[Halifax] For the first time in recent history, New Brunswickers are generating more wealth than Nova Scotians, according to new research in a report from the Atlantic Institute for Market Studies.
The report, carried in AIMS’ monthly fax broadcast which will be distributed to subscribers this weekend, shows that New Brunswick’s GDP per capita – the average value of economic activity for each person in the province – has pushed past Nova Scotia’s and stayed considerably stronger. That stands the long-term economic relationship between the two provinces on its head, despite the boost offshore activity has brought to the Nova Scotian economy.
Historic unemployment patterns have also reversed. The jobless rate in New Brunswick has been uncharacteristically less than Nova Scotia’s since 1993.
“This appears to be the start of a long-term trend,” wrote Fred McMahon, AIMS’ senior policy analyst and the author of the report.
The reversal of relative strength is a big break with the historic pattern. It flies in the face of history as Nova Scotians for a long time had a more vibrant economy and less unemployment than their neighbours to the east. What makes it particularly surprising, the report says, is that a number of political and economic factors seem to suggest that Nova Scotia should be pulling even farther ahead.
Mr. McMahon points out that the turn-around came at the time when the forest industry – much more important to New Brunswick than to Nova Scotia – was facing huge problems as both the number of jobs and the prices of products have declined. Meanwhile Nova Scotia benefited from increased offshore exploration and development.
At the same time, the Port of Halifax has continued to out-pace Saint John as a gateway to the world. And even federal transfers, down sharply in both provinces, have declined less in Nova Scotia than in New Brunswick.
So why has New Brunswick so thoroughly outpaced Nova Scotia in recent years?
The answer, says Mr. McMahon, seems to boil down to the quality of governance. New Brunswick has been more focused in recent years on economic priorities, and the Nova Scotia government slower to get its financial house in order and more willing to spend money in pursuit of votes.
Mr. McMahon has spent much of the past year researching what it takes to get an economy really moving – work that will culminate in a major economic development conference in Halifax next month, and in a book that will follow.
Don Cayo, the former president of AIMS, said New Brunswick should be given full credit for leading the regional economic pack. “But the scale of New Brunswick’s economic success should be kept in perspective.
“We’re bringing in speakers from places like Ireland, where growth has been in the double digits for much of this decade. Yet in this region, even in New Brunswick, the best we can typically do is two or three per cent.”
The AIMS conference, being offered in partnership with the Atlantic Provinces Chamber of Commerce, runs May 6-8 at the Lord Nelson Hotel in Halifax.