Please note that this forecast was prepared before COVID 19 dramatically changed the near term economic outlook.

• Quebec will average annual GDP growth of 1.5 per cent over the long term.
• Our forecast for only modest economic growth is being driven primarily by a deceleration in labour force growth and the aging of the population.
• In 2040, those aged 65 and over will account for over a quarter of Quebec’s population, compared with 19.4 per cent in 2019.
• Housing starts will decline sharply over the long term, as an aging population will require the construction of fewer single-detached homes.
• There could be fewer immigrants arriving in Quebec over the medium and long terms as a result of the government’s plan to reduce immigration levels.
• The export outlook for Quebec has improved somewhat, thanks to the pending ratification of the CUSMA trade agreement by the U.S. Congress. However, over the long term, the continuation of large U.S. trade deficits will lead to ongoing trade disputes between the U.S. and its trade partners no matter which party is in power in Washington. This has the potential to hurt Quebec’s exports.

Summary

Quebec—Population aging means weaker growth

• Overview
• Demographic patterns
• Potential output
• Aggregate demand

Appendix A—Defining and estimating potential output for Canada’s provinces

• Measuring potential output
• Estimating potential employment
• Estimating capital
• Estimating total factor productivity
• The output gap

Appendix B—Data Tables