New Brunswick's GDP jumps 1.9% thanks to manufacturing sector

New Brunswick's economy grew by 1.9 per cent in 2015, the highest rate in Atlantic Canada, as the province took advantage of strong performances in the agriculture, forestry, fishing and manufacturing industries.

The province's growth rate in 2015 is the largest boost in the economy since 2010 and is a clear turnaround from the 0.3 per cent drop in 2014.

The GDP figures were released by Statistics Canada on Thursday and showed New Brunswick's growth in several sectors — including industrial production, non-durable manufacturing, goods-producing industries and agriculture, forestry and fishing — led the country.

David Campbell, the chief economist for the province's Jobs Board, said the growing GDP, which is the value of the goods and services produced, should lead to increased jobs over time.

"It should lead to jobs, but it also creates a larger economy on which we can raise taxes to pay for public services," Campbell said.

"People need to understand that a flat economy means we have to struggle with, do we raise more taxes? Do we cut more spending? There is a direct correlation between the growth in the economy and the government's ability to pay for public services and public infrastructure."

New Brunswick's GDP growth of 1.9 per cent is compared to Prince Edward Island's growth of 1.5 per cent, Nova Scotia's 0.8 per cent and a decline of 2.2 per cent in Newfoundland and Labrador.

Overall, Canada's GDP rose by 0.9 per cent in 2015.

GDP up, export sales down

Joel Richardson, the vice-president of the Canadian Manufacturers and Exporters in New Brunswick and Prince Edward Island, said the rising GDP is important.

But he said it's important to put the 2015 figures into perspective given the poor growth and export levels the province has experienced in recent years.

"Any time GDP moves up, it is a positive indication, however our export sales numbers have not caught up to where they were prior to 2011," Richardson said.

"And our job numbers within the manufacturing sector, we've lost almost 6,000 manufacturing jobs in the last decade in New Brunswick. Those are direct jobs, that doesn't include all the indirect jobs."

The industry official said the GDP growth was predictable considering the weak Canadian dollar in the latter half of 2015.

"So as soon as the dollar starts to go down, our GDP and our exports go up," Richardson said.

There are some worrisome clouds on the economic horizon, however.

Richardson said export sales are down 24 per cent, which is a concern. For the economy to continue to see growth, Richardson said the different levels of government need to look at helping major capital projects, such as the Sisson mine and the Energy East pipeline, move forward.

In the Statistics Canada report, potash exports helped push New Brunswick's GDP higher in 2015. But PotashCorp. announced it was closing its Sussex mine in January, which will have an impact on the 2016 level.

The province's chief economist said there are some bright spots in the economic outlook.

"We are very excited about agriculture, blueberries will continue to be strong, we are optimistic about aquaculture," Campbell said.

"But this demographic overhang and the fact we don't have large infrastructure projects are a problem."