Albertans seeking greener pastures both west and east

Special to The Globe and Mail
Published Friday, September 23, 2016

What motivates interprovincial migration in Canada? Are people drawn to a new region by a perceived better quality of life? Or are they simply fleeing economic hardship and moving to where the jobs are?

While it’s difficult to generalize across all regions of the country, out-migration from Alberta shows that it’s a bit complicated. Sometimes migrants are pushed out, but sometimes they are pulled away.

In the most recent snapshot of interprovincial migration, Alberta is now seeing a net loss of migrants to both Ontario and British Columbia. Combined, these two provinces are the destination of nearly two-thirds of people leaving Alberta. That reverses a powerful trend of in-migration over the period 2010 to 2014. With the petroleum sector in a nasty slump and the province now stuck in a second year of recession, it’s neither surprising nor unexpected that more Albertans are leaving than arriving.

The graph above shows total out-migration from Alberta to Ontario and B.C. over the past 40 years. (The graph does not show net migration, which would show that in-migration to Alberta has generally outpaced out-migration). What stands out in the graph is that while there are occasional surges of out-migration to both provinces, the surges are not concurrent. That suggests the reasons Albertans move to B.C. are different than the reasons they move to Ontario. Out-migration from Alberta to B.C. swelled to nearly 8,000 per quarter in 1979 and 1980, and again in the early 1990s (see graph). These were years when Alberta’s economy was actually performing reasonably well – the unemployment rate in 1980 was a mere 3.9 per cent. In 1990, it was 6.9 per cent, which is high for Alberta but lower than B.C.’s rate of 8.4 that year.

There was another wave of out-migration from Alberta to B.C. in 2007. Labour markets in both provinces were doing well, but Alberta was still the stronger market. In that year, Alberta’s white-hot economy actually saw severe labour shortages; the unemployment rate was 3.6 per cent. Still, people kept moving to B.C.
This suggests that lifestyle, not economics, prompts Albertans to move to B.C. The mild climate on the coast, the hot, dry summers in the interior and the recreational opportunities throughout the province make it very attractive. There’s a reason why people retire to British Columbia.

Ontario, on the other hand, tends to be the destination of migrants who may simply be out of work opportunities. Massive waves of migrants moved from Alberta to Ontario during the downturns of 1984 and 1986, when Alberta’s unemployment rate was a miserable 11.4 per cent and 10 per cent, respectively. That stands in sharp contrast to Ontario’s economy, which was ramping up. Riding a wave of well-paying manufacturing jobs, its unemployment rate fell to a low of 5 per cent in the late eighties.

The pattern that emerges is one showing there are different reasons for out-migration from Alberta. British Columbia tends to draw people, regardless of economic conditions. Ontario, on the other hand, tends to receive those pushed out of a lousy job market.

Currently, both provinces are seeing rising migration from Alberta – a rare instance when the cycles are in sync. With the highest unemployment west of New Brunswick, Alberta’s tough economy is unfortunately driving some job seekers out of the province. Ontario’s economic growth is easily outperforming Alberta’s this year, but it’s hardly booming. The province’s unemployment rate is still near 6.5 per cent. That’s why there has been a rise, but not yet a massive tsunami, of migration from Alberta to Ontario. The opportunities in the latter are simply not all that much better.

British Columbia, on the other hand, is enjoying its day in the economic sun. With the strongest labour market in the country and an economy fuelled by offshore investment, B.C. is by far the preferred destination of job seekers from Alberta. Not only does the province offer plenty of jobs, there are daffodils in February in Stanley Park.

Indeed, if it wasn’t for the unattainable cost of real estate in the lower mainland, out-migration from Alberta might be higher still.
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Todd Hirsch is the Calgary-based chief economist of ATB Financial and author of The Boiling Frog Dilemma: Saving Canada from Economic Decline