savings that were depleted by declining real wages. In addition, consumers will continue to suffer job insecurity, as federal and provincial governments and the private sectors continue to restructure. Further into the forecast period, declining interest rates and improving job prospects will convince consumers to loosen

low inflation and declining government deficits. Also, Quebec is not expected to have a . -referendum in 1996 which will bring more stability to the Canadian political and financial scenes during the year. However, continued political and financial uncertainty in Canada after 1996 will cause the prime rate to edge up again to 7.5% in 1997.

By 1998, the forecast assumes that political stability is restored to Canada and as a result, the prime rate will decline to 7.0%. Between 1998 and 2001, an improving economy will result in tighter commodity and labor markets, causing inflation to increase. As a result, the prime rate will increase to 7.5% for the rest of the forecast period as the monetary authorities attempt to curb inflation.

Prime Lending Rate 10 8

g 6

11111111111111

4; 4 o.

2 0

93 94 95 96 97 98 99 0 1 Year

their purse strings. a

Money markets reacted negatively to political uncertainty over the Quebec referendum by

placing downward pressure on the Canadian dollar and forced the Bank of Canada to increase short term interest rates to defend the Canadian currency. Thus, the prime rate rose to average 8.7% in 1995 from 6.9% in 1994. The prime rate is expected to decline to 7.0% in 1996 as the Canadian economy continues to suffer from excess capacity and benefit from

Prepared by: City Forecast Committee, March 1996

ALBERTA The Alberta economy will out perform the national economy, with growth concentrated in the goods producing industries. a The provincial economy grew at 2.3% in 1995 down from 4.4% and 6.6% in 1994 and 1993 respectively, as a result of higher interest rate

2

Socio-Economic Forecasts, 1996 2001, City of Edmonta humanitarian reasons. In subsequent years, a gradual increase in world demand is expected to support a steady increase in oil prices.

Setting aside the possible sale of Iraqi oil, the forecast calls for the price of WTI to average $18 in 1996, rising steadily to US$20.50 by 2001.

during the first half of the year and continued provincial government cutbacks. Economic growth, in Alberta, is expected to improve to 2.5% in 1996 and 2.7% in 1997, in response to lower interest rates, stabilizing provincial government expenditures, firming energy prices, and increased investment in the energy and resources sectors. The provincial economy will grow at 3.0% in 1998 and then increase to 3.5% annually between 1999 and the end of the forecast period, as a result of stronger economic activity in North America and continued strong investment in the energy and resources industries.

World Oil Prices (US$/Barrel) 21 • 20 E 19

a 18 017 16 15

MI •1 •• IIIII•1•11111•MMI 171119■7

III•••••••I 1•••••••111 93 94 95 96 97 98 Year

[e

s Frigid temperatures and widespread weatherrelated production and loading disruptions drove world oil prices up this winter. The price for West Texas Intermediate (WTI) rose briefly above US$20 per barrel in both January and February of this year. Nevertheless, current market indicators suggest that this level will not be sustained. A number of factors will push prices back down this year. These factors include weak growth in world demand, production gains in the North Sea, South America and Asia, a halt in the production slide in the former Soviet Union, anticipated production gains in a number of OPEC countries, and the possible approval of a onetime US$4 billion sale of Iraqi oil for

Prepared by: City Forecast Committee, March 1996

99 0

1

In 1995, heavy drilling activity, high gas

storage levels, insufficient pipeline capacity and generally mild weather combined to produce the worst slump in natural gas prices since 1991. Starting last December, the advent of severe winter temperatures served to increase demand, draw down storage levels and push up prices, particularly in the United States. In Alberta, this run-up in price was curtailed by a continued shortage in pipeline capacity, resulting in trapped production capacity and an increase in domestic gas-ongas competition. A series of pipeline expansion projects is expected to provide some relief, with the first of these expected to come onstream early in 1998. Therefore, continued growth in Canadian and US demand should prompt steady increases in gas prices. Thus, the forecast calls for natural gas prices to average less than $1.50 per GJ for the next two years, rising steadily thereafter to $1.90 by 2001.

3

'50..E.CO:.ii4iiik.FFO.i.Wiliq$:;"' -1:9 9

City of Edmonton 3. Syncrude expects to spend $2 billion over the next ten years on oil sands development.

4. Grande Paper Alberta plans to construct a $900 million pulp and paper mill in the Grande Prairie area. r

5. Dow Chemical Canada Plans to spend $200 million to expand its ethylene plant at Fort Saskatchewan in 1996, which could create 400 to 500 construction jobs.

oE

E

Despite efforts at diversification, the provincial economy will continue to rely on energy and forestry developments. Reduction of the machinery and equipment tax, contained in the 1996-97 Alberta Budget, is expected to stimulate more investment in the province. The change of the royalty and tax regimes to a uniform and generic measure for the oil and gas industry, contained in the 1996-97 Federal Budget and announced by the Alberta Government in November, 1995, is expected to stimulate about $25 billion investment in oil sands projects by 2020. These projects, if all proceed, will create about 44,000 new jobs; a majority of the jobs will be in Alberta.

The following are some major resource related projects, announced recently, which will have a significant impact on economic activity in

Alberta and the Edmonton region: 1. Imperial Oil plans to spend $247 million to expand its in-situ operation at Cold Lake over a two year period.

2. Suncor plans to spend $250 million over a three year period on the expansion of its operations at Fort McMurray and $100 million on a new oil sands project.

Prepared by: City Forecast Committee, March 1996

6. Nova and Union Carbide plan to invest $825 million expanding the existing ethylene production complex at Joffre and another $400 million to build a polyethylene plant at Prentiss (near Joffre) over the next four years. These two projects are expected to create 900 construction jobs and 230 permanent jobs.

7. Luscar Limited plans to spend $250 million to develop a coal mine in the Grand Cache area.

8. AT Plastics Inc. plans to spend $120 million to expand its Edmonton polymers plant.

Construction will start this spring and complete in 1998. The expansion will create 50 to 200 construction jobs for builders.

When completed, the plant will need 40 additional full time jobs and increase its

production by 70%. zi Alberta's personal saving rate has dropped almost in half since 1985. As a result, consumer spending will remain weak as individuals attempt to re-build their savings or reduce their debts. The provincial economy will be mainly driven by exports of petrochemicals, manufactured goods, forest products and energy products to the U.S.. The goods producing sectors and the private service producing sectors will experience above

4

Socio- 'conomk Forecasts 1996 average growth. Continued fiscal restraint will cause the government supported service sectors to grow below the provincial average. -

Alberta Savings Rate

EDMONTON The Edmonton region's economic growth will mirror the province's as the region benefits from investments in resource based activity in Northern Alberta.

20 15 2 10

I1I1III1I 85 86 87 88 89 90 91 92 93 94 Year

a Net migration to Alberta from other provinces and countries is expected to average 6,000

a In addition to the investment projects in the energy and forestry sectors, as mentioned in the preceding section, the following construction projects will have significant impact on the Edmonton Economy over the next five years: 1. TransAlta Enterprises will spend $73 million to build a garbage composter plant at Clover Bar over the next three year. This project will generate 400 construction jobs and 50 permanent jobs.

persons in 1996, same as in 1995 but down from 13,400 persons in 1993. In 1997 and after, employment growth is expected to out perform labor force growth, resulting in the provincial unemployment rate being lower than the national average. Therefore, Alberta will experience an increase in net migration. The forecast calls for net migration to increase to 8,000 annually from 1997 to 2001.

2. The provincial government and the City will spend about $70 million in 1996-98 to extend Anthony Henday Drive from Stony Plain Road to Yellowhead Trail and Whitemud Drive from 17th Street to Highway #I4.

3. The move of 3,500 military personnel and their families to CFB Edmonton from Calgary and Chilliwack over the next two years is to be facilitated by $100 million for construction at the Base.

4. The $40 million Francis Winspear Center for Music and the $30 million Edmonton RCMP headquarters are currently under construction.

5. The consolidation of all scheduled passenger flights at the Edmonton International Airport and construction of the terminal in 1997 is expected to increase traffic from 1.9 million passengers to about 2.7 million at the airport.

Prepared by: City Forecast Committee, March 1996

Socio-Economic Forecasts, 1996 2001 City of Edmonton Population

from an estimate of 628,000 in 1995 to 634,000 in 1996, 641,000 in 1997 and 666,000 in 2001.

'Population growth will be modest.

E

2

•

Net migration to the City of Edmonton is , estimated at 1,500 persons in 1996 up from -4,000 in 1995 and -6,000 in 1994. Over the forecast period, the regional and provincial unemployment rates are expected to decline relative to the rest of Canada as labor market conditions improve in the province. In addition, continued fiscal restraint in the rest of Canada will combine with improved Alberta labor market conditions to attract would be job seekers from other provinces to Alberta and the Edmonton region. Net migration to Edmonton is forecast to total 2,000 in 1997 and increase to 2,200 annually for the rest of the forecast period.

Similarly, net migration for the Edmonton Census Metropolitan Area (C.M.A.) is expected to rise from -4,500 persons in 1995 and -6,700 persons in 1994 to 2,500 per year in 1996-97 and 2,700 per year in 1998-2001.

Edmonton Net Migration City and C.M.A.

Population in the Edmonton C.M.A. will rise from 882,000 in 1995 to 891,000 in 1996, 900,000 in 1997 and 934,000 in 2001.

Edmonton Population City and C.M.A.

Labor Market Employment growth should exceed labor force growth as the region benefits from continued growth in the service and manufacturing activity as a result of continued investment in the resource sector. mi Total employment in the Edmonton C.M.A. was estimated at 453,000 persons in 1995, an increase of 14,000 over the 1994 estimate. The forecast calls for employment to grow by 5,000

persons to 458,000 in 1996, as the region adjusts to slower growth in the North American

E

Edmonton's population grew marginally over the past two years as negative net migration offset positive natural increase. However, the expected positive net migration will result in a higher level of population growth over the next five years. Edmonton population will increase .

Prepared by: City Forecast Committee, March 1996

E

economy. By 1997, total employment will average 462,000 persons and this will increase to 486,000 persons by 2001.

Employment growth in the region will track that in the province. Goods producing industries and the private sector service industries will experience above average growth rates whereas the government supported service sector will grow below

6

•

conomic Forecasts 1996

Socio

average. Continued government restraint will act as a drag on the region's overall performance in the short-run. Activity in the goods producing and private service sectors • will be supported by energy and forestry developments. In addition, the transfer of 3,500 military personnel to the Canadian Forces Base in Edmonton will add further stimulus to the Edmonton economy

Employment

▪ •c co • .c

500 480 460 440 420 400

Edmonton C.M.A.

7111111+

380

Inflation

Inflation will remain low in the short term as the economy experiences excess capacity. a Reduced disposable income caused by higher taxes, user charges and continued job losses from public and private sectors restructuring should continue to depress aggregate demand and thus moderate price increases in the shortterm. Current high unemployment rates will continue to restrain wage settlements and add little pressure to cost push inflation. Lack of demand and supply pressures should combine to keep inflation rates low. Edmonton's inflation should average 2.0% in 1996, unchanged from 1995. The rate is expected to increase to 2.5% in 1997.and climb io 3.5% by the end of the forecast period.

93 94 95 96 97 98 99 0 Year

Inflation Rate - CPI Edmonton C.M.A.

El The unemployment rate is expected to fall to 8.5% in 1996 down from 8.9% and 10.4% in ' 1995 and 1994, as employment growth outstrips labor force growth. The forecast expects employment growth to be slightly larger than labor force growth throughout the forecast period. As a result, the unemployment rate should continue to decline to 6.5% by 2001.

Unemployment Rate 12

Edmonton C.M.A

Construction

10 8 11.1 I11) O.

6 4 2

• • II • • II• • IN • II •••

0 93 94 95 96 97 98 99 0 1 Year

Prepared by: City Forecast Committee, March 1996

Construction activity will make a modest recovery as real estate inventories gradually decline. a

Building permit values fell to $371 million in 1995 from $443 million in 1994 and $527 million in 1993. The forecast calls for building permit values to range between $400 and $500

7

million in 1996 and increase to between $500 and $600 million per year over 1998- 2001.

ED

in

Edmonton's housing starts totaled 1,893 units in 1995 down from 3,151 units and 4,235 units in 1994 and 1993, respectively. Housing starts should increase modestly in 1996 to 2,100 units in response to lower interest rates, positive net migration and improved labor market. Housing starts will grow to 2,500 units by 1998 and remain at that level for the rest of the forecast period.

Total housing starts in Edmonton C.M.A. dropped 38% to 3,082 units in 1995 from 5,006 units in 1994. With expected lower interest rates and improved labour market in the region, total housing starts is expected to increase slowly to 3,300 units in 1996, 3,700 units in 1997 and 4,000 units per year after 1999.

7000 6000 5000 4000 3000 2000 1000 0

a Construction activity in Edmonton is restrained by excess supply in both residential and non.residential markets. High levels of housing_ construction in 1994 coupled with weak demand stemming from relatively high interest rates, lagging employment income growth, and low population growth have resulted in a large inventory of unsold houses. Around the midpoint of the forecast, it is expected that lower interest rates, improved job prospects, higher disposable incomes, and lower housing inventory should result in increased construction activity. In addition, the arrival of the military personnel at CFB Edmonton should add to the demand for off-base civilian housing. a In the non-residential market, construction activity was concentrated in the industrial sector, where the average vacancy rate was 6.2% in 1995 down from 8.0% in 1994. This resulted in the value of industrial building permits increasing from $12.2 million in 1994. to $22.1 million in 1995. This activity was driven by strong demand for warehousing space by firms active in Northern Alberta.

Construction activity in the industrial sector should continue in 1996 as the inventory of industrial space remains relatively low. In addition, a significant amount of industrial space is'obsolete and is in need of upgrade. The same applies to institutional sector where the Edmonton Public School Board reports that it requires about $80 million to upgrade 37 aging schools.

Real Estate Market Both apartment and office space vacancy rates will decline slowly.

The apartment vacancy rate averaged 10.2% in October 1995 up from 8.9% and 6.5% in 1994

Prepared by: City Forecast Committee, March 1996

8

E monto and 1993. The increase in the vacancy rate is attributable to such factors as negative net migration, shift to home ownership, double-up of existing renters, and young potential renters remaining at home with their parents. The forecast calls for the vacancy rate to average 9.5% in 1996 and trend downwards to 5.0% by 2001 as Edmonton experiences improved labor market conditions and positive net migration.

g

g g

The downtown office space vacancy rate averaged 17.5% in 1995 roughly the same as the 1994 rate of 17.6% but up from the 1993 rate of 16.4%. The downtown office vacancy rate is expected to average 16.5% in 1996 and trend downwards to 13.5% by 2001.

economic activity may not rebound as expected and job growth could be less.

- If world oil prices fall far below US$18 over the forecast period, the planned investment in the energy sector will be significantly curtailed and provincial government budget revenues will be reduced. As a result, economic activity in Alberta and Edmonton will be slower.

The Canadian forecast assumes that interest rates will fall in 1996 and 1998 and stay relatively very stable over the rest of the forecast period. This assumption could be violated by the following events: 1. fear of higher inflation rates in the U.S.; 2. continued political uncertainty over the future of Quebec; and

3. a higher than forecast federal budget

deficit.

Any or a combination of these events will exert pressure on the Canadian dollar and thus force the Bank of Canada to increase interest rates. Higher than the forecast interest rates will curtail economic activity and result in a lower growth rate.

'There is also an upside risk to the forecast. •

Unexpected increases in provincial revenues may allow the Alberta government more fiscal room to reduce provincial taxes or increase spending or a combination of both. If this scenario materializes, Alberta economic growth and local employment will be higher than the forecast.

g

If the anticipated oil sand and other resourcesrelated projects proceed earlier than expected, economic growth in Alberta and Edmonton over the next five years will be higher than the forecast.

Edmonton Forecast Risks !There is a downside risk to the forecast. g

The forecast assumes that the private sector, locally and provincially, will respond positively to the reduced government spending and lack of tax increases. Failure by the private sector to respond in a positive way to these cuts will result in a lower level of business investment and consumer spending. As a result,

Prepared by: City Forecast Committee, March 1996

9

Socio-Economic Forecasts, 1996 2001, City of Edmonto -

Table 1

Selected Economic Forecasts Forecast

Actual 1993

Indicator

World Oil Prices (U.S. S/Barrel) Alberta Natural Gas Prices ($/G.J

I 1994 I 1995

1996 L1997 I 1998 j 1999

2000 L2001

U.S.A., Canada and Alberta 18.87

17.10

18.40

18.00

18.50

19.00

19.50

20.00

20.50

1.58

1.72

1.25

1.35

1.40

1.60

1.70

1.80

1.90

3.1

3.5

2.1

2.5

2.0

2.5

3.0

3.0

3.0

2.5

3.0

3.0

3.0

3.0

3.5

3.5

3.5

Economic Growth Rate (70) U.S.A. Canada

2.2

4.6

2.2

2.0

2.0

Alberta

6.6

4.4

2.3

2.5

2.7

Prime Lending Rate (/0) Net Migration (Alberta) (000)

5.9

6.9

8.7

7.0

7.5

7.0

7.5

7.5

7.5

13.4

5.8

6.0

6.0

8.0

8.0 _

8.0

8.0

8.0

Edmonton Net Migration - C.M.A.(000)

1.3

(6.7)

(4.5)

2.5

2.5

2.7

2.7

2.7

2.7

- City (000)

2.6

(6.0)_

(4.0)

1.5

2.0

2.2

2.2

2.2

2.2

Population - C.M.A. (000)

879

879

882

891

900

909

917

926

934

627

626

628

. 634

641

647

653

660

666

Employment (C.M.A.)

425

439

453

458

462

468

474

480

486

Unemployment Rate (C.M.A.) ( 1)/0)

11.2

10.4

8.9

8.5

8.3

7.8

7.3

6.8

6.5

Inflation Rate - CPI (C.M.A.) ( 1)/0) Vacancy Rate (City) ( 1)/0)

0.8

1.6

2.0

2.0

2.5

3.0

3.0

3.5

3.5

6.5

8.9

10.2

9.5

8.5

7.5

6.5

6.0

5.0

16.4

17.6

17.5

16.5

15.5

15.0

14.5

14.0

13.5

- Total

4,235

3,151

1,893

2,100

2,300

2,500

2,500

2,500

2,500

- Single Family

2,148

1,690

1,130

1,600

1,700

1,900

1,900

1,900

1,900

- Multi-Family

2,087

1,461

763

500

600

600

600

600

600

6,720

5,006

3,082

3,300

3,700

3,900

4,000

4,000

4,000

- Single Family

4,202

3,225

2,159

2,600

2,900

3,000

3,100

3,100

3,100

- Multi-Family

2,518

1,781

923

700

800

900

900

900

900

400

450

500

500

500

500

500

550

600

600

600

600

- City (000)

Apartment (Oct) Downtown Office (Dec) Housing Starts (Units) City

C.M.A. - Total

Building Permits (City) - Low : ($million)

- High

527

443

371

Sources: 1. 1993-95 actual: Statistics Canada, Bank of Canada, Canada Mortgage and Housing Corporation, Colliers

Macaulay Nicolls Inc., Canadian Petroleum Association, and Edmonton Planning and Development Dept.

2. 1996 - 2001 forecasts: City Forecast Committee, March, 1996.

Notes:1. World oil prices are for West Texas intermediate crude at Chicago in U. S. dollars.

2. Natural gas prices are Alberta average market prices in Canadian dollars 3. Population and net migration figures for 1994 and 1995 are estimates.

Prepared by: City Forecast Committee, March 1996

10

Table 2 Population Forecasts, 1994-2001: City of Edmonton Age Group

1993

1994

1995

1996

1997

1998

1999

2000

2001

Actual 0-4

47,045

45,985

44,669

43,721

43,033

42,937

42,482

42,125

41,830

5-9

44,412

43,843

43,892

44,056

44,205

43,633

43,300

42,544

41,652

10-14

39,730

40,880

41,286

42,092

42,474

42,597

42,639

43,188 .- 43,401

15-19

38,992

38,447

39,295

40,927

42,392

44,122

45,820

46,625

47,478

20-24

55,804

53,311

50,903

48,887

48,152

47,551

47,903

49,309

51,024

25-29

60,367

57,159

55,495

55,522

55,785

55,711

54,533

53,043

51,156

30-34

64,305

63,061

60,966

58,534

56,274

54,032

52,095

51,450

51,577

35-39

58,171

59,259

59,853

61,105

61,200

61,061

60,676

59,305

56,958

40-44

45,399

47,501

49,558

51,879

54,185

56,442

58,095

59,153

60,444

45-49

35,556

36,908

38,875

40,794

42,054

43,574

45,973

48,273

50,585

50 54 -

27,921

28,703

29,242

30,246

32,088

33,922

35,456

37,548

39,434

55-59

24,705

24,594

24,765

25,068

25,535

26,272

27,196

27,845

28,829

60-64

23,954

23,469

22,872

22,455

22,333

22,378

22,422

22,698

22,997

65-69

21,049

21,409

21,711

21,950

21,836

21,655

21,344

20,903

20,542

70-74

16,449

17,474

18,125

18,743

19,098

19,527

19,955

20,298

20,521

75-79

10,952

11,256

11,763

12,583

13,524

14,353

15,277

15,868

16,402

80-84

6,966

7,565

8,183

8,702

9,217

9,666

9,962

10,414

11,111

85+

5,222

5,663

6,151

6,675

7,154

7,685

8,354

9,051

9,665

626,999

626,487

627,604

633,939

640,539

647,118

653,482

659,640

665,606

(6,000)

(4,000)

1,500

2,000

2,200

2,200

2,200

2,200

5,488

5,117

4,835

4,600

4,379

4,164

3,958

3,766

Total Net Migration Natural Increase

Prepared by: Planning and Development Department, March, 1996.

Nenning end Develotnio.4

UBRARY The City of Edmonton

Prepared by: City Forecast Committee, March 1996

11

Table 3 .

Population Forecasts, 1994-2001: Edmonton C.M.A. Age Group

1991

1994

1995

1996

1997

1998

1999

2000

2001

Actual 0-4

68,130

64,183

62,107

60,523

59,898

69,334

58,904

58,631

58,477

5-9

66,847

66,013

65,156

64,798

63,908

63,100

61,687

60,320

58,759

10-14

59,864

63,683

64,346

65,288

65,304

64,835

64,929

64,697

64,356

15-19

58,906

62,077

63,233

64,322

65,571

67,240

68,565

69,661

70,611

20-24

70,421

68,719

67,217

67,343

68,535

69,859

71,625

73,151

74,249

25-29

81,852

71,468

69,464

70,323

70,621

70,616

70,275

69,735

69,890

30-34

86,839

83,369

79,882

75,883

72,272

68,970

66,704

65,985

66,876

35-39

76,600

83,023

83,445

83,879

83,709

82,751

81,037

78,467

74,514

40-44

64,430

69,496

72,004

75,034

77,543

80,222

81,754

82,735

83,179

45-49

47,615

57,222

59,852

62,489

63,476

64,951

67,713

70,521

73,511

50-54

38,067

42,418

43,955

45,784

49,514

52,687

55,353

58,135

60,706

55-59

33,659

34,596

35,203

36,074

37,268

38,863

40,440

42,081

43,848

60-64

30,482

30,811

30,622

30,774

30,850

31,310

31,820

32,538

33,365

65-69

25,506

26,854

27,279

27,607

27,871

27,948

28,006

27,958

28,103

70-74

18,686

22,319

22,948

23,532

23,826

24,307

24,754

25,206

25,498

75-79

13,487

14,792

15,434

16,296

17,468

18,462

19,417

19,988

20,487

80-84

8,385

10,368

11,093

11,832

12,37

12,72

12,938

13,502

14,231

85+

6,490

8,081

8,731

9,331

9,952

10,630

11,494

12,342

13,129

Total

856,266 879,492 881,970 891,110 899,963 908,757 917,315

Net Migration ,

Natural Increase

925,653 933,790

(6,714)

(4,500)

2500

2,500

2,700

2,700

2,700

2,700

7,448

6,978

6,640

6,353

6,094

5,858

5,638

5,437

by: Planning and Development Department, March, 1996.

Prepared by: Note: 1991 data are census counts adjusted for net census undercoverage, partially enumerated Indian reserves and the July 1 reference date.

Prepared by: City Forecast Committee, March 1996

12

..

PART 2: SOCIAL FORECAST CANADA Funding shortfalls will result from reduced Federal Government human services programs.

Federal Government cost-sharing mechanisms with the Provinces will be through the new Canada Health and Social Transfer (CHST).

CHST funding, combining financial transfers (cash and tax credits) for health,' post-secondary education and social services, will be less than is being transferred to the Provinces currently ($2.5 billion less in 1996-97 and $4.5 billion less in 1997-98).

ALBERTA Human services policies, funding and community outcomes will continue to be heavily influenced by redefinition of the role of government by the Province of Alberta and by decreased funding from the Federal Government. g

Staff reductions and lay-offs, in part as a result of provincial downsizing, will continue during the first part of the forecast period.

Unemploythent of highly trained and professional workers may place additional demands on social services.

g

Reduced funding for human (i.e. social, health and education) and other services will cause reduced levels of service and reduced service

access for some populations. These impacts will

I Canada Health and Social Transfer funding to Alberta in 1996-97 will be $239 million less than in 1995-96. The Province will have to decide how to manage this reduction in federal funds.

g

g

A new Employment Insurance Program will replace the Unemployment Insurance Program.

The new program is in part a response to unemployed people taking longer — almost twice as long — to find new jobs (to a large extent due to restructuring of the economy). The new program will provide lower benefits for a shorter period of time.

A national program to fund child care is being negotiated with provincial social service departments. Opportunities may develop for municipal-provincial cost-sharing.

be felt acutely during the earlier portion of the forecast period as budgets are annualized and cuts are continued.

g Impacts of reduced funding on Edmontonians may be softened later in the forecast period, as the debt is reduced by the Province. g

As shown below, a disproportionate number of Albertans in need reside in Edmonton:

Social-Economic Need Factors:_

Edmonton Vs Calgary

16.2% -Single Parent Families: 8.7% -Less than Grade 9 Education: 19.0% -Low Income: -Supports for Independence 20,960 (Welfare) Cases*: 2,214 -Child Welfare Cases**: -Aboriginal Child Welfare Cases: 781

: 13.2% : 4.3% : 17.0% : 13,672 : 1,768 360 :

• for AFSS regions which are larger than the cities.

• * for health authority regions which are larger than the cities.

Prepared by: City Forecast Committee, March 1996

13

g As a result, Edmonton will continue to have a higher proportion of people requiring human services than will Calgary: 0 Disparities between Edmonton and Calgary will continue to be evident in generation of social program funding. For example, current per capita provincial F.C.S.S. funding is $6.771 million for Edmonton and $7.749 million for Calgary; United Way donor generated funding is $8.5 million for Edmonton and $13.5 million for Calgary. The same disparity is believed to exist in private foundation and corporate sector fund generation. g

The City of Edmonton will advocate with the Province and other municipalities to establish needs-based formulas for social and health program funding.

EDMONTON Changing Nature of Employment and Unemployment Growth in jobs during the forecast period will be primarily in the low paying service industry and in part-time employment; these jobs will have limited or no employment benefits. g

g

Growth of jobs in Edmonton, as elsewhere in Cana4, will continue to be in the low paying service industry and in part-time opportunities ; both with few employment benefits. During the forecast period, this could result in inability to obtain adequate medical care or appropriate leisure activities; in the longer term it could result in people not being able to retire with adequate incomes. •

g

More people who are able to retain "good" jobs will also be working from home with high • technology assistance. This use of technology will spill over into other areas such as increased home schooling and greater use of computers and other technology in schools.

Youth Unemployment High youth unemployment will continue. g Youth unemployment (15-24 years age group) traditionally has been fifty percent higher than unemployment for the general population. This trend is expected to continue. g

Increasing tuition fees at post secondary educational institutions will decrease enrollment, put more demand on entry level jobs and make obtaining "good" employment even more difficult.

with wages little more than welfare rates and with lower benefits (it is estimated that 80 hours of work per week at minimum wage is required for a single parent with one child to live at the poverty line).

g

The City of Edmonton Youth Council and youth-serving agencies will have to mobilize support to reduce negative impacts on Edmonton's young people.

Supports for Independence, Employment Insurance and other support programs will emphasize return to the work force supported by training. However, "good" jobs will be in short supply.

Restructuring

Those leaving the Supports for Independence

(welfare) rolls will generally be accepting jobs

g

Prepared by: City Forecast Committee, March 1996 ,

Restructuring, driven by cost-cutting, will yield cost efficiencies (if not greater effectiveness) in the delivery of health and child welfare services.

14

a There will be continued provincial downloading of service responsibilities onto the community.

Families and individuals, women in particular, will shoulder more of the burden for meeting health and social needs. Leisure time will be reduced generally.

a The number of "working poor" will grow during the first half of the forecast period as proposed changes to the Unemployment Insurance Program come into effect and full-time employment and "good" jobs become more difficult to obtain.

a Traditional agencies are expected to experience , increased difficulties recruiting volunteers.

Agencies will be required to develop new sources of volunteers (e.g. organized labour) and new ways to utilize volunteers' strengths.

a Pressures on the Provincial Supports for

a Increasingly, large service systems such as health and education will be competing for donations and corporate dollars which had previously been provided to small social service agencies.

a Smaller agencies will likely have to fine tune

their fund raising to specific target groups. To ensure their viability, many agencies will have

to become more effective marketers of their services. Mergers and loss of some services to the community can be expected.

Independence Program will change as clients receiving training are cut from welfare rolls and accept low paying jobs. a Children living in poverty will continue to be a problem. One-fifth of Edmonton children will live in poor families. a

Increased employment and lower unemployment rates at the end of the forecast period could see the number of food bank users

level off (food bank users doubled between

1991 and 1994). a The proposed provincial Employment Tax Credit for low and middle income families will have its most direct benefit on the working poor with children, if implemented during the forecast period.

Poverty The percentage of low income families in Edmonton will continue to be higher than that for Alberta as a whole (19.3% vs 13.9% in 1991). a Edmonton will continue to be a resource centre for persons-in-need for northern Alberta. a As employment grows and the unemployment rate decreases over time, a lower percentage of Edmonton ians should be in poverty by the end of the forecast period. However, the social and economic impacts upon some specific populations will continue to be particularly negative.

Prepared by: City Forecast Committee, March 1996

Health Services A health care system weakened by cuts and consolidations will continue to put more political pressure for increased funding of hospitals and community health centres. a Cuts to health funding will be annualized and their full impact will be felt by Edmontonians.

Difficulties will be experienced in operating an effective health care system on reduced funding. a Increased need will be experienced by specific populations such as seniors, low income individuals and families and Aboriginal people,

15

61111120011001047.410OMO; all of whom generally have poorer health status and higher health care utilization. Additional funding will be required to aid these populations.

A change in membership of health authorities to the majority being elected, is expected to provide greater responsiveness to citizen concerns and needs.

Social Services Municipal revenue shortfalls for social services will result in City Council and Administration readdressing priorities. g New provincial policies may not permit municipalities to access the Canada Health and Social Transfer, as had been permitted with the previous Canada Assistance Plan. This would result in shortfalls in revenues for municipal social services programs. •

Child Welfare Abuse, neglect and other child welfare issues reflected in numbers of child welfare cases will remain relatively steady or increase slightly over the forecast period.

The Capital Region (Edmonton and St. Albert) Children's Services Authority will be implemented and child welfare related services will devolve to community agencies under contract to the Authority.

B Child welfare cases will continue to increase early in the forecast period. Stronger early intervention programs, focusing on young children, may reduce the number of child welfare cases later in the forecast period.

To

Aboriginal Head Start programs and other early interventions involving young Aboriginal

Municipal social services will no longer be universally available, but rather will be targeted to those most in need. Increasingly social and related services will become more accountable as funding bodies move toward evaluation of programs and strategic, outcome-based funding.

E Increased labour force participation by women will increase demand for the City's child oriented services and programs. Increased child care services will not be possible without cooperation and commitments from all three levels of government.

E Reductions in services as a result of provincial and federal cutbacks will require advocacy and citizens groups to develop stronger social support networks and new ways to deliver services.

children and their families will come on stream during the forecast period. The number of

Aboriginal children in need of protection (presently 45% of child protection cases in the Edmonton Region) will likely decline later in the forecast period.

g

Downsizing of provincial institutions and insufficient support services will see more mentally ill persons treated in the community.

Many will be forced to live in inadequate or marginal inner city housing and create additional pressures on human services.

The current short supply of supportive living and group homes for vulnerable populations (e.g. frail elderly, mentally ill, disabled individuals and abused children) will be

Prepared by: City Forecast Committee, March 1996

16

'Edmonta

Socio-Economic addressed during the forecast period by local groups and provincial agencies. Quality of accommodation and home delivered services will be better assured through standards development and licensing.

m Effective coordination of family violence services through the Edmonton Council Against Family Violence will likely reduce fears of family violence victims.

Seniors Crime and Violence Reductions in crime will continue in almost all kinds of crime ( 36% decline between 1991 and 1994).

However, the reductions will not be as marked. m Demographic aging of the population, efforts by Edmonton Police Service (e.g. community policing), volunteer programs (e.g. Eyes and Ears) and the City's Safer Cities Initiatives, will help prevent crime.

Although those aged 65 and over are increasing in number and as a proportion of the population, services and benefits for seniors will continue to erode, most seriously affecting those at low, income levels. •

g

current Statistics Canada low income cut-offs.

El Misperceptions of high crime levels (70.2% of Edmontonians surveyed in 1995 perceived that crime had increased over the past few years)

will decrease through active work of Edmonton Police Service, crime prevention organizations and service agencies, bringing perception of crime rates into congruence with the reality of decreases in crime.

â–Ş

Some seniors will have greater difficulty remaining independent and caring for themselves'as funding of programs for seniors is reduced and resources are shifted to other high need segments of the population.

g

Increasingly, younger seniors will be healthier and require fewer support services. However, older and at-risk seniors will require more supports to prevent dependency. Families will more frequently be required to support older relatives as government services are reduced.

g

More older and at-risk seniors, including those with dementia, will be required to live in unregulated or partially regulated "supportive" housing environments.

0 As a result of changing family structure due to aging of the population, more older people will be cared for or living with their adult children.

Stresses caused by intensive care giving, without reprieve or relief, may result in increases in elder abuse.

E

Family violence, as reflected in calls to Edmonton Police Service (over 1700 incidents in 1994) and to social agencies, will likely see an increase in reporting during the first part of the forecast period and decline later as enforcement and more severe penalties increasingly act as deterrents.

Prepared by: City Forecast Committee, March 1996

Impacts of decreases in benefits will see the -poor segment of Edmonton's senior population much worse off than is the current 65+ age cohort. Twenty-six percent of seniors (20,000 in year 2000) will have incomes lower than the

17

.00.i):..Economto::Foiteakik11996A:2001Ncity -ofEdiiidiitt) ............

Education Despite the reintroduction offull funding for kindergarten, funding for education will grow at a rate less than inflation. Continuing efficiency will have to be found in the absence of the districts' ability to requisition the tax base.

targeted to those in greatest need will emerge from restructuring. However, these may continue to fall short of needs.

a The full kindergarten program, to be reintroduced in Fall 1996, will better prepare children for school and help teachers identify children with problems.

Funding for post-secondary education will continue to decline into the forecast period.

Revenue shortfalls will be made up primarily by increases in tuition costs to students. a Greater numbers of youth will opt for college or technical institutions, in contrast to universities, as a way of trying to ensure they will have employment upon completing post-secondary education.

Summary a Reduced funding for human services and restructuring will mean a lower level of services overall.

a Increased number of service industry jobs, created by a changing economy, could reduce the number on welfare but increase the number

of working poor. a Some low income and vulnerable groups will continue to have difficulties accessing services, benefiting from improvements in the economy and becoming beneficiaries of government restructuring.

a Eventually, more cost efficient services -

characterized by greater accountability and

Prepared by: City Forecast Committee, March 1996

18