Grande Prairie Population & Employment Forecasts ( ) Final Report Sun Life Place Street Edmonton, Alberta T5J 3H1

Transcription

1 Grande Prairie Population & Employment Forecasts ( ) Final Report 2220 Sun Life Place Street Edmonton, Alberta T5J 3H1 T November 29, 2013

2 Suite 2220 Sun Life Place Street Edmonton, Alberta T5J 3H1 T F applications@mac.com November 29, 2013 Shores Jardine Suite 2250 Bell Tower Avenue Edmonton AB T5J 0H8 Attention: Subject: Gwendolyn Stewart-Palmer Grande Prairie Population & Employment Forecasts ( ) Final Report Further to your request, we have prepared the subject report to project the future growth of the City of Grande Prairie to the end of If you have any questions on this submission, please give either me a call. Sincerely, Applications Management Consulting Ltd. Per: Darryl Howery Principal

3 Contents Introduction... 1 Purpose of the Projections... 1 The Study Area... 1 Scenarios of Growth... 2 Population & Employment Forecasting Model... 3 Driver Industries... 3 Support Sectors... 3 Net Migration... 4 Population Projections Base Year Population... 5 City of Grande Prairie... 5 Other Study Area Base Year Population Study Area Population by Age and Gender... 6 Natural Increase... 8 Fertility (Birth) Rates... 9 Mortality Rates... 9 Net Migration Additional Labour Force Required Additional Household Members Labour Force Projections Base Year Labour Force Driver Industries Driver Industry Labour Force Estimates (2012) Growth of Economic Driver Industries Agriculture Forestry Oil & Gas Exploration and Production Manufacturing Alternative Energy Support Industries i

4 Extending the Forecast to Population & Labour Force Forecast Results Population Forecast to Labour Force Forecast to Labour Force By Industry Appendices Appendix A: Intermunicipal Development Plan (IDP) Annexation Areas Appendix B: Economic Driver Industry Growth Rates Appendix C: Base Year Labour Force by Industry Appendix D: Detailed Population and Labour Force Results Appendix E: Annual Labour Force by Industry 2012 to Appendix F: 2006 Labour Force by Industry and Occupation ii

5 Introduction The City of Grande Prairie has recently been one of the fastest growing municipalities in Alberta. 1 Along with increased growth the municipality needs to plan for the future growth of the community. Population and employment forecasts have been prepared on behalf of the City of Grande Prairie by Applications Management Consulting Ltd. in relation to the City s proposed urban expansion area. PURPOSE OF THE PROJECTIONS In order to successfully plan for future growth and develop the necessary infrastructure to support that growth, forecasts of population and employment provide information on both the potential magnitude of growth, as well as the nature of that growth. Population projections are particularly important in long-term infrastructure planning as all key planning decisions, including those involving public facilities and services, depend on how many people will be living in the area. The potential for non-residential development is also important as from a fiscal point of view, non-residential development along with residential growth provides a community with balanced growth. The purpose of this study is to provide a long term, 50 year forecast of both population and employment. This is comprised of a detailed projection from ; and an extrapolation of the detailed forecast for an additional 15 year period from 2046 to THE STUDY AREA Population and labour force projections have been prepared for the City of Grande Prairie s existing municipal boundary and for a Study Area encompassing the City of Grande Prairie and a portion of the County of Grande Prairie. The geographic area covered by these projections is referred to as the Study Area and includes: City of Grande Prairie Hamlet of Clairmont 3 Short Term Annexation Area within the County of Grande Prairie No.1. 1 The Alberta Urban Municipalities Associated reported that Grande Prairie was among Canada s top 15 fastest growing communities. Between 2006 and 2011 the City of Grande Prairie grew by 16.8% making it the seventh fastest growing community in Canada. MuniLink/Communications/Member+Notices?contentId= Annual population forecast results are available for each year in the forecast period (see Appendix D). 3 Clairmont Heights Area Structure Plan, This plan has been used in developing the population growth projections for the hamlet. Grande Prairie Population & Labour Force Forecasts to 2061 Final Report 1

6 A map of the Study Area is shown in Figure 1. 4 Figure 1: Study Area SCENARIOS OF GROWTH A population and employment forecasting model was used to project growth for each of two scenarios. Base Scenario: This scenario represents the best guess as to the growth that can be expected for the Study Area. High Scenario: This scenario represents an optimistic but realistic picture of future growth that can be expected for the region. 4 City of Grande Prairie and County of Grande Prairie No. 1 Intermunicipal Development Plan. Adopted Departments/Planning~Development~Services/Docs/intermunicipal-development-plan.pdf Grande Prairie Population & Labour Force Forecasts to 2061 Final Report 2

7 In planning for future growth, it is prudent for a municipality to estimate land requirements on the basis of a high growth scenario. It is the high scenario that will serve as a more useful basis in planning for future land requirements for the City. As a result, when updating the land needs for the City of Grande Prairie, it is recommended that the high scenario has been used as the basis for determining this need. POPULATION & EMPLOYMENT FORECASTING MODEL The population and employment forecasts presented in this report have been prepared using Applications Population & Employment Forecasting Model. This model measures the changes in population attributable to natural increase (i.e. fertility and mortality projections of the population) and net migration. Net migration is based on an estimate of the labour force required to meet economic activity projections for what are referred to as Driver Industries of growth, as well as the related labour force required for other Support Sectors that provide goods and services to the Driver Industries and the population of the community and region. For the purposes of this analysis, the region is considered to be the trading area or catchment area of economic activity in and around the City of Grande Prairie. Figure 2: Population & Employment DRIVER INDUSTRIES Forecasting Model For each scenario, a series of growth rates were developed for the industries that are expected to lead growth in the region referred to as Driver Industries. For the Grande Prairie region, five Driver Industries have been identified as follows: Agriculture Forestry Oil and Gas Exploration & Production Manufacturing Alternative Energy The definition and projected growth rates for each of these industries is discussed in the Labour Force section of this report. SUPPORT SECTORS The Support Sectors include all other economic sectors in the regional economy. Growth in the Support Sectors is based on the local demand for goods and services from the Driver Industries as well as the increase in demand for commercial and non-commercial goods and Population (Year 1) Natural Increase Fertility Mortality Net Migration Population (Year 2) services that will result from growth of the population in the region. These sectors are projected to grow at a rate that supports the economic growth of the Driver Industries as well as the general population growth of the region. + Economic Activity Labour Force Driver Industries Support Sectors Grande Prairie Population & Labour Force Forecasts to 2061 Final Report 3

8 NET MIGRATION Based on the demand for workers for the Driver Industries and Support Sectors, the need for additional workers from outside the available labour force in the region is determined. If there is a projected worker shortage, net migration is assumed to fill the demand for workers. Net migration also includes the increase in population in the region due to the other family members associated with the labour force required to meet the demand for workers. Grande Prairie Population & Labour Force Forecasts to 2061 Final Report 4

9 Population Projections This section provides information on the methodology and assumptions used in generating the population projections. The methodology used in the model to project population includes an employment based method to project net migration along with the standard component method of projecting population growth. The standard component method takes into consideration fertility, mortality and net migration rates, which are the key factors that will affect population change BASE YEAR POPULATION The base year for the population forecast is As population data is not available from either the federal census or a municipal census for this year, base year data was constructed by extrapolating the 2011 federal census data to 2012 As a result, 2012 is considered a forecast year for the purposes of this analysis. CITY OF GRANDE PRAIRIE Between between 2001 and 2006 where the population increased by over 10,000 growing at an average annual rate of almost 5.0 per cent. The 2006 federal census reported the City of Grande Prairie as having a population of 47, In 2007 the City undertook a municipal census and reported a total population of 50, 227, representing a 6.7 per cent increase over the 2006 population. Since 2007, there has not been a Municipal Census for the City of Grande Prairie. The population from 2007 to 2010 has been estimated using an average annual growth rate of 2.3% from 2007 to The 2011 Statistics Canada Federal Census population for the City of Grande Prairie is 55, The 2012 base year population has been estimated using the population and employment projection model developed by Applications Management Consulting. The 2012 estimated population assumed a growth rate of 2.5% from 2011 to 2012, which is below the average annual growth seen from 2001 to ,000 50,000 40,000 30,000 20,000 10,000 0 City of Grande Prairie Population Statistics Canada, 2006 Community Profile for Grande Prairie 6 Statistics Canada 2011 Federal Census for the City of Grande Prairie. Grande Prairie Population & Labour Force Forecasts to 2061 Final Report 5

10 OTHER STUDY AREA BASE YEAR POPULATION Based on the unofficial County Municipal Census, the population for the Hamlet of Clairmont for 2012 is 3,992. The population for the Short Term Annexation Area within the County of Grande Prairie No.1 is estimated to be 1,488. Within the Short Term Annexation Area there are 8 Dissemination Areas 7 that contain 191 Dissemination Blocks 8 which are either wholly or partially in the Study Area. While most of the Dissemination Blocks are wholly contained within the Study Area, there are six (6) that are only partially within the Study Area. For those Dissemination Blocks partially within the study area, the proportion of the population that resides in the Study Area was estimated by reviewing the Dissemination Block maps in conjunction with Google maps for the Study Area STUDY AREA POPULATION BY AGE AND GENDER Based on the analysis, the 2012 population of the Study Area (see Figure 1) is estimated to be 61,493. This includes 56,395 within the current municipal boundary of the City, 3,992 in the Hamlet of Clairmont 9 and 1,106 within the Short Term Annexation Area within the Study Area. 10 The age and gender breakdown for these populations are based on the 2011 Federal Census for the City of Grande Prairie and County of Grande Prairie (Hamlet of Clairmont and the Short Term Annexation Area within the County). These populations broken down by age and gender, as used in the Base Year of the forecast, are summarized in Table 1 and Table 2 below. 7 The dissemination area, as defined by Statistics Canada, is a small, relatively stable geographic unit composed of one or more blocks ( people). It is the smallest standard geographic area for which all census data are disseminated. For a detailed definition refer to Statistics Canada 8 The dissemination block as defined by Statistics Canada, is an area bounded on all sides by roads and/or boundaries of standard geographic areas. The dissemination block is the smallest geographic area for which population and dwelling count data are disseminated. For a detailed definition refer to Statistics Canada 9 Based on the 2012 Unofficial County of Grande Prairie No. 1 Census. Information provided by the County of Grande Prairie. 10 Based on the 2012 Unofficial County of Grande Prairie No. 1 Census. Information provided by the County of Grande Prairie. Grande Prairie Population & Labour Force Forecasts to 2061 Final Report 6

11 Table 1: 2012 Study Area and City of Grande Prairie Population by Age and Gender TOTAL STUDY AREA CITY OF GRANDE PRAIRIE AGE COHORT TOTAL MALE FEMALE TOTAL MALE FEMALE 0-4 5,257 2,686 2,571 4,873 2,487 2, ,343 2,221 2,122 3,933 2,008 1, ,723 1,904 1,820 3,363 1,717 1, ,091 2,093 1,998 3,747 1,915 1, to 24 5,466 2,810 2,656 5,152 2,647 2, to 29 6,787 3,480 3,307 6,210 3,180 3, to 34 5,666 2,904 2,762 5,262 2,694 2, to 39 4,727 2,423 2,304 4,292 2,197 2, to 44 4,067 2,078 1,989 3,707 1,891 1, to 49 4,098 2,096 2,002 3,743 1,912 1, to 54 3,812 1,951 1,861 3,432 1,754 1, to 59 2,988 1,527 1,461 2,727 1,392 1, to 64 2,048 1,044 1,005 1, to 69 1, , to 74 1, to to Total 61,493 31,446 30,046 56,395 28,803 27,592 Grande Prairie Population & Labour Force Forecasts to 2061 Final Report 7

12 Table 2: 2012 Hamlet of Clairmont and Short Term Annexation Area within the Study Area by Age and Gender HAMLET OF CLAIRMONT SHORT TERM ANNEXATION AREA WITHIN COUNTY AGE COHORT TOTAL MALE FEMALE TOTAL MALE FEMALE to to to to to to to to to to to to to Total 3,992 2,075 1,917 1, NATURAL INCREASE Natural increase of the population consists of births and deaths. Applications Population & Employment Forecasting Model used to calculate future population estimates the number of births each year based on fertility rates by age of mother and estimates the surviving members in each age cohort then advances the age of the population in each of the age cohorts. Surviving members in each age cohort or age group is estimated in the model based on the reported mortality rate for each age cohort. Single year age data is used in the model for persons 0-19 years of age. For people 20 years and older, 5- year age cohorts are used for the ages years. For these age cohorts it is assumed that one-fifth of the surviving members of the age group advances to the next age category each year. The final age category includes all persons 85 years and older. Grande Prairie Population & Labour Force Forecasts to 2061 Final Report 8

13 FERTILITY (BIRTH) RATES Current local Grande Prairie region fertility rates were not available for the forecast. The most recent regional fertility rate information available at the time of preparing this analysis is 2005 for the former regional health authority area. 11 It is not expected that one year of fertility rate data would be representative of future rates. As a result, the fertility rates used in this analysis were estimated using the average of 10 years of provincial rates and the 2005 regional rates for the former regional health authority. The provincial fertility rates are calculated based on provincial birth and population data for the most recent previous 10 years at the time of the analysis (2000 to 2009). 12 The following table shows the estimated average fertility rates per 10,000 females by gender and age of mother utilized in the population forecasting model. Table 3: Fertility by Gender and Age of Mother per 10,000 Age Cohort GENDER AGE COHORT MALE FEMALE 15 years years years years years to 24 years to 29 years to 34 years to 39 years to 44 years to 49 years 3 3 MORTALITY RATES As with the fertility rates, current regional mortality rates were not available for Grande Prairie. The mortality rates used in the model reflect an average of provincial and regional rates calculated in a similar fashion as that for fertility rates. The provincial mortality rates are based on a 10 year (2000 to 2009) average of provincial mortality data. 13 The regional mortality rates are based on 2005 mortality rates by gender from Alberta Vital Statistics for the Peace Country Health Authority Region. The following table shows the estimated average mortality rates per 10,000 people by age cohort and gender used in the model. 11 Alberta Vital Statistics maintains fertility and mortality information at various geographic levels for the Province. This data was obtained for the 2008 analysis (2005 data) from the regional health authority. 12 Statistics Canada, Crude birth rate, age-specific and total fertility rates (live births), Canada, Provinces and Territories annually. Cansim table Statistics Canada, Deaths and mortality rates, by age group and sex, Canada, Provinces and Territories, annually. Cansim table Grande Prairie Population & Labour Force Forecasts to 2061 Final Report 9

14 Table 4: Mortality by Age and Gender per 10,000 Age Cohort GENDER AGE COHORT MALE FEMALE 0 years years years years years years years years years years years years years years years years years years years years to 24 years to 29 years to 34 years to 39 years to 44 years to 49 years to 54 years to 59 years to 64 years to 69 years to 74 years to 79 years to 84 years years 1,541 1,343 Grande Prairie Population & Labour Force Forecasts to 2061 Final Report 10

15 NET MIGRATION Net migration is determined for the Study Area based on the need for additional workers required to satisfy employment demands that cannot be satisfied from growth in the local labour force through natural increase. Thus, migration of workers is the balance between the total demand for workers and the number of workers available within the region through natural increase. ADDITIONAL LABOUR FORCE REQUIRED The Population Employment Forecasting Model utilized for this analysis projects the labour force that is required to meet worker demands in both the Driver Industries and Support Sectors. When the demand for workers exceeds the local labour force who are available to work, the model determines the net migration required to balance the labour market. To estimate the local supply of available workers, the model calculates the annual change in the 15+ population and applies a participation rate to identify the proportion of the 15+ population that is in the labour force. The labour force participation rate that is used in the model differs for the population and the 65+ population, as it assumed that a smaller proportion of the 65+ population will be in the labour force, although there is a trend of the increasing number of elder workers in the population. The participation rates for the population (81%) and 65+ population (50%) are based on the 2006 Statistics Canada Community Profiles. 14 ADDITIONAL HOUSEHOLD MEMBERS Net migration to the Study Area includes both the workers moving to the region for work as well as additional family members, as it is assumed that each worker moving to Grande Prairie for a job will bring family members. To estimate the number of family members and composition of net migrants to the region, the Components of Population Growth Table as published by Statistics Canada has been used to develop a migrant profile by age and gender (see Table 5 below). 15 The average household size for the City of Grande Prairie, which is 2.6 people per household, has been based on the 2011Statistics Canada Federal Census. The average household size for the areas outside of the City of Grande Prairie, including the Hamlet of Clairmont and the Short Term Annexation Area use an average household size for the County of Grande Prairie No.1 which is 2.8 people per household. 16 The model uses the total number of required workers that are not available locally and the average household size to estimate the total number of workers and their additional family members that are migrating into the Grande Prairie region. The following table provides the net migration profile for workers and their additional family members based on a10 year average ( ) of the components of population growth for Alberta. 14 Statistics Canada 2006 Community Profiles, The participation rates are assumed to be the same for the City of Grande Prairie and Grande Prairie County No Statistics Canada 2006 CANSIM Table This table includes immigrants, emigrants, and net interprovincial migration. 16 Statistics Canada 2011 Census Profiles, The average household size is available separately for the City of Grande Prairie and the County of Grande Prairie No.1. Grande Prairie Population & Labour Force Forecasts to 2061 Final Report 11

16 Table 5: Net Migration Profile per 1,000 Additional Workers AGE COHORT TOTAL MALE FEMALE 0 years years years years years years years years years years years years years years years years years years years years to 24 years to 29 years to 34 years to 39 years to 44 years to 49 years to 54 years to 59 years to 64 years to 69 years to 74 years to 79 years to 84 years years Total 1, Grande Prairie Population & Labour Force Forecasts to 2061 Final Report 12

17 Labour Force Projections The labour force projections for the Study Area are based on expected growth in several key Driver Industries that have been identified for the region. This section of the report describes the development of the base year labour force data and the methodology used to project future labour force levels. BASE YEAR LABOUR FORCE The 2012 Grande Prairie Study Area labour force is estimated at 37,586 people. This is broken down into 34,539 workers in the current boundaries for the City of Grande Prairie, 2,385 workers in the Hamlet of Clairmont and 661 workers in the Short Term Annexation Area within the Study Area. The estimated labour force the City of Grande Prairie is based on applying the industry breakdowns available from the 2011 National Household Survey to the estimated labour force in The estimated labour force for the other areas within the Study Area are based on applying the industry breakdown from the 2006 federal census to the estimated 2012 labour force. The labour force in 2012 is based on the population aged 15 and older by applying the labour force participation rates for the population in the and 65+ age groups as discussed in the previous section (see Net Migration). The 2012 labour force estimates by industry are provided in Appendix C. DRIVER INDUSTRIES The following five industries are identified as being the major economic drivers in the economic sub region of Grande Prairie. Agriculture Forestry Oil & Gas Exploration and Production Manufacturing Alternative Energy DRIVER INDUSTRY LABOUR FORCE ESTIMATES (2012) The labour force information available from Statistics Canada is broken down by major industry classifications using the NAICS (North American Industry Classification System (see Appendix F). To determine the labour force associated with each of the Driver Industries, this data has been reviewed to determine how much of each NAICS industry category contributes to the base labour force for the Driver Industry. The results of this analysis are presented in Table 6 below. 17 Statistics Canada, 2011 National Household Survey Profile: City of Grande Prairie. Grande Prairie Population & Labour Force Forecasts to 2061 Final Report 13

18 Table 6: Driver Industries Composition 18 DRIVER INDUSTRY INDUSTRY ALLOCATED FROM % OF 2 DIGIT NAICS INDUSTRY NOTES Agriculture 11- Agriculture, Forestry, Fishing and Hunting 65% All the workers in the Farms (3 digit) industry category were included. Forestry 11- Agriculture, Forestry, Fishing and Hunting 30% All the workers in the 113 Forestry and Logging (3 digit) industry category were included. 54- Professional, Scientific and Technical Services 10% All the workers in occupations related to Forestry and Logging (e.g. C022 Forestry Professionals) were included. A share of other occupations not specific to Forestry and Logging (e.g. H822 Other Trades Helpers and Labourers) but related to Forestry were included. Oil and Gas 21- Mining and oil and gas extraction 98% All the workers in the 211 Oil and Gas Extraction and 213 Support Activities for Mining and Oil and Gas Extraction (3 digit) industry categories were included. 54- Professional, Scientific and Technical Services 15% All the workers in occupations related to Forestry and Logging (e.g. C045 Petroleum Engineers) were included. A share of other occupations not specific to Forestry and Logging (e.g. C013 Geologists, Geochemists and Geophysicists) but related to Oil and Gas were included. Manufacturing Manufacturing 100% All the workers in the Farms (3 digit) industry category were included. 54- Professional, Scientific and Technical Services 2% All the workers in occupations related to Forestry and Logging (e.g. C022 Forestry Professionals) were included. A share of other occupations not specific to Forestry and Logging (e.g. C181 Computer Network Technicians) but related to Manufacturing were included. GROWTH OF ECONOMIC DRIVER INDUSTRIES Each of these industries has a particular level of influence on employment in the economic region of Grande Prairie and how they affect net migration of workers and their families to the region. The importance of each industry for the region are summarized in the following section. The information presented for each industry category is based on research of publicly available information and interviews with economic development officers of the municipalities within Grande Prairie. The growth rates for each industry are summarized in Appendix B. 18 Statistics Canada, 2006 Federal Census, XCB Grande Prairie Population & Labour Force Forecasts to 2061 Final Report 14

19 AGRICULTURE Agriculture has been the economic foundation of the regional economy of Grande Prairie since the community was established in the early 20th century. The 2006 Census of Agriculture indicates that there are 1,955 operators on 1,371 farms throughout Grande Prairie County No The farms in the Grande Prairie area are smaller (in acreage) than the Alberta average reflecting the diversity of agriculture operations in the region. The share of the regions 225,771 hectares dedicated to the key crops of canola, alfalfa and spring wheat is 72.1 per cent. The region recorded 77,900 head of cattle and calves along with 15,000 pigs. 20 In addition, the region is home to a large apiary industry, which produces 40% of Canada s honey. The region is also the worlds largest producer of creeping red fescue seed, which is exported and used in lawns, golf courses and pastures. 21 The region is also home to tree nursery facilities to support the replantation efforts of local forestry activities. Total farm related employment in the City of Grande Prairie represents 25 per cent of the region total, and more than doubled between 2001 and 2006 (from 145 to 330). Total farm related employment in the Grande Prairie region in 2006 was over 1,300 workers. 22 Looking toward the future, the regional college s involvement in alternative fuels may help shape the region s agricultural choices in the future. Studies are currently underway to test the commercial viability of farming pennycress for use as bio-diesel. Growth for this sector in each scenario is outlined as follows: Base Scenario: In the Base Scenario, employment in the agriculture sector is projected to be very modest (average annual growth of less than 1 per cent per year) over the first 15 years of the forecast and then declining over the last 20 years of the forecast (at 1/5 of a per cent per year). This is a result of a projected decline in employment in the agriculture sector over the long term. This is consistent with general employment trends in the agriculture sector across the province. In this scenario, it is expected that there would be limited growth in diversification of the crop base for alternative fuels and organic food production which will help to slow employment reductions in the Base Scenario. High Scenario: In the High Scenario, employment is -0.5% projected to be positive over the forecast period, in the range of 1.0 per cent to 1.5 per cent per year. In the High Scenario, it is expected that there will be a continued diversification of the crop and livestock production base in Base Scenario High Scenario the region supporting demand for organic foods. In addition, it is expected that new crops will be developed as a feedstock for alternative energy production. 1.5% 1% 0.5% 0% Figure 4 Agriculture 19 Statistics Canada, 2006 Census of Agriculture. 20 Statistics Canada, 2006 Census of Agriculture. 21 Peace Region Economic Development Alliance, 22 Statistics Canada, 2006 Federal Census, XCB Grande Prairie Population & Labour Force Forecasts to 2061 Final Report 15

20 FORESTRY The forest industry has long been a major contributor to the Grande Prairie economy and labour force. There are two major Forestry Management Agreements (FMA) located in the region. The first is the Weyerhaeuser Grande Prairie FMA. This agreement is for 1,138,284 total hectares of land and 885,434 hectares of harvesting land. Weyerhaeuser has maintained this FMA since January 3rd, 1969 and has renewed it to April 30th, Ainsworth Lumber Company Ltd. and Tolko Undustries Ltd. also operate on this FMA under agreement with Weyerhaeuser. As a result Weyerhaeuser operates a bleached kraft pulp mill and a dimension lumber sawmill in the fringe area of the county while Ainsworth Ltd. operates the second largest single-line Oriented Strand Board (OSB) plant in the world in the City of Grande Prairie. Ainsworth Lumber Company Ltd. has plans of adding a second manufacturing line to expand capacity and production scope when market conditions warrant the addition. The second FMA is held by Canadian Forest Products Ltd. (Canfor). This agreement is for 649,160 hectares of land with 474,193 hectares available for timber harvest. Canfor s original agreement began May 26th, 1964 the current agreement extends to April 30th, Tolko Industries Ltd. and Ainsworth Lumber Company Ltd. also operate on this FMA. Canfor Ltd. currently operates a dimension and MSR (Machine Stress Rated) lumber sawmill in the City of Grande Prairie. The forest products industry is also supported by a number of specialized companies in Grande Prairie region who are involved with harvesting, log hauling, forestry consultants and tree nurseries. Some of these smaller operators entire lumber supply is often dedicated to the support needs of the Oil and Gas industry for wood structures such as drill mats. The forest products industry has been suffering one of its deepest downturns in recent decades. This has almost universally hurt businesses in the forestry industry including those in the Grande Prairie region. However, in spite of this, regional employment in forestry and logging has remained relatively stable over the past decade. 3% 2% Figure 5 Forestry While the prospects for recovery of the forest products industry is mixed, largely as a result of the continued sluggishness in the US housing market, opportunities exist with emerging markets abroad. Economic development and industry representatives from the region have gone on international trade missions abroad (e.g. China) to promote local forest products in these markets. Expansion of foreign markets and the potential upswing in the US market (at some point) will help support growth in the forest products industry. 1% 0% Base Scenario High Scenario Growth for this sector in each scenario is outlined as follows: Base Scenario: In the Base Scenario, employment in the forestry sector is projected to be moderately positive over the forecast period, with average annual growth rates of 2.0 per cent in the first 15 years of the forecast and moderately to 1.5 per cent per year to the end of the forecast. In the short term, the Conference Board is projecting moderate GDP and employment growth for the forestry sector for the province as a whole. 23 In the longer term, the Conference Board projection for employment in the forestry sector is flat. It is expected that the local Grande Prairie forestry sector will out perform the 23 Conference Board of Canada Provincial Outlook Economic Forecast for Alberta: Spring Grande Prairie Population & Labour Force Forecasts to 2061 Final Report 16

21 province as a whole due to it being highly integrated and diversified in comparison to other forest product producing regions in the province. High Scenario: In the High Scenario, employment is projected to be positive over the forecast period, ranging from 2.0 per cent to 2.5 per cent per year. In this scenario, it is expected that there will be continued expansion of the value added processing of wood products, such as the proposed $300 million investment in an expanded OSB plant in Grande Prairie. 24 OIL & GAS EXPLORATION AND PRODUCTION The Grande Prairie region has been a primary location for the exploration and extraction of fossil fuels since the 1970 s when the Elmworth gas field was discovered. According to maps of natural gas pockets and oil deposits from the Alberta Geological Survey, Grande Prairie sits on top of large reserves of conventional natural gas, and is located in a region likely to contain unconventional natural gas sources. As well, Grande Prairie is located in close proximity to pockets of conventional oil as well as the Peace River Oil Sands. The natural gas fields below Grande Prairie extend throughout the county and into British Columbia. Grande Prairie s importance on a regional level for the oil and gas extraction and support activities is the result of the close proximity to several types of hydrocarbon resources and its location on a major transportation route towards Edmonton, and as a result many major oil and gas companies have chosen Grande Prairie as the location for their regional headquarters. According to the Peace Region Economic Development Alliance companies such as Conoco Phillips, Devon Canada, Nabors Canada and Haliburton Canada Partnership have regional offices in Grande Prairie. Between 2001 and 2006, employment in oil and gas extraction in Grande Prairie tripled, reaching over 1,000 workers in This growth represents an average annual change of over 25 per cent. Similarly, support activities for mining and oil and gas extraction almost doubled over the same period totaling almost 3,200 workers by This industry group grew at an average annual rate of 13 per cent over this period. The prospects for growth in the oil and gas sector continue to be promising. Since the economic downturn in 2008, oil prices have rebounded to pre-recession levels. This provides a strong financial incentive for the industry to both continue to undertake exploration activities as well as develop oil sands resources, located in the Peace River Oil Sands Area. The Conference Board of Canada is projecting oil prices to continue to grow over the long term, reaching almost $170 US by Figure 6 Oil & Gas 6% 4% 2% 0% Growth for this sector in each scenario is outlined as follows: Base Scenario High Scenario Base Scenario: In the Base Scenario, employment in the oil and gas sector is projected to be positive over the forecast period, with average annual growth rates starting at 3.5 per cent and tapering down to 1.75 per cent over the forecast period. This forecast trends with the Conference Board GDP forecast for oil and gas GDP in the province for the first half 24 Peace Region Economic Development Alliance, 25 NAICS 211 OIl and Gas Extraction, Statistics Canada, 2006 Federal Census, XCB NAICS 213 Support Activities for Mining, OIl and Gas Extraction, Statistics Canada, 2006 Federal Census, XCB Conference Board of Canada Provincial Outlook Long Term Economic Forecast: Grande Prairie Population & Labour Force Forecasts to 2061 Final Report 17

22 of the forecast. For the last half of the forecast period, employment in the oil and gas sector in Grande Prairie is expected to grow faster than the Conference Board GDP forecast due to the staging of oil sands development in the Peace River area from the Grande Prairie region. High Scenario: In the High Scenario, employment is projected to be positive over the forecast period, ranging from 5.5 per cent to 5.0 per cent in the first 10 years of the forecast. These rates reflect the a return to rapid growth in the sector that was occurring prior to the downturn and drop in oil prices in 2008, albeit at a significantly reduced rate of growth. 28 Over the long term, the High Scenario projections of employment growth for this sector are expected to range between 3.0 and 4.0 per cent. These rates of growth assume continued high energy prices as projected by the Conference Board and the increasing viability of Peace River OIl Sands Area. Grande Prairie is expected to continue to be a base for management and staging activities associated with the development of the Peace River oil sands. MANUFACTURING As the major centre for supplying manufactured goods in the region and as the regional transportation hub, Grande Prairie is well positioned to continue as an important centre for manufacturing that supports forestry, oil and gas and agriculture activities in northwestern Alberta and also northeast British Columbia. The Grande Prairie region currently hosts a variety of manufacturing enterprises from fabricated metal products to transportation equipment. The manufacturing sector in Grande Prairie is important to the oil and gas industry and is shown in a 2009 survey of Peace Country fabricators (of which Grande Prairie is a major component to the Peace Region). The majority of companies interviewed involved in fabricated metal products seek their work from the larger oil and gas companies as preferred contractors or strategically located contractors. Chemical manufacturing companies such as Erco Worldwide produce sodium chlorate which is needed for the forestry industry s pulp and paper processing. 29 Figure 7 Manufacturing The manufacturing sector in the Grande Prairie region is well organized and in a position to be innovators in their sector compared to manufacturers in other locations. The Peace Region Manufacturers Association was created as an initiative of PREDA to create a cohesiveness among the regions small and medium sized manufacturers and encourage them to group together to bid on larger projects as partners. The Centre for Research and Innovation (CRI) located at the Grande Prairie Regional College works with the regions manufacturing sectors on the patenting process and consulting on market opportunities for the products which are created. According to PREDA there is a possibility that the Peace Country may lead Alberta in patents per capita. 30 Growth for this sector in each scenario is outlined as follows: Base Scenario: Manufacturing in the Grande Prairie region is expected to largely follow growth in the forestry, oil and gas sectors. The rate of employment 4% 3% 2% 1% 0% Base Scenario High Scenario 28 These rates of growth are well below the double digit employment growth exhibited by this industry sector in Grande Prairie. 29 Erco Worldwide, 30 Peace Region Economic Development Alliance. Grande Prairie Population & Labour Force Forecasts to 2061 Final Report 18

23 growth in the Base Scenario for manufacturing reflects the average rate of growth for these other sectors. Growth rates range from 2.75 per cent to 1.75 per cent over the forecast period. High Scenario: A similar approach has been used in the High Scenario as to that for the Base Scenario, where manufacturing is expected to grow roughly in parallel with growth in the forestry, oil and gas sectors. In the High Scenario however, the rate of employment growth in manufacturing is stronger to reflect the capitalization on opportunities for exporting manufactured products outside of the region, building on the Peace River Manufacturers Association initiative to build a competitive and cohesive manufacturing sector. Growth rates in this sector range from 3.5 per cent to 2.5 per cent overt the forecast period. ALTERNATIVE ENERGY As a result of the increasing energy prices and the growing fears of climate change being linked to fossil fuels, research into practical alternatives is being undertaken. 31 The Grande Prairie region s strong agricultural sector, numerous lumber and forest products facilities and the Center for Research and Innovation (CRI) make it a prime region for developing, testing and using new forms of bio-diesel fuels and other kinds of alternate energy sources. The important component in bio-diesel production is vegetable oil. According to the CRI and PREDA the region is actively researching the viability of pennycress as a feedstock for the production of alternative fuels. What makes pennycress a preferred choice to some other alternatives is that it has higher oil content in its seeds, the ability to grow where other crops fail and it requires little to no inputs. According to the CRI there is also discussion between the large forestry companies and the agricultural sector to create a bio-energy facility that would be fed from wood and agricultural wastes. Over the forecast period, there is significant promise of potential for innovation and implementation of bio diesel fuels and other kinds of alternate energies in the Grande Prairie region. Base Scenario: No additional employment associated with the development of alternative energy products has been assumed to occur in the Base Scenario. This is a very conservative forecast position to take given the potential for development of alternative fuel sources and production in the Grande Prairie region, however, given that production has not been started, it has not been included in the Base Scenario. High Scenario: In the High Scenario, employment for Alternative Energy products has been assumed to grow at 15 jobs per year starting in 2015, for a total of 465 jobs by This would make the alternative energy sector roughly equivalent to the fabricated metal products manufacturing sector in Grande Prairie. 32 The delay in starting the additional employment for this sector reflects the incubation period to turn promising research into commercially viable products and the related employment. SUPPORT INDUSTRIES The model makes specific growth assumptions for the driver industries, based on research and potential in those industries. The industries that have not been identified as driver industries for the Grande Prairie region are considered support industries. The support industries are the industries that will grow relative to population growth over the forecast period. An estimate of the workers per capita was generated for the base year (2012), by using the base year labour force and population data each individually for the City of Grande Prairie, Hamlet of Clairmont and Short Term Annexation Area within the Study Area. To estimate 31 For example, the Federal government has mandated that diesel will be required to contain two percent of renewable content in Ampong-Nyarko, Kwesi. Pennycress Product Development & Preliminary Business Case, Alberta Agriculture & Rural Development, April NAICS 332 Fabricated Metal Product Manufacturing reported 475 jobs in Grande Prairie in Statistics Canada, 2006 Federal Census XCB Grande Prairie Population & Labour Force Forecasts to 2061 Final Report 19

24 the annual growth in the support industries, the workers per capita by industry is applied to the change in the population. EXTENDING THE FORECAST TO 2061 The detailed population and labour force forecast for the Study Area prepared for 2012 to 2046 was extended to 2061 by trending the population and labour force annual growth rates in the latter years of the 2012 to 2046 forecast period. The annual growth rate was then applied to the previous years total. Grande Prairie Population & Labour Force Forecasts to 2061 Final Report 20

25 Population & Labour Force Forecast Results The following section provides a graphical summary of the population, labour force, and labour force by industry for the City of Grande Prairie and Study Area. The detailed population and labour force forecast results are provided in Appendix D. POPULATION FORECAST TO 2061 The following graphs depict the City of Grande Prairie and Study Area population forecasts for 2012 to The population in the City of Grande Prairie is projected to grow from 56,395 in 2012 to 107,871 by 2061 in the Base Scenario. The Study Area population is projected to grow from 61,493 in 2012 to 116,496 by 2061 in the Base Scenario. The average annual rate of population growth for both the City of Grande Prairie and the Study Area is 1.4% over the 30 year projection period and is 1.3% between 2012 and Figure 8: Base Scenario Population Forecast to , ,000 96,000 84,000 Population 72,000 60,000 48,000 36,000 24,000 12, Year City of Grande Prairie Study Area Grande Prairie Population & Labour Force Forecasts to 2061 Final Report 21

26 In the High Scenario, the City of Grande Prairie population is projected to grow from 56,395 in 2012 to 158,634 by The Study Area population is projected to grow from 61,493 in 2012 to 170,883 by 2061 in this scenario. For the City of Grande Prairie the average annual rate of population growth is the same at 2.1% for the 30 year projection period out to 2042 and from 2012 to For the Study Area the average annual rate of population growth is the same at 2.1% for the 30 year projection period out to 2042 and from 2012 to Figure 9: High Scenario Population Forecast to , , ,000 Population 125, ,000 75,000 50,000 25, Year City of Grande Prairie Study Area In each instance, the Base and High Growth Scenario projections are at average annual rates of growth that are well below the historic averages for the City of Grant Prairie. Figure 10: Historic Population Growth vs Forecast (Average Annual Growth Rate) Historic Forecast % 2.7% % 4.1% % 3.4% Base Scenario 1.3% High Scenario 2.1% 0% 1% 2% 3% 4% 5% Grande Prairie Population & Labour Force Forecasts to 2061 Final Report 22

27 Between 1991 and 2011, the City of Grande Prairie grew at an average annual rate of 3.4%. Even in the High Scenario, where the City s population is projected to grow at an average annual rate of 2.1%, this is over 35% lower than the rate the City has grown at over the past 20 years. LABOUR FORCE FORECAST TO 2061 The following graphs depict the City of Grande Prairie and Study Area labour force forecasts for 2012 to In the Base Scenario, the labour force in the City of Grande Prairie is projected to grow from 34,539 in 2012 to 63,703 by The Study Area labour force is projected to grow from 37,586 in 2012 to 68,781 by 2061 in the Base Scenario. Both the average annual growth rate for the City of Grande Prairie and Study Area is 1.4% over the 30 year projection period, and is 1.2% between 2012 and Figure 11: Base Scenario Labour Force Forecast to ,000 61,250 52,500 Population 43,750 35,000 26,250 17,500 8, Year City of Grande Prairie Study Area Grande Prairie Population & Labour Force Forecasts to 2061 Final Report 23

28 In the High Scenario, the City of Grande Prairie is projected to grow from 34,539 in 2012 to 92,733 by The Study Area labour force is projected to grow from 37,586 in 2012 to 99,974 by 2061 in the High Scenario. For both the City of Grande Prairie and the Study Area the average annual rate of labour force growth over the 30 year projection period is 2.1% and from 2012 to 2061 it is 2.0%. Figure 12: High Scenario Labour Force Forecast to , ,000 80,000 Population 60,000 40,000 20, Year City of Grande Prairie Study Area LABOUR FORCE BY INDUSTRY The industry labour force shares for this analysis are based on the growth in the driver and support industries. The allocation of labour force by industry to each of the geographies included in the analysis (e.g. City of Grande Prairie, Hamlet of Clairmont and Short Term Annexation Area in the Study Area) in the forecast years has been assumed to be in proportion to the industry allocations in the Base Year (2012). The labour force by industry projections for the City of Grande and Study Area are available in Appendix E. Grande Prairie Population & Labour Force Forecasts to 2061 Final Report 24

29 Appendices Grande Prairie Population & Labour Force Forecasts to 2061 Final Report 25

30 APPENDIX A: INTERMUNICIPAL DEVELOPMENT PLAN (IDP) ANNEXATION AREAS Grande Prairie Population & Labour Force Forecasts to 2061 Final Report 26