Employment recovery lagged other provinces, but picked up in late 2021. A November–December surge in manufacturing hiring anchored gains, while summertime year-over-year spikes in accommodation and food services jobs—likely due to recovering tourism activity—also offered a boost. With relatively modest pandemic restrictions, that momentum should help PEI consumer spending in 2022.
Housing market activity looks to be slowing. In 2021, PEI residential building construction growth exceeded that of all other provinces; however, it cooled in H2 and home sales and price gains consistently lagged the national average last year. This provides a soft handoff for 2022, though continued immigrant attraction should support household formation and residential investment over the long term.
US potato export ban raises uncertainty about trade outlook. The Canadian Food Inspection Agency’s recent national survey reported no wart fungus in seed potatoes in fields not regulated by Ottawa, which should reassure Washington. However, the ban remained in place at the time of writing. We suspect that there will be a catchup effect later in the year if the ban is lifted.
Infrastructure budget increased again. The plan released in October 2021 bolstered FY22 outlays (chart 1), and the 9% rate of decline scheduled for FY23 is far softer than anticipated in the prior blueprint. These represent solid efforts to meet the needs of PEI’s growing population. The Island had the lowest capital stock per worker of any province last year.
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