Is Alberta’s economy really gaining momentum?

Last week, Siddhartha Bhattacharya, an economist with ATB Economics, published an article regarding manufacturing shipments in Alberta.

The article reports that manufacturing shipments were up significantly between February and March, and that increase was part of a long-term trend.

Here’s a graph they provided.

As you can see, the value of manufacturing shipments was up quite a bit over February. In fact, it was up by more than half a billion dollars. Not only that, but the increase is even more significant over March 2021 and March 2020.

The article was picked up by several people connected to the UCP caucus.

For example, Doug Schweitzer, Alberta’s economy minister, quote tweeted it with the comment “Momentum!”

Momentum! https://t.co/R9V6imo46w

— Doug Schweitzer (@doug_schweitzer) April 14, 2022

Schweitzer’s tweet was then retweeted by his press secretary, Tricia Velthuizen, and Justin Brattinga, the press secretary for the Alberta premier. It was also retweeted by the UCP Caucus account.

It was liked by Bryan Rogers, the chief of staff for the minister of agriculture; Steve Buick, the health minister’s press secretary; and Brian Bateson, an issues manager for the premier.

The next day, Jason Kenney quotetweeted the same thing, saying that our recovery from the pandemic is picking up steam.

Manufacturing shipments are up! ⁰⁰Alberta’s recovery keeps on picking up steam. https://t.co/mFUvGhlqs5

— Jason Kenney 🇺🇦 (@jkenney) April 15, 2022

Bateson, Brattinga, Schweitzer, and Velthuizen all retweeted Kenney’s tweet. Winston Pon, who’s Kenney’s director of digital and son of Josephine Pon, the minister of seniors and housing, also retweeted it.

But I wonder if any of them even read the article. I wonder if they saw the graph and got excited, thinking it’s proof that the economy is on fire and that—to quote the premier—“Alberta’s Recovery Plan is working!”

Consider this quote from the article:

Higher commodity prices in the wake of tight supplies and strong demand continue to abet the value of manufacturing shipments in the country.

This isn’t a booming economy; this is a result of higher commodity prices, such as oil.

Remember, the graph shows the dollar value of shipments, and if everything costs more, the total value of those shipments naturally will increase, too.

Not only that, but Bhattacharya goes on to say that “we can expect the ongoing Russian invasion of Ukraine to put additional upward pressure on manufacturing prices in future months.”

In other words, we’re going to see this upward trend in future data, but again, it’s because of global inflationary pressures, not because UCP policy, or even the local Alberta economy.

Here, let me show you one more graph.

This is the inflation rate for Canada. according to this website. Notice anything?

Let’s overlay the two graphs:

Sure enough, as inflation has increased, so has the dollar value of manufacturing shipments of Alberta. Imagine that.

If you really want to see whether Alberta’s economic policies are affecting the economy, we’d need to see the number of shipments over times, rather than their value.