A message from Mark Parsons at ATB Economics:
Alberta’s economy was gaining momentum when escalating trade tensions significantly altered the economic landscape.
Our new Alberta Economic Outlook forecasts a period of slower growth and an increased unemployment rate due to heightened uncertainty amid President Trump’s tariff threats. Leading indicators on sentiment point to a pullback in business investment and consumer spending.
Alberta’s real GDP is now forecast to grow by 1.5% in 2025 and 1.9% in 2026, with the unemployment rate averaging 7.6% this year. Despite the challenges, Alberta is projected to outperform the rest of Canada, which is expected to grow at only 0.6% this year.
Given the unprecedented level of policy uncertainty, the Outlook includes alternate economic scenarios: A pessimistic tariff scenario in which growth slows to only 0.5% in 2025 and 1.3% in 2026, and an optimistic tariff scenario in which growth picks up to 2.7% in 2025 and 2.4% in 2026.
Alberta’s energy sector, supported by strong balance sheets and access to new Asian markets, is anticipated to continue expanding despite tariff headwinds. Tourism is also expected to be a bright spot, driven by a weaker Canadian dollar and increased domestic travel. Continued gains from interprovincial migration will provide an uplift to housing and consumer spending.
The current trade environment has served as a wake-up call, highlighting the need to address long-standing economic challenges in Canada such as interprovincial trade barriers, getting major projects built, and diversification into new export markets.
While the trade war will undoubtedly cause economic strain, the Alberta economy has demonstrated resilience in the past and is expected to navigate through this period of uncertainty.
For a deeper understanding, take a look at the Alberta Economic Outlook released on March 20.
For more number-crunching on Alberta’s economy, visit The Twenty-Four Seven by ATB.