New Brunswick's Economy: Opportunities And Challenges

New Brunswick, a Canadian province on the East Coast, has a varied economy, with significant contributions from agriculture, forestry, food processing, freight transport, media, oil, and shipbuilding. The province's economic landscape is largely controlled by the Irving Group of Companies, with interests spanning various sectors. New Brunswick's strategic location in Atlantic Canada and its bilingual workforce make it an attractive expansion hub. The province boasts a skilled and motivated workforce, world-class communication infrastructure, and a competitive corporate tax structure.

New Brunswick's GDP in 2002 was derived from services (43%), construction, manufacturing, and utilities (24%), real estate rental (12%), wholesale and retail (11%), and sectors like agriculture, forestry, and mining (5%). The services-producing sector employed 280,900 people as of October 2017, with many working in social assistance, trades, and healthcare.

While New Brunswick offers abundant job opportunities, it has faced economic challenges, including consecutive deficit budgets and a shrinking tax base. The province has the lowest median household income in Canada and saw a population decline between 2011 and 2016. However, it remains an attractive destination for investors and immigrants, offering a high quality of life and a low cost of doing business.

The province's economic history

New Brunswick, a province in Canada, has had a varied economic history. Initially, the French claimed the province, then known as Acadia, before the British took over in 1713. The French defended the maritime province but were defeated in the 1750s, and in 1755, most French Acadian settlers were expelled from the area.

In the early 1800s, New Brunswick prospered and the population grew rapidly. In 1848, responsible home government was granted, and the 1850s saw the emergence of political parties largely organised along religious and ethnic lines. The economy started showing significant improvement with the development of the timber exports and shipbuilding industry. New Brunswick featured tremendous agricultural lands and luscious forests, which became the ideal vessel for carrying through the age of wood, wind, and water—an era that served as the lifeblood of the New Brunswick economy.

From the mid-1900s onwards, however, New Brunswick was one of the poorest regions of Canada, mitigated only by transfer payments. The economy began to improve towards the early 20th century, with the railways and tariffs fostering the growth of new industries in the province, such as textile manufacturing, iron mills, pulp and paper mills, and sugar refineries.

Today, the economy relies mainly on the production of food products, paper, and wood products. Additionally, there is a growing IT sector in several cities in New Brunswick. The province is big on manufacturing metal goods, mineral products, and machinery, and Canada's largest oil refinery, located at Saint John, has grown exponentially due to increased demand throughout North America.

The role of the Irving Group of Companies

The Irving Group of Companies, founded by the Irving family, is a powerful corporate concentration of large companies in New Brunswick. The Irving family, descendants of Canadian industrialist K.C. Irving, owns many companies that supply each other from different steps in the chain of production. These companies largely fall under four umbrellas: J.D. Irving Limited, Brunswick News, Irving Oil, and Ocean Capital Holdings. The Irving Group has significant holdings in agriculture, forestry, food processing, freight transport (including railways and trucking), media, oil, and shipbuilding.

The Irving Group's activities are supported by the authorities through numerous tax exemptions and the payment of subsidies. The group's media outlets, including newspapers and radio stations, have been criticised for their journalistic integrity, particularly when reporting on companies controlled by the Irving family. The concentration of media ownership has led to allegations of collusion and biased reporting, with a Senate committee expressing concerns about the family's near-monopoly over the province's print media.

The Irving Group has a history of environmental contamination, with Irving-owned facilities emitting a mixture of carcinogens, including benzene and lead. In recent years, Irving Pulp and Paper Ltd. has been fined multiple times for pollution and added to the federal government's Environmental Offenders Registry.

The Irving Group's influence in New Brunswick is such that the province is sometimes described as being subject to a form of economic feudalism. The group has been accused of erecting barriers to entry that suppress competition and innovation. The family's wealth and power have also been linked to political patronage, with every premier in the province since the 1970s being elected with their support.

Overall, the Irving Group of Companies plays a significant role in New Brunswick's economy, controlling a large portion of the province's key industries and exerting influence over its political and media landscape.

Employment and labour force

Labour Force Participation

New Brunswick has a population of approximately 775,610 people as of the 2021 census, with about half living in urban centres such as Moncton, Saint John, and Fredericton. The province has a lower population density than the rest of the Maritimes and is about 83% forested.

The labour force participation rate in New Brunswick has faced challenges, with nearly 5,000 people leaving the workforce in 2017. The province has an aging population and is one of the oldest in Canada. This has resulted in a shrinking labour force and a transition towards more public sector employment.

Employment Sectors

The economy of New Brunswick relies on various sectors, including:

• Services: The service sector contributes significantly to the economy, accounting for about 43% of the provincial GDP in 2002. This includes government services and public administration, social assistance, trades, and healthcare.
• Agriculture and Food Production: New Brunswick has a strong agricultural sector, with products like potatoes, apples, cranberries, maple syrup, and livestock. McCain Foods, a major manufacturer of frozen potato products, is based in the province. The food production industry also includes seafood, with lobster being a significant export.
• Forestry and Natural Resources: With extensive forests, the forestry and natural resource sectors are vital. The industry employs nearly 12,000 people and generates around $437 million in revenue. This includes pulp and paper production, as well as mining, which has grown in recent decades.
• Manufacturing and Construction: Manufacturing and construction contribute to the economy, with the former making up 24% of GDP in 2002. This includes the production of metal goods, mineral products, machinery, and wood products.
• Tourism: Tourism is a significant contributor to the economy, accounting for about 9% of the labour force. Popular destinations include Fundy National Park, Hopewell Rocks, Kouchibouguac National Park, and Roosevelt Campobello International Park.
• Retail and Small-Scale Manufacturing: New Brunswick offers opportunities in retail trade and small-scale manufacturing, particularly in forestry, agriculture, and tourism-related industries.
• Information Technology (IT): There is a growing IT sector in several cities, benefiting from the province's bilingual workforce.
• Oil and Energy: The province is home to Canada's largest oil refinery in Saint John, which has grown due to increased demand in North America.

Income and Employment Opportunities

New Brunswick has the lowest median household income in Canada, and its economy has been described as "poor." The province has faced consecutive deficit budgets and struggling industries, such as shipbuilding and timber exports, which have declined over time. However, there are efforts to attract investment and skilled workers through programs like the New Brunswick Provincial Nominee Program (NBPNP).

The average salary in New Brunswick can start from CAD 33,150 per year, with entry-level positions offering around CAD 29,250. Experienced workers can earn up to CAD 49,653 annually. The province offers competitive advantages, such as a low cost of doing business, a skilled workforce, and a favourable corporate tax structure.

In summary, employment and labour force dynamics in New Brunswick are shaped by the province's natural resources, bilingual workforce, and economic challenges. The province offers diverse job opportunities across various sectors, ranging from natural resources to IT and entrepreneurship.

Industries and exports

New Brunswick's economy is diverse and resilient, with a range of industries contributing to its growth and development. The province's strategic location and transportation infrastructure make it an attractive destination for businesses looking to expand their operations in the Atlantic region.

New Brunswick has a strong primary sector, with a large number of residents employed in agriculture, forestry, fishing, hunting, mining, oil, and gas extraction.

Agriculture

The agricultural sector in New Brunswick is well-established, with a highly skilled workforce and expertise that has been passed down for generations. The province is known for its farming, forestry, and fisheries, and it has the value chain to support these industries. McCain Foods, one of the world's largest manufacturers of frozen potato products, is based in the province. In 2015, New Brunswick was also the biggest producer of wild blueberries in Canada. The value of the livestock sector is about a quarter of a billion dollars, with nearly half coming from dairy. Other sectors include poultry, fur, goats, sheep, and pigs.

Forestry

About 85 to 90% of New Brunswick is forested. Forestry accounted for more than 80% of exports in the mid-1800s, but the industry declined towards the end of that century due to external economic factors. Forestry practices have evolved from controlled harvests to the cultivation of forests. The industry employs nearly 12,000 people and generates around $437 million in revenue.

Fishing

New Brunswick is one of the four Atlantic provinces on Canada's East Coast and has a strong fishing industry. Seafood products are a significant export, with lobster making up about half of the exports to the United States. Other products include salmon, crab, and herring.

Mining and Quarrying

Mining was historically unimportant in New Brunswick but has grown since the 1950s. The province's GDP from mining and quarrying was $299.5 million in 2015. Mines in the province produce lead, zinc, copper, and potash.

Energy and Utilities

New Brunswick has a growing energy sector, with the government investing in the development of sustainable energy solutions. The Belledune Port Authority, for example, aims to become the province's first green energy hub with plans to install wind and solar power infrastructure.

Manufacturing

The manufacturing sector in New Brunswick is advanced and characterised by the use of innovative technologies such as automation, artificial intelligence, and 3D printing. Irving Oil, a family-owned energy company, operates the largest refinery in Canada, located in Saint John, New Brunswick. The province also has a strong presence in the aerospace, defence, biotechnology, and pharmaceutical industries.

Information and Communications Technology (ICT)

The ICT sector in New Brunswick is thriving and is one of the largest sectors in the province, employing over 30,000 people. The sector includes software development, data analytics, digital media, telecommunications, and information technology consulting.

Tourism

Tourism is another important industry in New Brunswick, accounting for about 9% of the labour force directly or indirectly. Popular destinations include Fundy National Park, the Hopewell Rocks, Kouchibouguac National Park, and Roosevelt Campobello International Park. In 2013, 64 cruise ships called at the Port of Saint John, carrying an average of 2,600 passengers each.

Cost of living

The cost of living in New Brunswick is considered low compared to other provinces in Canada, making it an attractive option for those looking to relocate. The province offers affordable housing, with the average price of a house around $155,000. Utilities such as water, gas, electricity, heating, and power are also significantly lower than in the rest of Canada. Additionally, the cost of food and groceries is generally in line with the Canadian average, and healthcare is free for all permanent residents and citizens.

When it comes to specific expenses, here are some estimates for various costs in New Brunswick:

• A meal at an inexpensive restaurant: $15
• A meal for two at a mid-range restaurant: $50-$80
• Domestic beer (0.5-liter draught): $4-$6
• Imported beer (0.33-liter bottle): $6-$9
• Cappuccino: $4-$6
• Coke/Pepsi (0.33-liter bottle): $1.50-$2
• Water (1.5-liter bottle): $1.50-$2
• Milk (regular, 1 liter): $1.50-$2
• Loaf of fresh white bread (500g): $2-$3
• Chicken fillets (1kg): $10-$15
• Beef round (1kg): $10-$15
• Bottle of wine (mid-range): $10-$15
• Domestic beer (0.5-liter bottle): $2-$3
• Cigarettes (pack of 20): $13
• One-way ticket for local transport: $2.50-$3
• Monthly public transport pass: $50-$70
• Basic utilities (electricity, heating, cooling, water, garbage) for an 85m2 apartment: $100-$150
• Internet (60 Mbps or more, unlimited data, cable/ADSL): $50-$70
• Mobile phone plan with calls and 10GB+ data: $40-$60
• Fitness club membership (monthly): $30-$50
• Cinema ticket (international release): $10-$12

Rent in New Brunswick is generally cheaper than in many other cities, with prices varying depending on the location and type of accommodation. Here are some estimates for monthly rent:

• Bachelor/studio apartment in Moncton: $607-$700
• One-bedroom apartment in Moncton: $698-$930
• Bachelor/studio apartment in Fredericton: $637-$755
• One-bedroom apartment in Fredericton: $747-$755
• Bachelor/studio apartment in Saint John: $526-$548
• One-bedroom apartment in Saint John: $648-$745

Overall, New Brunswick offers a low cost of living, making it an attractive destination for individuals and families looking for an affordable place to live in Canada.

Frequently asked questions