Alberta’s business leaders positive about a Conservative majority government: PwC’s May 2011 Business & Consumer Confidence Indices

Consumers aren’t as sure – 56% positive, close to one-third neutral

CALGARY, June 1, 2010— 200 of Alberta’s business leaders indicated a renewed sense of optimism in May 2011 with increases in both the current and future business conditions results of PwC’s Business and Consumer Indices, produced in conjunction with Leger Marketing.

Ian Gunn, Leader of PwC’s Private Company Services practice in Alberta said, “The overall confidence level and outlook for the future of the economy remains strong and is supported by the findings of PwC’s recent survey of business leaders. The confirmation of a majority government that will provide stability in the near term has been cited by a number of our clients as the reason why they remain confident in Alberta’s economy.”

According to business leaders, a Conservative majority in the House of Commons will have an overall positive impact on Alberta (69% say they are either very or somewhat positive, 23% feel neutral, with only 5% negative).

• They also feel that a federal conservative majority is likely to lead to lower corporate taxes (52%), more employment opportunities (52%) and more privatization of healthcare (47%) in Alberta.
• There is anticipated to be decreased likelihood of lower personal taxes (20%) and higher commodity prices (27%).

However Albertans themselves aren’t so sure. Overall, consumers are relatively less positive regarding the impact of a federal conservative majority on the province (56% are positive) and close to one-third of Albertans are neutral about the possible impact on Alberta. Of the 900 consumers surveyed:

• Albertans anticipate that a federal conservative majority will lead to more job opportunities in Alberta (64%); however, they also predict higher commodity prices (53%).
• A lower proportion feel there could be fewer environmental regulations (31%) or lower personal taxes (29%).

Consumers’ optimism about the job market increased in May as indicated by the future unemployment index (growing from 110 in Nov 2010 to 124 in May 2011). The future unemployment index has also gradually increased since July 2010. The outlook for home purchasing was unable to sustain its temporary recovery as demonstrated by the decrease to 131 in May 2011 following increases in the previous two periods (125 in November 2010, 130 in Jan 2011, 134 in Mar 2011).

Both business leaders and consumers continue to anticipate a possible increase in interest rates with a steady decline in the interest rate index (dropping from 56 in Nov 2010 to just 30 in May 2011 according to business leaders).

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