MONITORING THE METROS: A MUCH-AWAITED 2011 UPDATE

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1 THE METRO BEAT TD Economics MONITORING THE METROS: A MUCH-AWAITED 211 UPDATE The 211 National Household Survey release on May 8 th provides a demographic and diversity update across Canada. This is the third of a three-part overview series by TD Economics, following Aboriginal and immigration in-depth articles. The focus in this publication is to survey developments at the metro level. Western Canada From 26-11, population growth was the strongest in Western Canada. Among major Canadian urban centres, Calgary, Edmonton, Saskatoon and Vancouver have had the best record on this front. The share of Aboriginals in the total population has increased and remained strongest in the western cities we cover, besides Vancouver. Central Canada The immigration mix in Central Canada varies more than anywhere else in the country: just 4.4% of the Québec City population is comprised of immigrants, whereas 48% of the Toronto population is classified as first generation Canadians. Atlantic Canada An ageing population and negative net interprovincial migration have left Atlantic Canada in need of a boost from international immigration. This outcome did come to fruition: Saint John, Halifax and St. John s experienced 85%, 134% and 186% increases in net international immigration versus the 26 Census. Unemployment Job Creation Average Home Price Population Average Household Rate 1 (s) ($s) 1 ('s) 2 Income ($) 1 Data last updated Apr Q1 Apr-213 Mar Western ,516 1,495 Central ,83 91,824 Atlantic ,439 Notes: 1 Population weight based only on the 3 to 6 metros in our short list. TABLE 1: TD REGIONAL OVERVIEW 2 For Saint John and St.John's, figures approximated using the 211 census and average population growth rate. Source: Statistics Canada, FP Markets, Canadian Real Estate Association, Conference Board of Canada. Calgary Edmonton Saskatoon Vancouver Winnipeg Victoria Toronto Ottawa-Gatineau Québec Montréal Hamilton St. John's Halifax Saint John RESOURCES DRIVING DEMOGRAPHICS Population Growth , % Source: Statistics Canada; 211 Census of Population Vancouver Calgary Winnipeg SOME OF THE MOST DIVERSE CITIES IN THE WORLD Share of Immigrants in Population, % Edmonton Victoria Saskatoon Toronto Hamilton Montréal Ottawa-Gatineau Source: Statistics Canada; 211 National Household Survey Québec Canada : 2.6% Halifax Saint John St. John's Sonya Gulati, Senior Economist Sonny Scarfone, Research Associate

2 WESTERN CANADA Among the fourteen metros that we regularly survey for this publication, the four with the strongest population growth from were Calgary (12.6%), Edmonton (12.1%), Saskatoon (11.4%) and Vancouver (9.3%). Much of the population growth in these regions can be attributed to increased net international immigration. Two of the three cities with the highest share of immigrants are in Western Canada: Vancouver at 4% and Calgary at 26.2%. These regions have typically performed well on this measure, although Calgary s share has ramped up over the past decade. Between 26 and 211, Winnipeg and Saskatoon saw their foreign-born share of total population increase to 2.6% and 1.7%, respectively. As reported in the last edition of the Metro Beat, Saskatoon has in recent years been outperforming all Canadian CMAs in regards to demographics. Of the total foreign born who lived in Saskatoon as of 211, 42% of them arrived between 26 and 211. To put this impressive performance in perspective, the comparable figure in Vancouver is 17% and Toronto is 15%. By contrast, Victoria and Edmonton both saw decreases in the share of immigrants in their population, a record only matched by Hamilton in the rest of the country. Since the 26 Census, the main source country for new immigrants settling in Victoria, Calgary, Edmonton, Saskatoon and Winnipeg has been the Philippines. In Vancouver, China continues to be the top source country, although the Philippines ranked second. India and China share second and third place in all regions in Western Canada, except Victoria, where the United States is in second place. Victoria s proximity to the U.S. border GENERATION STATUS IN WESTERN CANADA Share of Population, % Victoria Vancouver Calgary Edmonton Saskatoon Winnipeg Source: Statistics Canada; 211 National Household Survey Third Generation Second Generation First Generation SASKATOON HAS ATTRACTED MORE IMMIGRANTS SINCE 26 THAN THE 25 PREVIOUS YEARS Share of Total Immigrants, % Victoria Vancouver Calgary Edmonton Saskatoon Winnipeg Source: Statistics Canada; 211 National Household Survey 1981 to to 211 might explain why the U.S. ranks so high. Out-sized Aboriginal peoples population growth is another reason for strong overall demographic performances. Nationally, Aboriginal peoples comprise 4.3% of the total population. Three cities in Western Canada well exceed this national metric: Winnipeg (11%), Saskatoon (9.3%) and Edmonton (5.4%). By contrast, the cities outside the West with the highest share of Aboriginal peoples in their population are Halifax and Ottawa-Gatineau, both at 2.5%. Given the large influx of net international immigrants to certain metro areas, the median age of the population in the West shows much variability. This is not surprising given that most new immigrants in Canada fall into the age cohort. The average median age ranges from 35.4 in Saskatoon to 44.2 in Victoria an almost ten year difference. These two cities represent the lowest and highest figures among Canadian metros. Aside from Saskatoon, Calgary and Edmonton are the two youngest urban centres in Canada. The median age in Calgary and Edmonton is 36.4 and 36.5, respectively. Continued healthy gains in population growth should help real GDP growth clock in above 2% in 213 and nearly 3% or more in 214 for most of the metros in the west. This profile exceeds that of Central and Atlantic Canada. As for the near-term housing outlook, renewed stability is expected in the resale housing market, which is a characteristic of a soft-landing. New home construction is also slated to break ground at a pace consistent with demographically-driven demand going forward. 2

3 CENTRAL CANADA In comparison to their western peers, annual population growth in Central Canada was far less impressive from None of the regions included in our list saw annual increases exceeding 2%. A case in point, Hamilton registered population growth of less than 1% and Montréal just surpassed the 1% mark. Relatively speaking, Toronto and Ottawa-Gatineau performed better with annual population growth of 1.75%, but this pace is much slower than was the case from Over 6% of newcomers to Canada select Montréal, Toronto and Vancouver as their new home every year. These regions continue to be the favoured destination for new Canadians, although National Household Survey numbers confirm that more immigrants are choosing to settle in other areas, particularly Western Canada. As of 211, nearly half of Toronto s population was foreign born, one of the highest in the world for a nonresource based developed city. This statistic helps shape Toronto s reputation as one of the most multi-cultural in the world. By contrast, 5% of Québec City s residents are first generation. Unlike Western Canada, the source countries for immigrants who come to Central Canada vary quite markedly by metro area. While 68% of recent immigrants in Toronto are from Asia, the share drops dramatically to 26% in Montréal. Compared to Toronto, the Frenchspeaking metro has a higher share of immigrants from the Americas (24.4% vs. 13.9%), Europe (17.6% vs. 1.8%) and Africa (32.2% vs. 6.7%). While the Philippines, India and China are popular source countries in Ontario metros, French-speaking Algeria, Morocco, Haïti and France dominate the inflows THE CHANGING FACE OF THE TOP CMAS Share of immigrants , % Vancouver Toronto Montréal 155, ,75 189,73 Oceania Asia Europe Africa Americas LINGUISTIC VARIETY IN CENTRAL CANADA Mother Tongue, % Hamilton Toronto Ottawa- Gatineau Montréal Source: Statistics Canada; 211 Census of Population. Québec Neither English nor French Both English and French French English observed in Montréal and Québec. As a result, language plays an important role in identifying and explaining immigration patterns. In 211, a quarter of Montrealers and nearly half of Torontonians reported that neither English nor French was their mother tongue. English is the mother tongue of 53.8% of people in Toronto, a national low in Englishspeaking provinces (Ottawa-Gatineau being in both Ontario and Québec). French is the mother tongue of 63.3% of people in Montréal and 94.9% in Québec City. The most frequently reported non-official language spoken in a CMA across Canada is Spanish in Montréal, spoken by a quarter of a million people. In 26, a study by the Association for Canadian Studies in Montreal identified the city as the most trilingual in the country, with 18.4% of its population able to converse in at least three languages. A more recent study has not been released since; however, we suspect based on immigration figures and source countries that the figure is above 2% today. While demographics are expected to be a plus for many Central Canada metros, the economic backdrop is forecast to be modest. Montréal and Toronto are both poised to have GDP growing in the 1.2%-1.3% range in 213 and in the 2.3%-2.7% range in 214. Other metros are not slated to perform much better. Negative yearover-year employment growth has led to an increasing unemployment rate over the last quarter. Given the climate, housing is also not set to be a major contributor to headline economic growth in Source: Statistics Canada; 211 National Household Survey 3

4 ATLANTIC CANADA Negative net interprovincial migration has left Saint John and Halifax with annual population growth below 1% since the previous Census. St. John s population outperformed its peers at 8.8%. Atlantic CMAs are among the very few in Canada without a double-digit share of immigrants in their population: 3% in St. John s, 4.3% in Saint John and 8.1% in Halifax. Québec City is the only other urban centre that makes the list. The same can be said about visible minorities, going from 2.5% in St. John s to 9.1% in Halifax. In each city, more than 8% of the population is at least 3 rd generation Canadian. Correspondingly, each city in our list has above 9% of its population speaking English as their mother tongue. While immigration in Atlantic Canada remains small in absolute terms compared to other Canadian CMAs, it has grown rapidly over the last decade: 38% of these cities immigrants came from abroad between 21 and 211 alone. These metrics were close to 15% or below for the three previous decades. This is a much needed offset for a rapidly ageing population. Looking at the dependency ratio - a measure of pressure on the labour force - Saint John in particular is facing a demographic drag. The city s ratio is 2 nd highest after Hamilton nationwide. However, the increase in the share of immigrants in total population does not seem to follow. The share of immigrants did not register gains greater than.7 percentage points in any of our surveyed cities. Halifax scored the highest on this front. While the Atlantic region has never been a major hub of Aboriginal peoples population, people reporting as having an Aboriginal identity nearly doubled in all three CMAs surveyed. This trend can be explained by a higher fertility rate and an increased tendency to self-report as Aboriginal. A negative net interprovincial migration balance for these provinces may have also contributed to the doubling of the share in these cities. These continued poor demographic showings argue in favour of our weak GDP growth forecast over 213 and 214. Saint John will record sub 2% growth in both years, while Halifax will barely reach the mark in 214 at 2.2%, following a lacklustre 1.6% in 213. St. John s will reach 3.7% this year, but this is following no growth in 212 due to offshore oil production fields underperforming. As a result, housing prices are not expected to make any meaningful gains over the next two years. 2, 1,5 1, 5 MOST IMMIGRATION IN 4 YEARS IN ATLANTIC CMAS Immigrants in Saint John and St. John's Immigrants in Halifax 2,5 Saint John (lhs) St. John's (lhs) Halifax (rhs) 1971 to to to 2 21 to 211 Source: Statistics Canada; 211 National Household Survey MORE PEOPLE IDENTIFYING AS ABORIGINAL Respondents identifying as Aboriginals, % Saint John Halifax St. John's Source: Statistics Canada; 211 National Household Survey Saint John St. John's Halifax Hamilton Montréal Québec Toronto Ottawa-Gatineau Victoria Winnipeg Saskatoon Edmonton Vancouver Calgary DEPENDENCY RATIO Population 15- and 65+ Divided by Population of Working Age 15, 12, 9, 6, 3, Source: Statistics Canada; 211 Census of Population

5 TABLE 2: TD METRO OVERVIEW Employment Cost of Living Demographics Real GDP Forecast 3-Month Moving Average Growth Data last updated Apr-213 Apr Unemployment Rate % (Quarter Average) Unemployment Rate % 213Q1 Apr CPI Personal Disposable Income Growth Population Growth National Immigration Share (Annual Average) % 214 % Apr Q1 Apr Q1 May 213 May 213 Canada West Victoria, BC Vancouver, BC Calgary, AB Edmonton, AB Saskatoon, SK Winnipeg, MB Central Hamilton, ON Toronto, ON Ottawa/Gatineau, ON/QC Montréal, QC Québec, QC Atlantic Saint John, NB Halifax, NS St. John's, NL Notes: 1 Indicates if the relevant monthly metric is above or below its recent 3-month trend Q1 approximation as of May 213 by TD Economics. 3 Missing data: CPI for Hamilton, Personal Disposable Income and Immigration for Saint John and St. John's. Source: Statistics Canada, Canada Mortgage and Housing Corporation, the Canadian Real Estate Association, la Fédération des Chambres Immobilières du Québec and the Conference Board of Canada as of May

6 Home Prices TABLE 3: TD METRO OVERVIEW Home Sales Housing Construction Housing Forecast 4 Average Home Price ($s) Q1 over Q1 % Sales (s) Q1 over Q1 % SAAR Permits (s) 3 (Units) Y/Y% Starts (s) Prices ($s) Sales (s) Data last updated Apr-213 Apr-213 Mar-213 Apr-213 Apr-213 Mar-213 Apr-213 Mar-213 May 213 May 213 May 213 May 213 May 213 May 213 Canada West Victoria, BC Vancouver, BC Calgary, AB Edmonton, AB Saskatoon, SK Winnipeg, MB Central Hamilton, ON Toronto, ON Ottawa/Gatineau, ON/QC Montréal, QC Québec, QC Atlantic Saint John, NB Halifax, NS St. John's, NL Notes: 1 Housing data for Montréal and Québec are available on a quarterly basis (latest: Q1 213). 2 For home sales, data is for Ottawa-Carleton. 3 Seasonally adjusted data at annual rate. 4 These forecasts were generated by TD Economics as of May 213. Not available for St. John's. Source: Statistics Canada, Canada Mortgage and Housing Corporation, the Canadian Real Estate Association, la Fédération des Chambres Immobilières du Québec and the Conference Board of Canada as of May

7 TABLE 4: 211 CENSUS AND NATIONAL HOUSEHOLD SURVEY SUMMARY Population (s) Number of Households (s) Median Age Generation Status, % 1 Share of Aboriginal in Population, % Share of Immigrants in Population, % Share of Visible Minorities in Population, % st 2nd 3rd West Victoria, BC Vancouver, BC 2, , Calgary, AB 1, , Edmonton, AB 1, , Saskatoon, SK Winnipeg, MB Central Hamilton, ON Toronto, ON 5, , , Ottawa/Gatineau, ON/QC 1, , Montréal, QC 3, , , Québec, QC Atlantic Saint John, NB Halifax, NS St. John's, NL Refers to whether or not the person or the person's parents were born in Canada. It identifies persons as being first generation, second generation or third generation or more. Source: Statistics Canada; 211 National Household Survey; 211 Census of Population 7

8 TABLE 5: 211 NATIONAL HOUSEHOLD SURVEY SUMMARY Immigration: Main Source Countries (s) Non-official languages most spoken (s) West Country # Country # Country # Language # Language # Language # Victoria, BC Philippines.9 U.S..8 China.8 Spanish 8.7 German 6.7 Chinese n.o.s Vancouver, BC China 36.9 Philippines 25. India 2.5 Panjabi Cantonese Mandarin Calgary, AB Philippines 13.2 India 8.6 China 6. Spanish 4.8 Tagalog 39.6 Panjabi 36.1 Edmonton, AB Philippines 1.4 India 7. China 3.8 Tagalog 33. Spanish 25.8 Panjabi 24.2 Saskatoon, SK Philippines 4.2 China.9 India.6 German 6.3 Tagalog 6.2 Ukrainian 4.6 Winnipeg, MB Philippines 21.4 India 5.6 China 2.4 Tagalog 45.7 German 23.5 Ukrainian 13.5 Central Hamilton, ON Philippines 1.6 U.S. 1.3 Iraq 1.2 Italian 26.2 Spanish 14.5 Polish 11.7 Toronto, ON India 59.7 China 46.3 Philippines 45.6 Italian Cantonese Panjabi 29.3 Ottawa/Gatineau, ON/QC China 2.8 Haïti 2.7 Philippines 2.6 Arabic 47.4 Spanish 46.6 Italian 17.8 Montréal, QC Algeria 18.9 Morocco 16.4 Haïti 13.7 Spanish Arabic Italian Québec, QC France 2. Colombia 1.5 Morocco.6 Spanish 29.7 Arabic 4.7 German 3.2 Atlantic Saint John, NB S. Korea.3 China.2 U.K..2 Spanish.9 Korean.5 Arabic.5 Halifax, NS U.K..9 Iran.6 Philippines.6 Arabic 6.9 Spanish 4. German 2.8 St. John's, NL U.S..2 Pakistan.2 China.1 Spanish 1.1 German.7 Chinese n.o.s In which respondent can conduct a conversation. 2 Chinese n.o.s. (not otherwise specified) includes any reported language from China but did not provide further detail. Source: Statistics Canada; 211 National Household Survey 8

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