Hamilton's economic growth slowing in 2015: Report

Economic growth in Hamilton is predicted to slow down this year, while housing starts also drop significantly, according to the Conference Board of Canada.

The board's Metropolitan Outlook for Autumn 2015 says economic growth is expected to drop to 1.5 per cent this year, down from 2.1 per cent in 2014.

While housing prices continue to rise, the region's housing starts are also expected to decline by 23 per cent this year.

• RELATED: Average Hamilton house price jumps 16.4% in past year
• RELATED: Hamilton prepares to guard itself from impact of a recession

"The slowdown in Hamilton's economy is broad-based, as many sectors of the economy are expected to see weaker growth this year," said Alan Arcand, associate director of the Centre for Municipal Studies in a statement.

Housing starts are on track to tumble by over 23 per cent in 2015 to 2,170 units, which is the lowest level the city has seen in in six years. That swift drop in housing starts will lead to slower output growth for the finance, insurance and real estate sectors, the conference board says.

Conference Board of Canada Economist Jane McIntyre told CBC News that the decline was caused in part by condo projects starting last year that are now finishing up but also due to the weather last winter, which was one of the coldest on record.

"It was just too cold to really build in some cases," McIntyre said.

Growth projected to reappear in 2016

But that doesn't look like a long-term trend (weather permitting, anyway). Economic growth is projected to pick up next year, and the conference board says housing starts should increase by 29.5 per cent in 2016.

"They should remain on this upward trend over the next few years, reaching 3,380 units by 2019," the report reads.

But while residential housing starts are soft this year, non-residential construction is helping to bolster the industry. Projects like McMaster University's $118 million multipurpose building and cleanup efforts for Randle Reef (which is slated to start this year) will help.

Hamilton's manufacturing sector saw growth of 3.9 per cent last year, with Maple Leaf's new meat processing plant picking up some of the faltering Steel Industry's slack. "A lower Canadian dollar will help Hamilton's manufacturing sector make further gains this year and next, as it will make Canadian goods more attractive abroad," the report reads.

Manufacturing output growth is projected to come in at 1.9 per cent in each of the next two years.

Report touts growth from Pan Am Games

The report also says personal services sector activity will accelerate in 2015, "Partly thanks to increased tourism numbers stemming from the Pan Am/Parapan Am Games."

But local merchants did not report an upswing from the Pan Am Games last summer in some cases, business actually went down.

McIntyre said the report measured things like retail trade, hotels and food spending related to the Pan Am Games, but couldn't provide any concrete numbers. "I don't have an exact number or calculations for you," she said.

Mirroring the overall economic outlook drop, the report says that services sector activity will cool to 1.4 per cent growth this year following 2 per cent growth in 2014. The transportation and warehousing sector, which has shrunk in three of the past five years because of declining shipping requirements from the steel industry, is forecasted to shrink another 2.2 per cent this year.

adam.carter@cbc.ca