Economic results

In 2012, the Alberta economy grew strongly by 3.9%. Alberta has led all provinces in economic growth over the past 20 years, with an average annual GDP growth of 3.6% per year. Private sector forecasts suggest that Alberta will be one of the three top provinces in economic growth in 2013 and is poised to lead the country in 2014. In 2012, Alberta’s GDP per capita was $78,100, the highest level of any province or state in North America.

Economic fast facts

Even though the recent economic downturn affected Alberta more than most other provinces, Alberta has recovered strongly and leads the nation in employment, exports, and investment:

  • Between 2002 and 2012, Alberta’s exports of goods and services rose 84%, reaching $104 billion in 2012. A growing number of those exports are manufactured products and services. Although the global recession and the U.S. housing crisis had a profound impact on exports of manufactured goods, they still rose 41% between 2002 and 2012.
  • Alberta has had a rapidly growing manufacturing base. Between 2002 and 2012, manufacturing shipments grew by more than 60% to $73 billion.
  • More than 470,000 new jobs were created between 2002 and 2012.
  • Alberta’s average unemployment rate in 2012 was the third lowest in Canada at 4.6%.
  • In 2012, investment per capita was $25,348 in Alberta, more than double the Canadian average of $11,240 per capita.
  • Alberta is in the midst of another period of strong economic growth, expanding by 3.9% in 2012, the highest provincial growth rate. Alberta also leads all provinces in economic growth during the past 20 years, with an average annual GDP growth of 3.6% per year, between 1992 and 2012.
  • Between 2002 and 2012, the industries that recorded the highest economic growth are oil sands, agriculture, oil and gas services, construction, machinery, fabricated metals, retail and wholesale trade, financial services, information services, and professional, scientific and technical services.

Structure of the Alberta economy

Alberta has capitalized on its strengths in agriculture, energy, forestry and industrial products to develop a dynamic and diverse economy.

Alberta is rapidly becoming Canada’s industrial giant, with northern Alberta becoming the centre of activity.

With approximately $14 billion per year of existing activity, Alberta is also one of Canada’s major metal manufacturing centres, behind only Ontario and Quebec. Thanks to a strong demand from Alberta’s energy sector – and the oilsands development just north of the Alberta Energy Corridor – there are numerous opportunities for manufacturing companies located within our region.

Alberta consistently has the highest investment per capita among provinces. In 2008, Alberta investment per capita was $24,262, which is more than twice the national average. A total of $87 billion was invested in 2008, more than doubling the 2002 level.

  • Alberta’s personal tax rates are among the lowest in Canada.
  • Alberta is the only province without a provincial sales tax and has the lowest gasoline taxes in the country.
  • A two-income family of four earning $75,000 pays about $1,400 less in total provincial taxes, including health care premiums, sales and other excise taxes, in Alberta than in Ontario and almost $1,800 less than in British Columbia.
  • Alberta’s minimum wage is $8.80 per hour as of June 2010.

The major, traditional industries in Alberta are

  • oil and gas/Oilsands activity accounts for more than two-thirds of investment in Alberta. In fact, more than $100 billion in oilsands investment is projected to generate more than $1 trillion worth of economic activity.[/slider]
  • petrochemicals
  • agricultural services
  • food and beverage processing
  • tourism
  • industrial machinery and equipment.

Miller Western

Another significant industry is forestry, and two major forestry companies are located within the Alberta Energy Corridor: Millar Western Forest Products Ltd. and Alberta-Pacific Forest Industries Inc. (Al-Pac). Shipments of Alberta forest products reached $3.4 billion in 2009, and exports were $1.8 billion; these shipments included both the lumber produced by Millar Western and the pulp produced by Al-Pac. Alberta covers more than 66 million hectares of land, 58 per cent of which – 38 million hectares – is forested.

The emerging industries within Alberta are

  • nanotechnology
  • biotechnology and pharmaceuticals
  • software development
  • electronics and microelectronics.

Competitive corporate taxes

Alberta has one of the most competitive tax environments in North America. It is the only province that does not have a provincial retail sales tax and there are no provincial capital or payroll taxes, which are common in many other provinces and U.S. states.

The combined federal/provincial corporate income tax rate is 25% for general businesses and 14% for small businesses and a competitive corporate tax rate is in place for manufacturers.

Provincial Corporate Income Tax Rates (%)
Province General Mfg & Processing Small Business
Alberta 10.0 10.0 3.0
British Columbia 10.0 10.0 2.5
New Brunswick 10.0 10.0 4.5
Quebec 11.9 11.9 8.0
Manitoba 12.0 12.0 0.0
Saskatchewan 12.0 10.0 2.0
Ontario 11.5 10.0 4.5
Newfoundland & Labrador 14.0 5.0 4.0
Prince Edward Island 16.0 16.0 1.0
Nova Scotia 16.0 16.0 3.5
Federal 15.0 15.0 11.0
State Corporate Income Tax Rates (%)
State General Mfg & Processing Small Business
Oregon 7.6 7.6 6.6
California 8.84 8.84 8.84
North Dakota 5.15 5.15 4.9
Montana 6.75 6.75 6.75
Idaho 7.4 7.4 7.4
Colorado 4.63 4.63 4.63
Utah 5.0 5.0 5.0
New Mexico 7.6 7.6 4.8
Louisiana 8.0 8.0 7.3
Arizona 6.97 6.97 6.97
Federal 35.0 32.73 34.0

Rates as of April, 2013.

  • The small business rate is the effective tax rate for US $500,210 (comparable to the Canadian threshold of Cdn $500,000)
  • The small business income threshold for Nova Scotia and Manitoba is Cdn $400,000. For all other provinces the small business income threshold is Cdn $500,000

Source: Canada Revenue Agency, PWC Tax News Network and Federation of Tax Administrators
Alberta has one of the most competitive tax environments in North America. In 2009, combined federal and provincial corporate income tax was 29 per cent for general business and 14 per cent for small businesses. Municipalities in the Alberta Energy Corridor do not pay business taxes.

Alberta has no provincial capital taxes, and no sales tax, a refundable research and development tax credit and has a publicly funded health care insurance system – making Alberta’s tax environment very competitive.

Despite a global economic slowdown in 2008, Alberta’s economy remained strong and vibrant. In fact, Alberta’s economy grew by an estimated 1.5 per cent in 2008. Over the last two decades, Alberta had the highest gross domestic product (GDP) growth rate in Canada, at 3.5 per cent per year. Alberta’s exports of goods increased by one-third between 2007 and 2008 to an estimated $109 billion. While the demand for many of province’s natural resources weakened during the global downturn, Alberta’s ability to withstand economic declines is due to a low unemployment rate, a well trained workforce and an increasingly diversified economy.

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