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CALGARY, ALBERTA--(Marketwire - Dec. 7, 2011) - Alberta's economy is significantly outperforming the national average in 2011, and should remain near the top of the growth leaderboard next year, according to the Provincial Monitor report released today by BMO Economics.

"High oil prices are fuelling activity in the energy sector, which in turn is driving strong labour market performance," said Robert Kavcic, Economist, BMO Capital Markets. "Real GDP is on track to grow 3.3 per cent in 2011. The province should also remain near the top of the growth leaderboard next year, with growth of 2.8 per cent running almost a full percentage point above the national average."

Despite the sovereign debt crisis in Europe, cooling growth in China and expected sluggish growth in the U.S., West Texas Intermediate crude oil prices remain firm near $100 per barrel. "Despite some temporary disruptions earlier this year due to wildfires, oil production was up a solid 7.8 per cent year-over-year through August, with even more robust 10.8 per cent year-over-year growth in crude bitumen production," noted Mr. Kavcic. "Longer term, Alberta is expecting raw bitumen production to rise 14 per cent per year in the next two years, as conventional crude output remains about flat, while natural gas production declines."

Strength in the energy sector has rekindled in-migration and helped firm up the labour market. Net interprovincial in-migration was the highest since early 2008 in the first half of the year. "Employment growth was a robust 4.8 per cent year-over-year in November, well above the 1.2 per cent year-over-year national pace, and the jobless rate has fallen almost a full percentage point since January, to 5.0 per cent," stated Mr. Kavcic.

"With the private sector driving Alberta's impressive employment growth, Albertans are demonstrating their confidence in the economy," said Bill Hogg, District Vice-President, Commercial, Alberta, BMO Bank of Montreal. "It's no surprise that we're seeing entrepreneurs continue to make strategic investments to grow their businesses and open up new markets."

Alberta's second quarter fiscal update increased the fiscal 2011-2012 deficit estimate to $3.1 billion (1.1 per cent of GDP) from the $1.3 billion first quarter estimate, which is still less than the Budget's $3.4 billion. Alberta plans to return to a surplus position by fiscal 2013-2014, and cover budget shortfalls out of its Stability Fund (which should total $8.1 billion at the end of this fiscal year).

The full Provincial Monitor can be downloaded at www.bmocm.com/economics.