THUNDER BAY — The Conference Board of Canada has released its final quarter outlook on the Thunder Bay metropolitan economy for the remainder of 2024 and into next year.
The report focuses on key trends and factors that will help or impede growth in the region and includes the economic drivers of house construction, manufacturing, immigration targets, critical mineral production and electric vehicles.
Robin Wiebe, a senior economist with the Conference Board, told The Chronicle-Journal that they assessed how long it will take for lower borrowing costs and easing inflation to help Thunder Bay's economy regain its footing.
"Thunder Bay's gross domestic product will shrink 0.2 per cent this year, but expand two per cent in 2025, in part due to lower interest rates," he said, adding that construction and health care will be the fastest growing 2025 sectors.
Wiebe says construction of the $1.2-billion jail, art gallery and Hyatt House Hotel will not completely offset drags elsewhere in 2024.
"That's why local GDP is forecast to decline," he said. "Next year looks better with both construction and manufacturing services growing."
Wiebe added that the local manufacturing sector has never recovered from the decline in the forestry sector.
"In 2023, it was half the size it was in 2000," he said. "Alstom's struggles haven't helped. We expect negligible manufacturing output change this year and in 2025."
Sectors of the local economy that are bearing the brunt of the overall job losses forecast this year include transportation/warehousing, -0.313 per cent; health care, -0.582 per cent; arts and entertainment, -0.272 per cent and accommodation/food -0.307 per cent.
Wiebe noted that lithium prices remain well off 2022 peaks with no news of progress on the development of local lithium plants.
New immigration changes announced by Immigration, Refugees, and Citizenship Canada (IRCC) earlier this year have led to a significant decline in international student enrolment at post-secondary institutions this fall.
According to Statistics Canada, Thunder Bay had a net immigration of about 2,200 people in 2022 and 2,500 in 2023.
"We estimate 825 arrivals for 2024 and project 815 for 2025," Wiebe said.
He surmised that Thunder Bay struggles to keep people here likely because of its economy being frequently poor and because of its relatively remote location.
Wiebe illustrated the historical and projected population growth in the city and said they "expect modest (growth) advances."
In 2010, the Thunder Bay population was 125,020, with a decrease of 47 people from the previous year. In 2023, the population was 131,750, growing that year by 2,050 people. That grew again in 2024 to 132,528, reflecting a growth of 778 people.
The Conference Board is projecting a continuous incline.
In 2025, they forecast a population increase to 132,690; in 2026, an increase to 132,836; in 2027, an increase to 132,895; and in 2028, a population increase to 132,906.
The unemployment rate in 2024 has risen to 6.3 per cent following 5.4 per cent in 2023 and 5.3 per cent in 2022.
"Employment will ease this year, lifting the unemployment rate," Wiebe said. "Employment will grow in 2025, but the unemployment rate will still edge up as the labour force grows faster than employment."
The Chronicle Journal / Local Journalism Initiative
