Key takeaways from new report on P.E.I.'s economy

Chambers of Commerce from across Prince Edward Island have come together once again to take a closer look at the island's economy. The goal of Project Island Report is to provide islanders with a trusted source to inform decisions and shape policy and to help the province prepare for the future. They released the report just hours ago. David Campbell is an economist. He led the study and Ben Parsons is the co-chair of the PEI Business Economic Council and they both join me now in studio. Good evening. It's good to be here. Well, David, let's start with you. What are the big takeaways? Well, we took a look at a lot of data. We looked at dozens and dozens of data points from the economy to the workforce to the population to income. And I think what we came away with is that the island economy is still quite strong, but there are some sort of warning signs or some red flags in the data that would suggest that the future might be a little more challenging and so there's some potential policies prescriptions there but for example the GDP growth which is the overall measure of the state of the economy was second best in the country only behind Newfoundland and Labrador but population growth slowed substantially uh in 2025 and looks like it's going to slow again in 2026 and of course much of the island's growth in the past 15 years has been benefited from the population growth. And I know there's lots of, you know, concerns around population growth here in PEI, but I think we have to have a conversation about it because ultimately population growth, given our demographic situation, is very, very important. Every year on the island, more people die than are born. And that's not uncommon, and, you know, that's the case elsewhere in Atlantic Canada. But we have to be thinking about bringing in people, moving here, young families, to offset that. Yeah, I'm curious. We've obviously seen a shift both by the federal and provincial governments to pull back immigration, which obviously is one of the big drivers of PEI's population. Does that mean that was a mistake? No, not necessarily. I think we had to look at what was happening. If you look at the numbers nationally, you know, we did see a huge surge in what's called temporary residents. and those are people here studying and people here on what are called postgraduate work permits and things like that so i think there had to be a rationalization of some of that and a better more strategic approach to immigration but the problem is you sort of apply it nationally and everybody gets cut and the reality is Atlantic Canada has a much more complicated demographic situation than lots of other places like Alberta if you look at Mississauga for example there's 240 births every year for every hundred deaths whereas on PEI we have more people dying every year than that are born. And Ben, I want to talk to you a bit about what you're seeing on the ground here on PEI. The report does say that public opinion is turning against immigration. Are you seeing that on the ground here and how is that impacting island businesses? Well, I think, Wayne, there's a bit of, there's some confusion about what immigration is or what people want or what people need. You know, there's no question that population growth needs to be more deliberate and controlled but we also we know we need to have it right so we probably over corrected in our chambers opinion or the opinion of the chambers across the island like if there's more deaths and births as david's pointing out the workforce of the future has to come from somewhere and some of it will come from you know people that are born on Prince Edward Island and grow up here but until that statistic shifts the other way and you have more people being born than are dying like Mississauga and Ontario we do need immigration and what's the impact on island businesses then without it we're starting to see it i think this year but if we don't see a return to some of those immigration levels what does it mean for businesses on the ground well so what we've been hearing from members and this would be unanimous between Summerside, Kensington, Eastern Prince Edward Island, West Prince and the Franco chamber as well as our Charlottetown chamber it's that they don't they can't fill the positions they need to operate. So you have a lot of businesses that are cutting their hours, going without shifts, operating with not enough people, which becomes a safety hazard. It burns out employees, their turnover rate goes up, and their cost of operating goes up. And it's pretty significant because it's easy to say a half a shift here or a half a shift there isn't an impact, but it is because if you're a business that supplies that restaurant, to use an example or a coffee shop or retail operation with a product and they cut that shift and now you can't supply them with that product and now your employee that you use to make that product for them their hours get cut and the money that they earn from those positions can't get spent in the economy and you multiply that by hundreds of people and thousands of people that is a problem for everybody that affects every business everywhere every islander eventually. And so that's why we are so adamant that we need to focus on population growth and find a strategy that aligns better with the interests of everyone on Prince Edward Island Well, and the report shows that the job vacancy rate in June of this year was the highest among the 10 provinces in the country. So we have a higher job vacancy situation here than all other nine provinces across the country. So that's a real issue. It's a barrier to future economic growth. And the other thing I would say is a lot of our key industries are still fairly labor-intensive. If you think about tourism, if you think about farming, if you think about fishing and fish processing, those tend to be fairly labor-intensive. Now, they are starting to become more automated, but it's pretty hard to automate tourism. If you go to a restaurant, you want to see somebody, a friendly face serving you food if you go to an accommodations or a hotel. So that's just the nature of the economy here, and we need to make sure we have the workforce to meet the demand of the local economy. And David, I have to ask you, there's an interesting read in the report that talks about the misalignment with national economic priorities that the federal government is focusing on things like oil and gas and defense, industries that are not traditionally strong here on PEI. How concerning is that? Well, it's somewhat concerning. In other words, it's good to see the federal government taking an approach around economic development to try and diversify away from the U.S. and leverage our natural resources for economic development. The problem is PEI doesn't have a lot of mineral resources and oil and gas, and it's not really a good location for those large nuclear power plants and big energy projects, and even defense. We don't have a very large defense industry here. So the point of the report is just to say, you know, we are kind of operating here with one hand behind our back in terms of federal priorities, but that doesn't mean we can't get more of the defense investment and also that the you know that the federal government should uh help uh support our other key industries for example the federal government was very important in uh when we got the vaccine manufacturing plant uh i think it was last year a year and a half ago so there is some alignment there but for the most part you know if you think about the big federal projects there was 167 identified at the Canadian investment summit and only two uh had were associated with PEI and one of them was the undersea electric cable to New Brunswick. So I think that's a concern, but it's just something that we have to look at and try to address. Well, thank you both for coming in. Appreciate the opportunity. Thank you.