Business

Winnipeg Free Press - PRINT EDITION

Manitobans live in hope

Poll finds we're confident about economic future

By: Murray McNeill

Posted: 10/26/2010 1:00 AM | Comments: 0 (including replies)

WAYNE.GLOWACKI@FREEPRESS.MB.CA Enlarge Image

Tom Payne Jr., president of the Manitoba Trucking Association, says shipments to Canada from the U.S. are on the rebound. He expects they will continue to grow into 2011 and 2012.

Manitobans are bullish about the local and national economies, but local officials say things may not be so rosy.

A new Free Press/Jory Capital poll by Probe Research found that 80 per cent of Manitobans are optimistic about Canada's economy, and nearly as many -- 77 per cent -- are feeling good about the local economy, too.

Numbers game

80 -- percentage of Manitobans who say they're optimistic about Canada's economic future.

77 -- percentage who are optimistic about the economic future of their local economy.

81 -- percentage of Winnipeggers who are optimistic about Winnipeg's economic prospects.

72 -- percentage of rural Manitobans who are upbeat about the prospects in their local community.

60 -- percentage who say their personal financial situation hasn't changed significantly over the past 12 months.

34 -- percentage of Manitobans who expect to be better off financially a year from now.

37 -- the percentage that thought that way in the three previous quarterly surveys.

14 -- the percentage who say they're worried they or a family member may lose their jobs, versus 15 per cent in the previous survey in June.

-- Source: Probe Research

But Jory Capital CEO Patrick Cooney and University of Manitoba economics Prof. John McCallum said there is plenty of cause for concern.

They said consumer and government debt are way too high, interest rates have nowhere to go but up, some European countries are in financial crisis, and the U.S. economy is slow in recovering from the global recession.

For evidence of that, and the negative impact that can have on the Manitoba economy, you have to look no further than the local trucking industry. When Manitoba truckers are hauling lots of goods south of the border, that means local factories are humming and manufacturing jobs are plentiful. And when they're not, manufacturers usually are suffering, which is why 8,000 to 9,000 factory jobs were cut in the province during the recession.

Industry officials said Monday while shipments to the U.S. are better than they were in 2009, they're still nowhere near pre-recession levels.

Jeff Pries, vice-president of sales for Bison Transport, said although there are plenty of goods being shipped north to Canada, Bison is still having trouble finding enough goods to fill its southbound trailers. "I am optimistic," Pries said. "But it's too early to say we're completely out of the dark and out of the challenges."

Manitoba Trucking Association president Tom Payne Jr. also said while the increase in northbound shipments is allowing truckers to charge more for those trips, they're being pressured to reduce their rates on southbound trips because of the reduced volumes there.

Like Pries, Payne said he's optimistic the U.S. economy and the demand for Canadian goods will rebound. But he expects it will be next year before there's any big improvement. "Definitely 2011 is what my company (Payne Transportation Inc.) and many in our industry are focusing on and building towards. We believe it will be pretty strong in 2011 and 2012."

Because of the economic uncertainty, McCallum and Cooney say now is not the time for Manitobans to start racking up more debt, even if they're feeling optimistic. Instead, they should be doing the opposite.

"Optimism is a good thing, but it should be tempered a little bit," Cooney said. "Let's not be delusional about what's going on in the economy and let's change the way we look at debt. If we're leveraging too much, it's a bad thing."

McCallum noted exports to the U.S. account for one-third of Canada's annual gross domestic product (GDP).

"When they're sputtering, and they are sputtering, that is bad for our economic growth, bad for our standard of living and bad for our job growth," he said. "So if you've got an awful lot of debt, don't add to it. And if you've got an awful lot of debt and have the capacity to pay back some of it, that's a good idea."

Cooney said he was alarmed by a TD Economics report last week that said household debt is rising faster in Canada than in the U.S., and that one in 10 Canadian households is at risk of being unable to meet its financial obligations when interest rates rise.

"We've seen what happened in the U.S. (when consumer debt became too high)," he said, "but for some reason there is a disconnect here."

Curtis Brown, a research associate with Probe Research, attributed the high consumer confidence levels here to the fact the Manitoba and Canadian economies both weathered last year's recession better than others.

"The Canadian economy, on the whole, seems to have righted itself," he said, "and I think that's why you get a fair bit of optimism."

The latest survey also showed consumer confidence is higher in Winnipeg than in rural Manitoba. Eighty-one per cent of Winnipeg respondents said they were optimistic about the city's economic future, while only 72 per cent of rural Manitoba respondents said they were optimistic.

"It really was a pretty brutal year in some parts of rural Manitoba for farmers," Brown said.

The random poll of 1,002 adult Manitobans was conducted between Sept. 16 and Sept. 30. The results are considered accurate 95 per cent of the time, with a margin of error of plus or minus 3.1 per cent.

murray.mcneill@freepress.mb.ca

Republished from the Winnipeg Free Press print edition October 26, 2010 B6

(You must be logged in to post your reaction)

Your reaction?

More Business

Undock

You can comment on most stories on winnipegfreepress.com. You can also agree or disagree with other comments. All you need to do is register and/or login and you can join the conversation and give your feedback.

The Winnipeg Free Press does not necessarily endorse any of the views posted. By submitting your comment, you agree to our Terms and Conditions. These terms were revised effective April 16, 2010; View the changes. New to commenting? Check out our Frequently Asked Questions.