Calgary’s economic outlook maps a path through volatility

Brad Parry, president and CEO of Calgary Economic Development, speaks at the 2026 Economic Outlook. — Photo by Jennifer Friesen, Digital Journal

“It is Caligula level craziness in the White House,” Andrew Coyne told leaders gathered for Calgary Economic Development’s 2026 Economic Outlook event. 

Caligula, for anyone who missed the livelier eras in Roman history class, was known for erratic behaviour, cruelty and the rumoured attempt to appoint his horse to public office. 

The line drew laughter, but it also captured one thread running through this year’s Outlook. Political volatility in the United States is adding uncertainty to an already complex economic environment.

The Economic Outlook is CED’s annual opportunity to brief Calgary’s business community on the conditions shaping the year ahead. The 2026 edition arrived at a moment defined not by a single force, but by the collision of several. Calgary is absorbing record population growth. Alberta is creating jobs while facing recession-level unemployment. Canada is confronting long-standing productivity challenges. Businesses are bracing for regulatory drag and shifting global markets. And yes, instability in the United States now sits alongside these pressures as a meaningful factor in how leaders plan.

Within that wider context, Coyne, columnist with The Globe and Mail and a member of the At Issue panel on CBC’s The National,  urged the audience to stay alert to how abnormal political behaviour can become routine. 

Coyne’s remarks framed one aspect of the uncertainty shaping the Outlook, but they sat alongside a broader conversation about the pressures influencing Calgary’s and Canada’s economic trajectory. The themes that carried through the day were rooted in fundamentals: labour capacity, population growth, productivity, investment conditions and the structural ties that still shape Canada’s relationship with the United States. Together, they set the stage for a discussion about what it will take to build durable growth in a more unpredictable decade.

The gravitational pull of the U.S. economy

Coyne’s comments served as a reminder that Canada operates in a global system that is shifting in real time, but the day’s focus remained rooted in the economic choices shaping Alberta’s direction heading into 2026.

Mark Parsons, vice president and chief economist at ATB Financial, underscored the structural reality that guides much of Canada’s growth strategy. The United States remains central to the country’s trade profile, and the data shows little movement away from that reliance.

“Seventy-six per cent of our exports went to the U.S. in 2024,” Parsons said. The share has barely moved. “So far this year, 74%. Anyone who’s saying, well, we’re done with the Americans does not understand the data.”

Coyne added that this reliance is complicated by the policy environment Canada will face next year. He pointed to continued protectionist tendencies, the possibility of sector-specific tariffs and the uncertainty surrounding the upcoming CUSMA review. He also noted that the scale of the American market makes diversification difficult even when the intent is there.

The result is a backdrop Canada must navigate while working through its own growth challenges at home.

The conditions shaping Calgary’s growth capacity

Parsons described the constraints and opportunities shaping Alberta’s capacity to contribute to Canada’s growth. The province is adding jobs quickly while absorbing record levels of population growth. 

“We are in this really odd position where we are leading the country in job growth, but we have recession-like levels of unemployment,” he said, adding that more than 200,000 people moved to Alberta in 2024, half of them to Calgary. The scale of that arrival has intensified pressure on housing, services and employer hiring capacity, and it has exposed mismatches between the skills newcomers bring and the skills employers need.

Calgary Mayor Jeromy Farkas said the pressure is visible across the city. 

“Calgary is growing very quickly, the economy around us is shifting and families and businesses are feeling real pressure,” he said. The combination of record population growth and a fast-changing economy is shaping the strain many households and employers are experiencing.

Parsons said the recent federal budget acknowledged the scale of Canada’s investment and productivity challenges more directly than in past years. The budget includes goals such as doubling non-US exports over the next decade and outlines the structural issues holding back growth. That direction aligns with the way Calgary’s strengths are evolving. Energy continues to be a major driver of productivity, and sectors like hydrogen, renewables, critical minerals and tech are creating new areas of growth. Parsons argued that these sectors are advancing in parallel rather than competing for priority. 

“This is an ‘and’ economy,” he said.

He also warned that public debate can drift away from what matters. “Did you know that we’d be talking about elbows so much in 2025 like elbows up, elbows down. What are your elbows doing? I have no idea.” The aside illustrated how quickly attention can scatter in a period that demands focus and execution.

“We’ve identified the problem. Very important first step,” Parsons said. “But how are we going to do it?”

Innovation and productivity as economic essentials

Productivity became a central theme because it sits at the intersection of national and local pressures. Calgary and Alberta are managing record population growth, shifting labour needs and rising demand for infrastructure and services. Those pressures make productivity more than a macroeconomic metric. It affects how quickly the region can absorb new workers, how competitive its businesses can be and how resilient the economy is when conditions tighten.

At the national level, Coyne said Canada will not close its structural gaps through small adjustments. 

“Go big or go home,” he said. “Broader, more radical tax reform is not only the better policy in economic terms, it’s more politically saleable.” He said incremental moves often antagonize the groups they touch, while larger reforms can distribute benefits widely enough to outweigh the pushback.

He also pointed to the role of firm-level behaviour. 

“We need to start thinking about it as an economic process,” Coyne said. Productivity, he argued, is built through thousands of choices inside organizations. “What really moves the needle is if every manager at every one of the 1.4 million businesses across the country lies awake at night saying to him or herself, ‘What am I going to do tomorrow to make my company more efficient?’”

Parry’s comments reinforced that point at the company level. He said innovation has to show up in how firms operate, not in how they position themselves publicly. 

Parry’s comments reinforced the focus on how companies operate. He said innovation has to show up in daily work rather than in public positioning. 

“Innovation can’t just be a buzzword. It’s got to be a blueprint, a blueprint for how we win this next decade,” he said.

Parry also identified regulatory complexity as a drag on economic performance.Drawing on Statistics Canada research, he pointed to the cumulative impact of federal regulatory growth over the past 15 years, including a 1.7% reduction in national GDP, a 1.3% drop in employment growth and a 9% decline in business investment. 

Roughly 86,700 federal regulations were added during that period, he continued, contributing to a system that slows innovation rather than enabling it.

“Regulation is impeding our ability to innovate, and it’s stifling our economy,” he said.

Across the program, innovation and productivity were positioned as intertwined requirements for Canada’s resilience. Both relate to the country’s ability to respond to external shocks and to convert its strengths into long-term competitive advantage.

The new context for Canada’s growth outlook

Coyne’s Caligula reference underscored how different today’s geopolitical environment is from the one Canada has relied on for decades. 

Stability and predictability once defined the country’s most important trading relationship. That foundation has eroded, and the backdrop for CED’s annual guidance to Calgary’s business community has shifted notably from the year before.

Speakers pointed to a common set of pressures from different vantage points. 

Investment, market access, regulation, and workforce capacity each carry implications for how Canada positions itself in a decade marked by increasingly limited certainty.

A national growth strategy will determine whether the country can leverage its strengths in energy, technology, and emerging industries. Those advantages depend on policy clarity, labour capacity and the reliability of the trading relationships that underpin the economy.

Uncertainty abroad is part of the landscape, but the momentum Alberta builds at home will decide how the province competes in the decade ahead.

Final shots

• Canada’s growth strategy now depends on navigating U.S. volatility while strengthening the fundamentals at home.
• Calgary’s population surge and labour-market strain show how quickly growth pressure can outpace capacity.
• Productivity and innovation are linked, and both rely on decisions made inside firms, not just in policy rooms.
• Regulatory drag and unclear market access continue to hold back investment at the moment they matter most.