A study released by the Institut du Québec on June 3 reveals that mutual funds and exchange traded funds (ETFs) are booming in Quebec, both when measured by assets under management as well as by the number of people employed in the industry.

The study, Quebec’s Mutual Fund Industry; Assessing the Economic Footprint, found that assets under management in this sector more than doubled in Quebec over the last decade, increasing from $81.4 billion in 2004 to $180.5 billion in 2013. This represents an annual rate of growth of 9.3% during the period.

The report indicates that this rate of growth is similar to that seen in Canada as a whole and Ontario in particular. Asset levels in Quebec, however, still remain below those in Ontario. According to Investor Economics, one of the sources for the study, mutual fund assets under management in Ontario reached $489.4 billion in 2013.

Quebec's investment fund industry continues to develop. Data that was collected independent from the study by Investors Economics and provided by the Council of Quebec Investment Funds (CFIQ) shows that, in December 2014, mutual fund assets under management in Quebec reached $210 billion.

The Institut du Québec study also includes ETFs in its results. As of December 31, 2013, the product accounted for less than one dollar out of ten in total investment fund assets. However, this asset class has experienced rapid growth in recent years; according to data from Investor Economics, ETF assets in the province reached $13.6 billion by end of 2014 compared to the $11 billion recorded for the previous year. This is a gain of more than 23%. In comparison, Investor Economics says mutual fund assets in Quebec increased by 16% over this period, going from $170 billion in 2013 to $197 billion in 2014.

The study attributes the popularity of investment funds in part to an ageing population and the fact that the burden of retirement savings has been transferred from employers to individuals. A significant trend in this transfer of responsibility is the shift away from defined benefit plans towards defined contribution plans. "In Quebec, the ratio of workers to retirees will fall from more than 7 in the 1970s to nearly 2 within the next two decades," reads the report. "Defined contribution plans shift the onus of financial planning to individuals, who must then turn to financial products, particularly those offered by dealers offered by dealers."

The Institut's report reveals that the mutual fund industry directly employed 9,129 people in Quebec in 2013, compared to just 5,747 in 2009, which is an increase of 59%. In 2013, for each of these direct jobs, there was another job that was indirectly related to the sector, such as legal and accounting services, for a total of 18,211 jobs in the province.

In 2013, the fund industry also made a direct contribution of $861 million to Quebec's economy. Overall, activity in this sector increased personal household income in Quebec by $1.4 billion a year, business profits by $235 million, and provincial government revenues by $435 million.

According to the Institut, the sector's economic impact on Quebec reached $1.8 billion in 2013, which is nearly 0.5% of the province’s total GDP. "Over the last decade, the economic activity associated with funds has grown much more quickly than the overall economy, both in Quebec and across Canada, primarily as a result of the demographic and regulatory changes that have occurred during this time," says the report.