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Friday, November 20, 2009 |
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Friday, November 20, 2009 |
News Release: March 19, 2009 Alberta business sentiment remains steady despite economic turmoil, BSI shows Edmonton, Alberta – Alberta businesses remain neutral about the province’s economic prospects despite discouraging news and difficult circumstances, according to the latest ATB Financial Business Sentiments IndexTM (BSI). The BSI surveys companies throughout Alberta to gauge their opinion and sentiment for the coming quarter. Expectations for the second quarter of 2009 have scarcely budged from sentiment that prevailed in the first quarter, receding only slightly from 99.7 to 99.5. (An index value more than 100 indicates optimism, and less than 100 indicates pessimism.) “I think this report tells us that Alberta businesses are remaining on a remarkably even keel in extremely difficult circumstances. Even though the economic situation – both locally and globally – has deteriorated significantly since before Christmas, Alberta companies seem to be saying: ‘Things won't get any worse,’ ” said Todd Hirsch, ATB’s Senior Economist. At 99.5, the seasonally adjusted index level for the second quarter of 2009 is down substantially from the second quarter of 2008, when the index stood at 136.5. The BSI, a joint effort of ATB and the Western Centre for Economic Research at the University of Alberta School of Business, surveyed 428 companies between Feb. 23 and March 6. The sentiments index is down in three of the six sectors measured: oil and gas, professional/technical, and wholesale. Oil and gas companies surveyed have become far more pessimistic about their immediate economic outlook, with sentiment dropping below 100 for the first time since the survey’s inception, to 81.6. The index is up slightly in the remaining three sectors measured: transportation/warehousing, construction and manufacturing. “It stands to reason that sentiment would be down in the oil and gas sector, given the winter’s discouraging energy prices. What’s more surprising, perhaps, is that prices haven’t triggered a broader fall in sentiment,” Hirsch said. Ted Chambers, a Research Professor at the Western Centre for Economic Research, said the flatlined sentiments index suggests that economic conditions in the short term are not likely to improve or worsen. “The bottom line is little if any immediate change from recessionary conditions,” Chambers said. In the medium term, survey results suggest that more Alberta businesses expect their outputs to grow than shrink over the next 12 months. Some 25 per cent expected their outputs to decrease, 31 per cent said they will stay the same, 23 per cent said outputs will grow by less than 10 per cent and 21 per cent said they’ll grow by more than 10 per cent. The complete report also contains data regarding businesses’ actual activity in the previous quarter – down dramatically in oil and gas and manufacturing – and their hiring intentions. The report is available at www.business.ualberta.ca/wcer The next ATB Financial Business Sentiments Index™ report will be released on June 18, 2009. About ATB Financial – ATB Financial is the largest Alberta-based financial institution, with assets of $25.7 billion. It provides Personal and Business Financial Services, Investor Services, and Corporate Financial Services to more than 660,000 Albertans in 244 communities. It provides service through 163 branches and 133 agencies, telephone and Internet banking, a Customer Contact Centre, and Automated Banking Machines. ATB Financial was established in 1938 and has been a provincial Crown corporation since 1997. It was recently named one of Canada’s 50 Best Employers by Report on Business Magazine.
About the Western Centre for Economic Research – The WCER is an applied research centre within the University of Alberta School of Business. The centre monitors the performance of Western Canada's economy, its policies and programs, and implications for business enterprises. Drawing on a wide range of expertise, recent work of the WCER has included analyses of the Alberta resource economy, Western Canadian international trade, the effects of free trade agreements, barriers to trade and the role of small business in the West. For further information please contact: Todd Hirsch Jason Brisbois |
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