Nanaimo’s growth will present both challenges and opportunities, says the City of Nanaimo’s Economic Development Officer.
Amrit Manhas gave a presentation on the “state of Nanaimo’s economy” at a Monday April 4 city council meeting and noted, for example, that housing starts are up and population growth aged 25 to 44 is expected to exceed that of the population over 65 over the next decade.
The report reviewed around 30 indicators such as gross domestic product, demographics, business, development, housing, real estate, local workforce, income and tourism to paint a picture of Nanaimo’s economy and the directions it may take in the years to come.
Nanaimo’s population growth rate over the reporting period ranked among the highest in Canada.
“According to the 2021 census, Nanaimo was among the five fastest growing urban centers in Canada…our growth rate was twice the growth rate of the country,” Manhas said.
From 2016 to 2021, Nanaimo’s population grew by 10.3%, or about 9,400 people, and is expected to add just under 12,000 more people, or about 12% more, by 2026.
Manhas said that from 2016 to 2021, the number of housing units in the city has also increased by around 10.4%.
“So what does all of this mean in terms of implications? Well, growth can provide both opportunities and challenges,” she said. “New entrants increase demand for retail and personal services, which helps our existing businesses, but growth can also strain existing infrastructure…and, of course, as you all know, we anticipate this growth. now with the ReImagine Nanaimo process. ”
Most of the population growth in Nanaimo, 3,617 people in 2021, was due to immigration from other provinces. Manhas said that over the next decade, the 25-44 age category of the population is expected to increase by 25%. Changing demographics will lead to structural changes in the economy, as a younger population demands different services and amenities, such as nightlife entertainment and schools, and a growing population will also mean prioritizing investments in infrastructure and housing.
In 2021, Nanaimo had 6,214 licensed businesses, with the largest portion, 1,219, being in the construction sector, followed by professional, scientific and technical services, 786, and the retail sector with 777 licensed businesses. Home-based businesses also made up 41% of businesses in Nanaimo in 2021, an increase of 4% since the start of the pandemic.
“The strongest growth, in terms of business licensing, was in the health care and social services sector as well as in retail,” Manhas said. “The biggest declines [included] hairdressing places, personal training, these types of services, arts and entertainment… but these fluctuations, they really reflect the impact of the COVID restrictions on some of the hardest hit sectors of the economy and we expect that this readjusts again as the economy begins to improve.
The value of building permits for 2021 was the second highest on record at $272 million, a 12% increase from the previous year, driven by non-residential, industrial and public projects. Seventy-five percent of new housing starts were for apartment-type housing. New housing starts, triggered by house prices rising by a record 22% in 2021, jumped 50% to 1,036.
Nanaimo’s unemployment rate fell from 9.1% in 2020 to 6.1% in 2021, but the local workforce also shrank by 1.6% and demand for workers exceeded supply.
Overall student enrollment at VIU decreased by 12.5% in 2020 and international student enrollment fell by 55%, due to COVID-19 travel restrictions.
To learn more about the report and economic development in Nanaimo, visit www.nanaimo.ca/doing-business/economic-development.
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