We have our first estimate of how much money will be devoted to capital spending in this province this year.
This particular indicator has become significant to economy watchers as something of a bellwether. It was the factor that drove Saskatchewan’s boom a few years ago when capital investment flowed into mines, the oil patch, commercial development and infrastructure. It triggered job creation and generated plenty of commercial activity.
The outlook for this year is slightly lower than what we saw in 2018.
But first, here’s some context. Twenty years ago, Saskatchewan consistently saw about $7 billion in capital investment annually. That rose to roughly $20 billion at the peak of the boom. And since then it has been gradually declining. Last year, $15.3 billion went into non-residential construction, plant, equipment and machinery.
The forecast for this year – drawn from interviews with major organizations across the province – is $14.8 billion, which is a pullback of roughly 3.5 per cent. All the reduction is in the non-residential construction category as investment in equipment and technology is going to increase this year.