Vancouver, B.C. – The Business Council of British Columbia (BCBC) has released its last B.C. Economic Review and Outlook of the year. While B.C.’s economy is weak by historical standards, it has still bested the rest of Canada in recent years. B.C.’s outperformance reflects the impact of mega capital projects – Trans Mountain, Site C, LNG Canada, and Coastal Gas Link – along with very high levels of government spending and public sector hiring. In contrast, private sector investment and hiring remain weak.

Key Findings

Now that provincial mega projects are complete, BCBC expects B.C.’s economic performance will align more closely with the rest of Canada. Topline GDP growth is expected to be around one per cent in 2024 rising to 1.8 per cent in 2026 – a modest pace by historical standards, which are closer to 2.5 per cent.

B.C.’s GDP per capita – a key metric of overall living standards – fell outright in 2023 and 2024. However, it should start to grow again in 2025 and 2026 as population growth slows (mostly through temporary immigrants exiting the country) and labour productivity improves.

Having changed the level and composition of immigration in recent years, the federal government now plans to reverse course. Both Canada and B.C.’s population growth will slow, which should gradually alleviate pressures on housing, infrastructure, health, and other services.

“On a population adjusted basis, Canada’s economy has been one of the worst performing out of the 38 advanced OECD countries and seen little or no growth for a decade. B.C. has done slightly better, owing to the lift from mega capital projects and very high government spending. The projects are now completed, and current levels of government spending aren’t sustainable, so it’s not clear what will drive future prosperity.” says David Williams, BCBC’s Vice President of Policy.

The Business Council urges policymakers to focus on improving the competitiveness of B.C.’s tax and regulatory environment relative to other jurisdictions. A more vibrant private sector economy is key to raising living standards in the province over time. BCBC also reiterates its call (see here) for the government to place the province’s finances on a more sustainable footing.

The Road Ahead

Once driven by major capital projects, B.C. now faces an economic plateau. With no large projects on the horizon, B.C.'s economic outlook remains uncertain. While service exports like professional services and tourism are growing, these gains are offset by losses in forestry and manufacturing.

“Where will B.C.’s economic growth come from is the question we’re asking,” said report co-author Ken Peacock, BCBC’s Senior Vice President and Chief Economist. “We need a stronger private sector, but unfortunately investment and hiring in B.C.’s private sector appear weak.”

Today’s report stresses the need for swift action to avoid stagnation. As Canada’s trade relationships become more volatile, particularly with U.S. policies, B.C. must reassess its economic strategies.

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Media Contact

Braden McMillan
Director of Communications
braden.mcmillan@bcbc.com

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