Zata Blog

Study: A review of retail trade in the provinces
2006

Canada’s retailers had their busiest year in nearly a decade in 2006, and it was consumers in the three westernmost provinces who increased their spending the most, according to a new study.

Retailers sold $389.6 billion worth of goods and services in 2006, up 6.4% from 2005, the highest rate of growth in nine years. When price changes were taken into account, retail sales increased by 5.3%.

The study, published in the Analysis in Brief series, examined the retail trade industry on a provincial and territorial level in 2006 using data from the Monthly Retail Trade Survey.

The study showed that retail trade increased Canada-wide in 2006. Among the provinces, only three had rates of growth above the national average: Alberta, British Columbia and Saskatchewan.

Consumers in Alberta led the pack with a stellar 15.6% increase in retail spending, a bigger boost than their own impressive 11.8% increase in 2005. It was the third year in a row that Alberta’s growth rate was the highest in the country.

Some of the factors behind Alberta’s historic high include a 7.5% increase in its average weekly wage rate and 4.8% employment growth. Both rates were the highest among the provinces and territories. Alberta’s 3.4% unemployment rate was also the lowest in Canada.

The increase in British Columbia was the province’s best since 1995, while resource-rich Saskatchewan experienced a retail sales boom to rival the national average.

In Manitoba, sales growth fell short of the national average, the result of wide differences in growth rates among the various trade groups in the province.

Retail sales growth also fell below the national average in Quebec, even though the increase in spending in the province’s pharmacies and personal care stores was the highest in the country.

Ontario’s rate of retail growth again lagged behind the national average. In fact, Ontario’s share of national retail sales has declined for six straight years, and was lower in 2006 than a decade earlier.

Nova Scotia posted the strongest retail growth among the four Atlantic provinces. The retail growth rate in New Brunswick hit a seven-year high, while in Prince Edward Island it reached a six-year high. Sales in Newfoundland and Labrador improved after two years of weak growth.

At the national level, double-digit growth rates were posted by 4 of the 18 retail trade groups last year. Home furnishing stores led the pack in 2006, with a growth rate of 13.9%. This group was followed by used and recreational motor vehicle and parts dealers (+13.6%), home centres and hardware stores (+10.5%) and pharmacies and personal care stores (+10.3%).

The 13.6% increase in sales at used and recreational motor vehicle and parts dealers was more than twice the 5.1% rate of growth in 2005. It represented the group’s strongest growth rate since 1994 and was driven by strong sales of recreational vehicles.

Source: Stats Can