Our region’s private sector is generally underperforming the rest of the country, according to a new study by the Fraser Institute.
The State of Markets in Atlantic Canada looked at five measures to assess how our region’s private sector, or markets, is performing.
They include private sector business investment per worker, the size of the government sector, business starts, private sector employment, and venture capital.
“For most of recent history, there has been a prosperity gap between Atlantic Canada and the rest of Canada, and part of closing this gap is for the region to have a healthy private sector,” said co-author Alex Whalen, who is also a policy analyst at the Fraser Institue.
Nova Scotia was last among all provinces in private sector investment in 2019, spending $11,300 per worker. Prince Edward Island was ninth ($11,400) and New Brunswick was eighth ($13,800). The national average was $21,300.
The study found government spending at all levels as a share of the economy was highest in the three Maritime provinces. Nova Scotia led the pack (60.2 per cent), followed by P.E.I. (58.5 per cent) and New Brunswick (57.4 per cent).
When it comes to small business start-ups, which the think-tank said is a key measure of entrepreneurship, New Brunswick ranked ninth at 117 new entries per 1,000 businesses, while Nova Scotia was seventh at 123.
Prince Edward Island, however, led the country in the new business entry rate in 2019 at 166 new entries per 1,000 businesses.
All four Atlantic provinces had below-average shares of private-sector employment as a share of total employment in 2019, with New Brunswick ranking fifth at 64 per cent, Nova Scotia sixth at 63.6 per cent, and P.E.I. ninth at 59.7 per cent.
Nova Scotia ranked fifth in Canada for private venture capital investment at $51.37 per person while New Brunswick ranked eighth at just $1.51 per person. P.E.I. did not disclose any private-sector venture capital investments in 2019.
“Improving the state of private markets in Atlantic Canada should be a key concern for policymakers and the general public as the region aspires to close its prosperity gap with the rest of Canada,” said the report.
You can view the report in full by clicking here.
