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June 01, 2021NON-RESIDENTIAL FIXED CAPITAL INVESTMENT, Q1 2021 Non-residential fixed capital investment consists of expenditures made by business, governments and non-profit institutions serving households that add to the capital stock for production of goods and services in an economy. Investment that are included are buildings, engineering construction (i.e. bridge, mine structure), machinery and equipment, and intellectual property products (i.e. software, mineral exploration) but it doesn’t include non-reproducible assets (lands, mineral deposits, natural resources) or housing investment. Statistics Canada has begun to release quarterly data on non-residential fixed capital investment and stock for the provinces with historical data back to 2013. Note, the data is not seasonally adjusted and expressed in current prices.
Nova Scotia non-residential investment has trended upwards since Q1 2013, rising from $1,201 million in Q1 2013 to $1,568 million in Q4 2019. Non-residential investment declined in the first half of 2020 but increased to $1,495 million in Q4 2020. Investment in Nova Scotia's fixed capital declined 5.4% from the previous quarter to $1,415 million in Q1 2021. Business sector non-residential investment has declined to a greater extent in 2020 than in the government sector. Government and non-profit institution serving households was mostly flat from 2013 through 2017 but has been at higher level over from 2018 to 2020.
Within the business sector, machinery and equipment account for majority of fixed capital investments. Compared to Q1 2020, the decline in the business sector investment was mainly due to lower investment in engineering construction (-20.9%) with buildings (-8.8%) and machinery and equipment (-8.0%) also registering declines. Investment in intellectual property products increased 3.4% from the previous year to $122 million in Q1 2021.
Government investment in machinery and equipment rose through 2018 and has maintained an elevated levels though 2020 at around $213 million per quarter. In Q1 2021, government and non-profit investment has increased 2.6% from the previous year supported with gains in engineering structures (+9.8%), intellectual property products (+2.8%), buildings (+1.3%) and machinery and equipment (+0.8%).
PROVINCES NON-RESIDENTIAL INVESTMENT: Q1 2021 vs Q1 2020
Non-residential investment declined in all provinces from the previous year in Q1 2021. Nationally non-residential investment was down 6.0% with Newfoundland and Labrador (-13.9%) posting the largest decline. The smallest decline was recorded in Prince Edward Island (-1.9%).
Within the business sector, Newfoundland and Labrador (-19.0%) reported the largest decline. The smallest decline was in Ontario (-7.2%) and Quebec (-7.3%).
Government and non-profit fixed capital investment increased in every province. Prince Edward Island (+8.1%) posted the largest gain while Nova Scotia (+2.6%) reported the smallest increase.
Compared to Q1 2020, non-residential investment in buildings was down 4.8% in Canada with all provinces reporting declines. Prince Edward Island (-5.4%) reported the largest decline while Newfoundland and Labrador (-2.5%) recorded the smallest.
Engineering structure investment was also down in every province in Q1 2021. Prince Edward Island (-2.5%) and Nova Scotia (-6.6%) reported the lowest declines. The Prairie provinces and Newfoundland and Labrador recorded the largest declines from the previous year.
Machinery and equipment investment declined 3.5% in Canada with all provinces recording declines. Prairie provinces posted the largest declines while Ontario (-2.4%) posted the lowest.
Intellectual property products increased 2.5% in Canada with seven provinces recording gains led by Quebec (+5.1%) and Ontario (+5.0%). Newfoundland and Labrador (-17.8%) reported the largest decline.
NOVA SCOTIA (Q1 2021 vs Q1 2020)
Non-residential investment in Nova Scotia declined 3.5% from a year earlier in Q1 2021. The gains in intellectual property products (+2.3%) were not able to offset the declines registered in engineering structures (-6.6%), machinery and equipment (-4.6%) and buildings (-3.5%). The largest contributor to the overall decline (-$52 million) was in machinery and equipment investment (-$30 million).
Statistics Canada. Table 34-10-0163-01 Flows and stocks of fixed non-residential and residential capital, by sector and asset, provincial and territorial (x 1,000,000)
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