Canadian Economics

Expectations for a solid economic recovery in Canada this year are linked to rising vaccination rates and the gradual reopening of the economy. The surge in new COVID-19 cases last autumn continued in the early part of this year and led to a return of strict lockdowns in many parts of the country.

Online experience  |  8-min read
June 23, 2021

Inflation accelerated again in May, due mainly to “base effects” on gasoline prices which recovered from the plunge last spring. Higher prices for consumer goods, including cars, new homes and food also contributed to the strong inflation figure last month. Going forward, we expect strong consumer spending coupled with supply shortages will keep inflation hot for the rest of 2021.

Quick take  | 2-min read
June 16, 2021

There are 11 census metropolitan areas (CMAs) with positive short- and long-term expectations this month, the same number as last month. These are the CMAs in the up-up quadrant. Only two CMAs have negative short-term expectations. Vancouver is the only one with both negative short- and long-term expectations.

Online experience  | 8-min read
June 15, 2021

Canada’s immediate economic prospects have improved since our last long-term update in December 2020, as the rollout of vaccines has boosted business and household confidence. At the same time, labour markets are quickly recovering many of the jobs lost due to the pandemic last year. Overall, we expect real GDP to expand in 2021 and in 2022.

Online experience  |  8-min read
June 15, 2021

COVID-19 is challenging many Canadian industries in an unprecedented way. As businesses across the country try to adapt, our Industry Lens reports look deeply into the latest developments affecting Canadian industries.

Online experience  |  2-min read
June 10, 2021

The Bank of Canada held its policy interest rate steady while continuing its weekly net purchases of Government of Canada bonds with a target of $3 billion per week. CPI inflation is around the top of the 1-3 per cent target range but the Bank expects that to ease in the second half of the year.

Quick Take  |  2-min read
June 9, 2021

In cities across Canada, economic recovery from the devastating impact of the COVID-19 pandemic depends largely on the vaccine rollout and containing the spread of the virus. The hardest-hit sectors of the economy—particularly those that depend on people gathering in public—will take longer to recover.

Online experience  |  8-min read
June 8, 2021

The employment declines captured in May’s labour force survey results reflect the lingering impact of the third wave of the pandemic in Canada. However, the severity of the losses is reduced compared to the previous month indicating the peak of the wave has passed.

Quick take  |  3-min read
June 4, 2021

Following two months of solid gains, real GDP rose in March, posting a monthly gain of 1.1 per cent. Overall, the economy forged ahead in the first quarter of the year, supported by strong household and government spending, residential construction and growth in exports. The growth in March is a testament to the resilience of the Canadian economy to perform well when pandemic measures are eased.

Quick take  | 4-min read
June 2, 2021

In 2020, Canada’s real exports plunged, as the global pandemic led to a collapse in demand from all of its major trading partners. The recovery in the global economy, attributable to the widespread distribution of vaccines and a reopening of economies, will help Canada’s exports rebound growth this year and in 2022.

Impact paper  |  24-min read
May 27, 2021

Canada's existing housing markets plateaued in April. Sales pulled back from red-hot March levels in most markets, and listings rose in many areas. Markets remained generally boiling, though, due to low interest rates and the ongoing move to outlying markets.

Online experience  |  8-min read
May 27, 2021

The Index of Consumer Confidence jumped in May almost offsetting the points lost last month. The index now sits at 87 per cent of its pre-pandemic level. With the rollout of vaccines picking up speed, many Canadians are growing more hopeful for an economic reopening, and are thus feeling more confident about their future job prospects.

Online experience  |  8-min read
May 26, 2021

In The Conference Board of Canada’s latest survey of business leaders, business confidence continued its upward trend. Since falling to historic lows in 2020, business confidence has now reached its highest level since mid-2018. With the COVID-19 vaccine campaign ramping up nationally, our survey results indicate that businesses are ready to start spending on capital when the time is right.

Online experience  |  8-min read
May 26, 2021

Inflation spiked in April, due mainly to a rebound in oil prices in the past 12 months as well as the surge in new home prices. We expect that inflation will remain hot in May given the plunge in prices that occurred in the early stage of the pandemic last year. A recovery in global demand for resources and strengthening consumer spending at home, will be the main contributors to inflation going forward.

Quick take  | 3-min read
May 19, 2021

The results from March’s Survey of Manufacturing brings signs of progress across a sector that has suffered in the wake of economic restrictions, delays in global shipping and shortages of key production inputs over the preceding months.

Quick take  | 3-min read
May 14, 2021

World economic activity slowed sharply toward the end of last year in many regions due to a resurgence of the coronavirus pandemic and the reimposition of lockdown restrictions. However, the rollout of vaccines in many countries and massive fiscal and monetary stimulus, especially in the U.S., should result in a gain in world GDP of this year and 2022.

Online experience  |  8-min read
May 13, 2021

April’s Labour Force Survey shows the impact that tightening COVID-19 measures are having on employment in Canada. The third wave of the pandemic dealt a heavy blow to jobs in Ontario, with schools and stores forced to close. However, with the rollout of vaccines underway, we expect employment to bounce back as we have seen in the past once restrictions are eased.

Quick take  | 3-min read
May 7, 2021

Toronto’s financial centre is vital to the Canadian economy—providing jobs, growing GDP, and supporting small and medium-sized enterprises during the pandemic. Total employment in Toronto’s financial sector is ranked second in North America and eighth globally.

Online experience  |  8-min read
May 4, 2021

With real GDP expected to expand this year, forecasters are more positive about Canada’s economy. Canada’s expansion in 2021 will be led by exports, housing activity, and investment spending. The massive fiscal and monetary stimulus injected into the economy—and the subsequent increase in economic growth over the past 12 months—will result in higher increases in consumer prices this year.

Online experience  |  8-min read
May 3, 2021

As national vaccinations started to pick-up in February, real GDP grew by 0.4 per cent month-over-month. With Statistics Canada’s preliminary estimate for growth in March, first quarter output will likely be higher than expected in our most recent national forecast. Yet recent surges in new cases of COVID-19 reversed the loosening of restrictions in many provinces in April. We therefore expect that growth may have cooled off in recent weeks.

Quick take  |  3-min read
April 30, 2021

The surge in new COVID-19 cases last autumn continued in the early part of this year and led to a return of strict lockdowns in many parts of the country. This depressed economic activity, and we anticipate that real GDP growth will increase by only 0.7 per cent in the first quarter of this year. Although the worst of the second wave has subsided, new infections remain high, while more severe variants of the virus continue to increase.

Online experience  |  8-min read
April 28, 2021

Tourism and hospitality is one of Ontario’s key economic drivers. In 2019, the sector employed over 620,000 Ontarians and generated nearly $21 billion in labour income. Before the pandemic-related disruptions, employment in the sector had been stable and sustainable. However, Ontario’s labour market is steadily evolving and, for some tourism and hospitality workers, this evolution has led to job losses, and the COVID-19 pandemic has increased and accelerated these pressures.

Impact Paper  |  15-min read
April 23, 2021
Client—Future Skills Centre

Inflation surged due to a strong rebound in consumer prices this March compared to extremely low prices in the year earlier period. Rising oil and housing prices were two of the main contributors to the strength in inflation. Given subdued consumer prices last spring, we expect that inflation will continue to trend above 2.0 per cent in the coming months.

Quick take  |  3-min read
April 21, 2021

Despite a stronger than expected economic performance in the first quarter of 2021, the Bank of Canada held its policy interest rate steady and announced that its weekly net purchases of Government of Canada bonds will be reduced to a target of $3 billion.

Quick take  |  3-min read
April 21, 2021

Finance Minister Chrystia Freeland’s inaugural budget is intended to transform the economy by favouring vaccine rollouts and economic recovery in the near term and focusing on the labour force, green technology, and education over the long-term. While good intentioned, the fiscal roadmap outlined by the Liberal government will come at a cost to Canadians.

Op-ed  |  4-min read
April 20, 2021

The U.S. economy is set to expand this year on the heels of a 3.5 per cent decline in 2020. Next year, a solid gain is anticipated. One of the main factors driving the rebound is the massive $1.9-trillion stimulus package recently implemented by the Biden administration. The stimulus provides funds for individual families, state and local governments, health care, and the delivery of vaccinations, among other things.

Online experience  |  2-min read
April 19, 2021

Canadian governments, corporate stakeholders, and advocacy organizations sought to use disclosure to accelerate women’s representation. Disclosure is a regulatory approach that requires companies to: (1) disclose the number of women on their boards and (2) disclose the efforts they have made (or not) to increase that representation.

Impact paper  |  30-min read
April 14, 2021

The labour force survey brings news of employment growth across Canada, pushing the unemployment rate to a new low since the onset of the pandemic. Notable employment gains in the retail sector and in Ontario fueled the jobs recovery in March.

Quick take  |  4-min read
April 9, 2021

Amid stricter lockdowns in Ontario and Quebec, Canada’s real GDP managed to post growth in January. With a preliminary estimate of 0.5 per cent growth for February, this suggests that first quarter growth will be stronger than expected in our most recent national forecast.

Quick take  |  4-min read
March 31, 2021

Today’s Statistics Canada release showed that retail sales fell in January, following a decline in December. This drop was almost entirely due to lower retail activity in Ontario and Quebec. In both provinces, January brought curfews, stay-at-home orders, and other restrictions on economic activity. Though many of these restrictions remained in place into February,

Quick take  |  3-min read
March 19, 2021

February’s inflation was up from its year-ago level, thanks to the rapid growth in gasoline and housing prices.As the economy gradually opens and consumer demand rebounds, consumer prices are likely to exceed their year-ago level in the coming months, leading to stronger inflation for the second quarter of 2021.

Quick take  |  2-min read
March 17, 2021

February’s Labour Force Survey brings news of some significant improvements among industries that have suffered greatly over the previous two months, notably retail trade. With the rollout of vaccines underway and a gradual easing of restrictions, this morning’s release marks the restart of the labour market after a difficult couple of months.

Quick take  |  3-min read
March 12, 2021

The impacts of the worldwide pandemic continue to shake the global economy, as the surge in the number of infections has accelerated in three continents, in particular. A key feature of the pandemic’s impact on the global economy has been the vast disparity in growth among the world’s regions.

Online experience  |  5-min read
March 8, 2021

Real GDP posted a 2.3 per cent gain in the fourth quarter of last year, leaving overall economic activity down 5.4 per cent in 2020—by far Canada’s steepest recession in modern times. While the economy recovered over the second half of 2020, economic activity has again slowed in recent months.

Quick Take  |  4-min read
March 2, 2021

The National Shipbuilding Strategy is a long-term initiative to renew Canada’s existing fleet of combat and non-combat vessels. Halifax Shipyard is building the combat vessels. This work falls under four areas: Modernizing the Halifax Shipyard, renewing the navy’s fleet by replacing the existing Halifax Class frigates with 15 newly built Canadian Surface Combatants (CSCs), and repairing, refitting, and maintaining the existing Halifax Class vessels until they are retired.

Data briefing  |  3-min read
February 24, 2021

Each province’s travel market is unique—as are their paths to recovery. Some regions will recover faster than others in the wake of COVID-19, depending on whether their tourism activities can easily be enjoyed while physically distancing. Employment in accommodation and food services is majorly impacted.

Online experience  |  8-min read
February 24, 2021

The agri-food sector is central to Manitoba’s economy and, by far, its largest export sector. It includes agriculture and food manufacturing. Manitoba’s agriculture goods, such as cereals and oil seeds, account for the largest share of the province’s overall agri-food exports. They are also its most globally competitive agri-food products.

Impact paper  |  45-min read
February 23, 2021

Today’s Statistics Canada release showed that retail sales fell in December, posting their largest decline since April of last year. With provincial governments implementing more stringent lockdown measures throughout the month, the results are hardly surprising. And given that restrictions have mostly remained in place since December, it is likely that retailers continued to be hit hard by the pandemic during the first two months of 2021.

Quick take  |  2-min read
February 18, 2021

The COVID-19 pandemic has taken a massive toll on the global and Canadian economies. The government response has been unprecedented, with a quick rollout of fiscal and monetary policy measures that have bolstered household incomes, supported wages, and provided cheap credit to households and businesses.

Issue briefing  |  15-min read
February 18, 2021

January’s inflation inched up 1.0 per cent on a year-over-year basis, thanks to rising gasoline prices and surging housing prices. We expect that as restrictions ease and economic activity rebounds, inflation will gradually recover over the coming quarters.

Quick take  |  2-min read
February 17, 2021

January’s labour force survey is a mixed bag. It contains some sobering numbers but also signs for cautious optimism. The decline in employment was almost entirely due to the closures in Ontario and Quebec, as other provinces labour markets fared well.

Quick take  |  3-min read
February 5, 2021

Output grew in November, the economy’s seventh consecutive month of growth. While industrial production grew, lockdowns led to declines in services such as arts, entertainment and recreation. Overall, November’s modest pick-up is welcome, yet there is still a long way to go as output remained below the level recorded before the onset of the pandemic in February.

Quick take  |  3-min read
January 29, 2021

Today’s Statistics Canada release showed that retail sales rose in November and are up compared to their pre-pandemic level. Strong gains in household income—due largely to government stimulus throughout much of 2020—encouraged consumers to spend more ahead of the holiday season..

Quick take  |  3-min read
January 22, 2021

Inflation decelerated to 0.7 per cent in December. In all, price inflation was only 0.7 per cent in 2020, the smallest increase since 2009. Tightened restrictions across regions in December significantly weighed on consumer demand for transportation, thus pulling down consumer prices.

Quick take  |  2-min read
January 20, 2021

The Bank of Canada held its policy interest rate steady and announced that it will continue with its quantitative easing program. With core inflation well below its target of two per cent, and a slowdown in the economic recovery over the past few months, today’s announcement was expected.

Quick take  |  2-min read
January 20, 2021

Increasing COVID-19 case counts in the fall have begun to affect the broader economy. Manufacturing sales slowed by 0.6 per cent in November, the second consecutive decline. While only a minor decline, more restrictions through December and January should further restrict economic activity, and thus manufacturing output.

Quick take  |  3-min read
January 19, 2021

Rising COVID-19 cases through the late fall and into winter led to shutdowns across the country, which weighed on employment growth. In all, employment fell in December, the first decline in employment since April. With restrictions remaining in place or even being tightened into 2021, employment growth is likely to decline further in January and remain weak in the first half of the year.

Quick take  |  3-min read
January 8, 2021

The U.S. economy will slowly recover from the devastating effects of COVID-19. By 2023, the gap between potential and actual growth should close. However, there will be lingering effects.

Online experience  |  3-min read
January 7, 2021

Real GDP growth decelerated to 0.4 per cent in October as the second wave of the pandemic drained energy from the recovery. A notable slowdown in manufacturing contributed to this result, as well as a further decline in the accommodation and food services industry.

Quick take  |  3-min read
December 23, 2020

Today’s Statistics Canada release showed that retail sales rose 0.4 per cent in October and are up 4.5 per cent compared to their pre-pandemic level. Strong gains in household income and rock bottom interest rates have allowed retail sales to post a speedy recovery compared to most other sectors of the Canadian economy.

Quick take  |  3-min read
December 18, 2020

COVID-19 hit the Canadian tourism sector harder than any other. Its contraction in the second quarter of 2020 was six times larger than the economy’s as a whole. Tourism’s recovery depends on a widely distributed vaccine, the lifting of public health measures, and a broader economic rebound.

Online experience  |  4-min read
December 16, 2020

The economic crisis caused by the pandemic will leave long-lasting scars for many Canadian industries and take a heavy toll on the finances of governments at all levels. The COVID-19 pandemic has already taken a massive toll on the Canadian and global economies.

Op-ed  |  4-min read
December 16, 2020

The Canadian Beverage Association is trying to help Canadians consume fewer calories from non-alcoholic/non-dairy liquid refreshment beverages (LRBs). The association hopes to reduce the average number of LRB calories each person consumes. Since 2014, the average number of calories Canadians consume from LRBs in a day has fallen.

Online experience  |  8-min read
December 11, 2020

This month’s labour market data shows that the jobs recovery continues to lose steam. While the overall number of employed Canadians grew in November, growth this month is the weakest since the beginning of the recovery in May.

Quick take  |  3-min read
December 7, 2020

Canada needs to diversify its trading partners. The unpredictable trade policies of our southern neighbour over the past few years and the challenges caused by COVID-19 have made this clear. Over 70 per cent of Canadian goods and services exports are destined for the United States. And while this reliance will not wane any time soon, Canada should continue to gradually broaden its reach and diversify into other markets. Japan offers many opportunities.

Impact paper  |  45-min read
December 7, 2020

Real GDP grew in September. These modest figures, as well as a preliminary estimate growth for October, show that escalating cases of COVID-19 and stricter public health measures have weighed heavily on Canada’s economic recovery.

Quick take  |  4-min read
December 1, 2020

Minister Freeland has highlighted the importance of rolling out a vaccine and providing additional support to households and businesses through what will be a tough winter for many Canadians. The additional spending coupled with a lasting negative hit to government revenues will add copiously to the federal debt—boosting the net debt-to-GDP ratio from 35 per cent pre-COVID to around 54 per cent over the medium term.

Quick take  |  3-min read
November 30, 2020

Today’s Statistics Canada release showed that retail sales rose in September. Strong gains in household income—due largely to government stimulus during the pandemic—and historically low interest rates have been encouraging sales of big-ticket items.

Quick take  |  2-min read
November 20, 2020

Housing markets have always mirrored social trends in Canada. The automobile, for example, helped fuel suburban growth in the mid-20th century. A home-ownership tsunami brought on by baby boomers led to a decline in the construction of new rental units in the 1990s. And in the past 20 years, the housing story has been about the growth of our cities, at the cost of small towns and rural communities.

Op-ed  |  5-min read
November 19, 2020

Inflation inched up in October thanks to increases in food and shelter prices. While the demand for clothing, travel and transportation remained suppressed, consumer prices continued to rise because of a pick-up in housing demand and limited supply of product amid the pandemic.

Quick take  |  2-min read
November 18, 2020

With September numbers in, manufacturing sales rebounded in the third quarter, following the sharp decline in the second quarter of the year. Growth was widespread across industries and regions. Higher prices for lumber, coupled with sharp increases in exports of forestry products and building and packaging materials, supported growth in the wood industry while higher sales of pharmaceuticals and medicine amid the pandemic led to higher sales in chemical manufacturing.

Quick take  |  2-min read
November 16, 2020

Physicians provide the invaluable and essential service of delivering health care to Canadians. While health care is often considered in terms of costs to governments and taxpayers, it also generates many economic benefits at the national, provincial/territorial, and community levels.

Issue briefing  |  45-min read
November 10, 2020

In another sign of the resilience of Canada’s recovery, employment rose in October. With shutdowns enacted in some provinces and cases rising in nearly all, this month’s reading should be embraced with some enthusiasm. However, the enthusiasm should be tempered as employment could weaken in November because COVID-19 cases remain high in many provinces.

Quick take  |  2-min read
November 6, 2020

The COVID-19 pandemic has disrupted product shipments and forced many Canadian businesses to adjust their supply chains. For some, this has involved sourcing more inputs from local suppliers. The current economic hardship has also caused a surge of solidarity from Canadians who are supporting businesses by buying locally. But a strategy focused on buying local is not the solution Canada’s economy needs.

Op-ed  |  3-min read
November 4, 2020

Although the precise economic and financial toll of COVID-19 on the economy remains uncertain and depends on how long the crisis lasts, Canada’s health care system is already experiencing significant change and will likely continue to do so over the longer term.

Impact paper  |  55-min read
October 30, 2020

In light of a dim outlook, the Bank of Canada unsurprisingly kept its policy interest rate on hold today, while adjusting its quantitative easing program. The central bank reiterated that the economy is not close to recovering, and that core inflation remains below its 2 per cent target.

Quick take  |  2-min read
October 28, 2020

Forecasters surveyed by The Conference Board of Canada in the autumn have a slightly more optimistic view of the economy’s short-term prospects than they did in summer. Still, the situation remains bleak. Based on responses to the survey, the COVID-19 pandemic and the resulting shutdown of the economy in March and April will result in a decline in real GDP this year.

Online experience  |  2-min read
October 26, 2020

Inflation remained muted in September—prices for gasoline and tourism-related services continue to be the main source of downward pressure. Core inflation held steady, which is below the Bank of Canada’s target. While some consumer products have faced upward price pressure, we expect overall inflation to remain at or below the central bank’s target until mid-next year.

Quick take  |  2-min read
October 21, 2020

As COVID-19 containment measures began to ease after the first wave, business leaders and policy-makers here in Canada and around the world started to think about how to deal with the aftermath of the pandemic. This means finding the right strategies to rebuild their economies and improve supply chain resiliency to future shocks.

Issue briefing  |  11-min read
October 20, 2020
Focus Area—Canadian Economics

With the onset of COVID-19, the already-struggling Canadian manufacturing sector suffered significant declines in March and April. Since then, manufacturing sales have strived toward recovery. However, the latest August decline signals that recovery will have to wait.

Quick take  |  1-min read
October 16, 2020

National employment levels continued their recovery at a stronger pace in September. Employment remained lower than pre-pandemic February in all provinces. Canada has now recovered approximately 2.3 million of the 3.0 million jobs lost during the pandemic.

Quick take  |  2-min read
October 9, 2020

Following a jump in June, real GDP grew in July. This slower pace of recovery is in line with estimates from The Conference Board of Canada’s latest national forecast. While a continued recovery back to pre-pandemic levels of output is promising, real GDP still lies below its February level. With the number of new COVID-19 cases climbing in many provinces, further economic recovery is expected to continue at a much more moderate pace.

Quick take  |  3-min read
September 30, 2020

In a sparsely attended ceremony, Governor General Julie Payette delivered a speech detailing the government’s direction over their remaining mandate. The Speech highlighted a number of programs, targets and measures that address many important issues and challenges facing Canada and Canadians.

Quick take  |  5-min read
September 24, 2020

Canada is fortunate: It has a vast, well-connected network of trails that weave through built and natural environments alike. Trails provide character and access to cities, boost tourism, contribute to mental and physical health, and help relieve stress on the natural ecosystem.

Online experience  |  2-min read
September 21, 2020

In an era of lightning-fast technological change, it’s more important than ever that Canadian leaders understand how the adoption of new technologies will impact Canada’s labour force.

Online experience  |  4-min read
May 28, 2020
Client—Future Skills Centre