Forget wholesale trade statistics, manufacturing indices, or balance of trade reports. For many people, the only economic indicator that matters is the employment report.

The latest Labour Force Survey from Statistics Canada shows that Alberta added an astounding 99,000 jobs over the past year – nearly half of all of the new jobs created in the country. To say that Alberta has been the engine of job creation in Canada is no exaggeration. More new jobs were created in Alberta than in Ontario (a province four times as large) or British Columbia. Quebec lost 51,000 jobs, and the rest of the country was mostly unchanged.

What lies in store for Alberta’s labour market in 2012? And which sectors of the provincial economy are likely to experience the biggest gains (or losses)?

First, the most probable scenario is that Alberta will continue to create jobs in 2012, but at a slower pace. Last year’s average employment level increased by 3.8% from 2010, which is a very robust rate of job creation. (Canada’s total economy also posted an increase, but a much more modest 1.5%). That rate of job formation is very difficult to maintain. If 2011 was like a sprint, 2012 is more likely to be a marathon – slower, but steadier.

Even if the rate of job creation falls by half, say, to 50,000 new jobs this year, that would still represent a very respectable growth rate. This is particularly true given all of the global economic turmoil that is gripping Europe, the U.S. and even Asia.

Even central Canada seems to be bracing for a recession. Indeed, a report this week from the Economic Club of Canada suggests that 70% of Canadians already believe we are in recession.

Second, an analysis of job creation in 2011 by sector reveals some interesting trends. Almost every sector posted an increase, but the bulk of the 99,000 new jobs created were in retail and wholesale trade (+22,300), oil and gas extraction (+13,600), health care and social assistance (+13,200), agriculture (+11,900) and manufacturing (+11,100). Those trends are likely to continue in 2012, especially in health care, oil and gas, and manufacturing. These were some of the sectors hardest hit during the 2008-09 downturn, and they are still rebuilding. The aging population will ensure that health care and social assistance will remain near the top for new jobs in the years to come.

Third, the only two sectors to post much of a decline in jobs were utilities (-4,500) and the public sector (-2,200). The latter may be the one sector most likely to see further contraction in 2012, with all three levels of government – federal, provincial and municipal – moving to tighten belts and battle deficits. Alberta may not experience many outright layoffs in the public sector as it did back in the 1990s, but through attrition and freezes on hiring, the three levels of government may continue to see some shrinkage this year.

Finally, the manufacturing and oil and gas sectors could once again be the stars of 2012. With oil prices heading above $US100 per barrel early in the year, Alberta is poised to see more investment and hiring in the energy patch. Manufacturing in Alberta, unlike central Canada, is focused to a large degree on items related to the energy sector – steel pipe, specialized equipment and parts for the oil sands, and refined petroleum products.

However, the outlook for Alberta’s energy sector depends, as always, on the world price, and at the moment, price is extremely difficult to forecast. With so many moving parts in the global energy economy (the Middle East, the Euro crisis, the health of the U.S. consumer, and even a possible slowdown in China), literally anything could happen. It appears at the moment, however, that prices will remain at or near the $100 mark.

But a few more threats from Iran to close the Strait of Hormuz could send prices soaring to well above $120, or even $150 if tensions in the Middle East escalate further. On the other hand, possible news of the Euro coming apart or China’s economy stalling could knock prices back to $50. Uncertainty is extremely high.

Reading the tea leaves is rife with hazard, but a likely scenario would be that Alberta continues to lead Canada in job creation in 2012, albeit at a slower pace. Manufacturing and energy sector workers will continue to be in demand (as witnessed already by shortages for workers in some parts of the province), while certain services and public sector positions could see some contraction.

Overall, however, Alberta will continue to be the place to be!

Todd Hirsch is Senior Economist with ATB Financial