Economy of Alberta

Agriculture, forestry, and fishing

About one-third of Alberta’s land area is in agricultural use, with roughly half that agricultural land used to grow crops and the remainder to raise livestock. A network of dugouts and irrigation canals provides water in dry areas. The main crops are wheat, barley, and other grains, as well as hay and rapeseed (canola). Specialty crops such as sugar beet, potatoes, peas, and mustard seed are locally important. Beef cattle dominate livestock production, but pigs, poultry, and sheep are raised as well.

Forests cover more than one-half of the province’s surface. Aspen, white spruce, and pines are the principal commercial species and are used for lumber, wafer board, newsprint, pulp, and paper. Commercial fishing, mostly of whitefish, is done in Alberta’s northern lakes.

Resources and power

Alberta contains the bulk of Canada’s known fossil fuels. Oil and natural gas occur widely, and major deposits of heavy crude oil and oil sands are exploited in the Lloydminster, Cold Lake, and Fort McMurray regions along the eastern border with Saskatchewan. Alberta produces the vast majority of Canada’s natural gas and crude oil and roughly half of its coal. Not surprisingly, fluctuations in world oil prices seriously affect the province’s economy. Other mineral resources include sand and gravel, limestone, and salt, but the most valuable is sulphur, most of which is extracted from natural gas.

Most of Alberta has an abundance of lakes and rivers, some of which are exploited for irrigation and hydroelectric power; however, the ecological damage caused by these projects has brought about widespread controversy. Natural resources are largely developed by private industry (much of which is foreign-managed and financed), under provincial and federal regulation. Extensive government research and assistance benefit resource development and agriculture.

Manufacturing

The manufacturing sector in Alberta is heavily oriented toward the processing of primary goods. The leading industries are food-processing (especially meat products), chemicals, petroleum, and wood-related products. Metal fabrication and the manufacture of machinery and equipment have also become important, and there have been significant developments in the telecommunication, biotechnology, and pharmaceutical industries. Construction is extremely important, too, though it is much affected by economic developments in the local petroleum industry.

Services, labour, and taxation

Alberta’s rich wildlife and spectacular scenery, in combination with historic cultural attractions and the huge shopping and entertainment complex known as West Edmonton Mall, form the basis of an expanding tourism industry. Indeed, notwithstanding the petroleum industry’s importance in the province, about half of Alberta’s workforce is employed in the service sector. Calgary in particular has grown as a financial centre, with a swelling number of corporation headquarters located there. Because of the province’s vibrant economy, unemployment rates in Alberta were among the lowest in Canada and consistently below the national average at the end of the 20th century and the beginning of the 21st century.

The major sources of municipal revenue are property and business taxes, user fees, sales of goods and services, and provincial government grants and loans. Some municipalities derive additional revenue from the operation of utilities, many of which are now privatized. Created in 1976 and restructured in 1997, the Heritage Fund saves and invests revenues from Alberta’s oil and gas reserves for the benefit of future generations.

Transportation and telecommunications

In southern Alberta transportation is dominated by east–west routes that thread the few mountain passes and spread over the plains. There is also good access south into the United States. Air and surface routes fan out from Edmonton to serve Alaska and the Canadian northwest. Indeed, air transport has been used in development of northern resources since 1921, and the province is well served by local, regional, and charter service. Moreover, both Edmonton and Calgary have international airports. Freight is also shipped on the Athabasca and Slave rivers. The east–west Canadian Pacific and Canadian National railways have a network of branch lines serving agricultural and northern areas, though a number were closed at the turn of the 21st century. Oil and gas pipelines link Alberta to markets as far away as Quebec and California. Alberta’s major highways include the Trans-Canada and Yellowhead east–west routes and the Mackenzie highway to the north. The province has also benefitted from the access to the northwest provided by the nearby Alaska highway.

Alberta is at the forefront of telecommunications developments in Canada. Largely as a result of the far-flung oil and gas industry, wireless technology has been widely implemented, and the province has also become an important exporter of wireless products and services. As a result, Albertans are among the highest per capita users of wireless technology in the country.