Page 19 - GBC summer ENG 2023

forecast is a further decline to 3.0% by August, which will certainly help. However, there may still be some short-term reduced spending by consumers that would negatively impact golf.
The Central Bank Rate in Canada rose through 2022 from 0.25% to 4.5% where it stands at this time. This was the Bank of Canada’s manipulation to stop the rising inflation and then reduce it. Although the strategy is effectively bringing down inflation, those higher rates also imply that the debt service for golf course opera- tors and any loans or mortgages for golfers will become significantly more expensive. For the 2023 golf season, the central bank rate is expected to stay flat near 4.5% throughout.
Canada’s Unemployment Rate also affects golf course operators. For 2022, it was near historical lows, hovering around 5.3%. That contrib- uted to the staff shortages and wage increases reported by the majority of facilities. For 2023, our unemployment rate is forecasted to rise to between 5.4% and 5.8%, which should help relieve the HR pressures on many golf courses.
Real GDP grew by 3.6% in Canada during 2022, surpassing expecta- tions despite various headwinds facing the economy. That growth gener- ally implies good news for consumer spending and business success, however it also prompted the labour shortage and inflation. For 2023, Real GDP is projected to stall, with annual growth of just 0.3% to 0.7%. That is also expected to include a couple of quarters of contraction. Such a recession would be predicted to soften golfer spending but improve the staff shortage issue.
Consumer Confidence is another key indicator and ranged between 46.6 and 52.2 in 2022, with an index of 50 representing average confi- dence in their own financial well being for the near future. As of March 2023, it had declined to 47.3, meaning that many golfers are becoming increasingly pessimistic and more cautious with their spending patterns.
Business Confidence across all industries for 2023 is currently at an index of 51.6, slightly better than average and an indicator of more optimism than consumers. Based upon the NGCOA Canada’s Pulse Report, golf course operators appear to share that cautious optimism heading into this golf season.
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