Across almost every major economic indicator, Nova Scotia and New Brunswick under-perform the rest of Canada and rank amongst the poorest regions in the country. Nova Scotia and New Brunswick rank eighth and ninth, respectively, amongst the provinces for average household income. Only Prince Edward Island has a lower average household income level.
An even more dramatic indicator of the prosperity gap is the fact that the average household income in Nova Scotia and New Brunswick is less than four-fifth that of the top three provinces: Alberta, Saskatchewan, and British Columbia.
A key part of the explanation for the poor performance of both provinces is their inability to attract private sector investment. Such investment is the foundation for prosperity. As with the average household income measure, Nova Scotia and New Brunswick rank third last and second last, respectively, of the 10 provinces. Only Prince Edward Island attracts less investment.
Tellingly, the average level of private sector investment per private sector worker over the period was just 51.0 per cent (Nova Scotia) and 52.2 per cent (New Brunswick) of that in neighbouring Newfoundland & Labrador, which ranked third in Canada.
The dearth of private sector investment in both provinces is a central explanation for the record of weak job creation. In the average annual growth rate in employment in Canada between 2004 and 2013, by province, for both the private and public sectors, Nova Scotia ranks ninth and New Brunswick last. In fact, Nova Scotia’s job creation record over this period was just half and New Brunswick’s less than one third that of Newfoundland & Labrador.
*This article appeared in the Telegraph Journal on 10 December 2014