Issue 17-147 Gross Domestic Product (GDP) 2016

November 15, 2017, based on November 8, 2017 data

Gross domestic product at market prices

British Columbia’s economy (chained GDP, in 2007 dollars) expanded 3.5% in 2016, registering the strongest growth among provinces and outpacing the national average for the third consecutive year. Ontario (+2.6%), Prince Edward Island (+2.3%) and Manitoba (+2.2%) also saw solid gains during the year. The Canadian economy grew only 1.4%, in part due to contractions in Alberta (‑3.7%) and Saskatchewan (‑0.5%), where GDP shrank for the second consecutive year, as low oil and commodity prices continued to affect business investment in those provinces. Despite large projects in Atlantic Canada, Canadian business investment in new structures and equipment fell by 9.4%, led by declines in Saskatchewan (‑19.5%), Alberta (‑18.4%), Ontario (‑8.9%) and British Columbia (‑7.4%).

In British Columbia, final domestic demand rose 3.2%, a much faster pace than in 2015, when total consumption expenditures by households, businesses, governments and non-profit institutions were up 2.0%. Household consumption expenditures continued to climb, increasing by 3.2% during the year, with consumption of both goods (+4.0%) and services (+2.7%) recording healthy gains. Consumer purchases of durable goods surged above seven per cent for a third consecutive year. Government final consumption expenditures were up 2.5%, while non-profit institutions increased their spending by a more modest 1.4%.

Investment in fixed capital rose by 3.6%. The increase was widespread among sectors with governments (+5.6%) and non-profit institutions (+12.9%) outpacing business investment (+3.2%). Business investment was concentrated in residential structures, where a double-digit increase in spending (+15.0%) more than offset declines in investment in intellectual property products (‑10.4%) and non-residential structures, machinery and equipment (‑7.4%).

The value of British Columbia’s exports of goods and services advanced 1.9% during the year, with sales to other countries (+1.7%) increasing at a slightly slower pace than sales to other provinces (+2.2%). Imports of goods and services rose by 1.0%, with imports from other provinces (+4.1%) offsetting a decline in international imports (‑1.2%). Imports from other provinces had declined (-1.7%) in 2015.

In nominal terms, British Columbia`s economy grew by 4.8%, faster than in the previous year (+4.0%).

Gross domestic product by industry

In the industry account, GDP growth was 3.6% in 2016, with both the goods (+3.4%) and services sector (+3.7%) advancing. The increase was widespread, with almost every industry subsector expanding during the year. The exceptions were management of companies and enterprises, which fell 3.8%, and administrative and support, waste management and remediation services, which remained unchanged from 2015.

The largest increase among industries was in the arts, entertainment and recreation industry (+6.4%), led by an increase in amusement, gambling and recreation (+8.6%).

Among service industries, strong growth was also observed in trade, and transportation and warehousing. Retail trade continued to increase (+5.7%) albeit slightly slower than the 7.6% recorded in 2015. The increase was spread among all eleven subindustries, with the exception of non-store retailers (i.e., electronic shopping and mail-order houses, vending machines, and direct selling establishments), which contracted by 5.2% in the year. Wholesale trade also saw a notable increase in 2016 (+5.3%), with building material and supplies wholesaler-distributors (+11.3%) seeing the largest increase in sales. Transportation and warehousing grew by 5.6% for the year, ranking fourth among all industries.

The manufacturing industry grew by 5.8% in the year, leading the goods-producing sector. Primary metal manufacturing almost doubled in the year (+80.9%), while beverage and tobacco products (+12.9%) and wood products (+5.7%) manufacturing also contributed significantly to overall industry growth.

Data Source: Statistics Canada

Data available on the BC Stats British Columbia Economic Accounts page.