Nunavut’s economy looks strong for 2015: report

An Agnico Eagle geologist unloads supplies at the company’s Amaruq exploration site, where work is expected to ramp up in 2015. (AGNICO EAGLE PHOTO)

Your holidays may look merry and bright, and now so does Nunavut’s economic outlook for the upcoming year.

A new forecast published by the Conference Board of Canada’s Centre for the North predicts that the Nunavut’s economy will grow by 6.8 per cent in 2015, thanks to a number of mining projects moving into both construction and production.

That’s big growth compared to 2014, when the Centre for the North forecasted just 1.9 per cent growth.

Mining continues to be the major driver behind Nunavut’s private sector and employment:

• In 2014, Agnico Eagle Mines’ Meadowbank mine in the Kivalliq is set to exceed its 2013 production. And this past fall, the company reported promising results from a new project located about 50 kilometres from the mine site, called Amaruq, which will undergo expanded exploration in 2015.

• Baffinland’s Mary River iron ore mine has moved into production is expected to significantly boost the territory’s mining output in 2015, with the anticipated of more than four million tonnes of iron ore. Baffinland also plans to further develop the property and its port infrastructure at nearby Milne Inlet, where ore will begin to be shipped in the 2015 open water season.

• The Nunavut Impact Review Board recommended in 2014 that the federal government approve Agnico Eagle’s proposed Meliadine gold mine, subject to certain conditions. The company will likely make a decision on whether to move ahead with the construction of a mine there in 2015.

• The construction industry in Nunavut will enter its busiest year yet in 2015, with expected growth of 36 per cent, the Centre for the North predicts.

The industry’s biggest boost should come from work at the Mary River mine and port sites; Baffinland plans to invest some $740 million into mine and transportation infrastructure between now and 2016.

That will create a significant number of jobs, but how Nunavummiut benefit remains to be seen: only about 40 per cent of construction jobs are filled by workers from within the territory.

• The public sector also has a number of projects under development, including the $143 million Canadian High Arctic Research Station in Cambridge Bay and the $300 million Iqaluit airport upgrade.

• Nunavut’s waters provide a small but growing segment of the territory’s economy though its fishing industry, the majority of which is based in the Baffin region. The inshore industry in Cumberland Sound pulled in a record 300 tonnes of turbot last winter.

But the Centre for the North outlook notes that an expansion of fish quotas and the development of local infrastructure will be vital to the industry’s future.

While the territory’s economy grows in 2015, so will its population and as a result, the demand for goods and services.

As other economists have pointed out, Nunavut’s high birth rate has created a situation where there are not enough working adults to support the children and youth in the territory.

The report notes, though, that Nunavut is the only province or territory in Canada where the fertility rate sits above the replacement rate, meaning it will continue to have a young and growing labour force.

Unemployment in Nunavut has been falling over the last few years, from 16.5 per cent to 13.5 per cent in 2013.

The Centre for the North report forecasts that rate dipping to 11.7 in 2015 and remaining steady until 2018.