Economy Report Card
How is the Canadian economy doing?
Strong and sustainable economic fundamentals are critical if Canada’s future generations are to achieve meaningful gains in their standard of living.
Key Findings
- In a country comparison, Canada receives a D on the economy report card, ranking 11th among 16 peer countries.
- Performance varies across Canada’s provinces, with the three westernmost provinces outperforming the rest.
- Canada has long lagged behind most of its peers on labour productivity.
- Canada is missing out on the benefits of global economic integration. Despite a lower income per capita than most of its peers, there is relatively low poverty and income inequality in Canada.
Economy Report Card
| Country | Grade | Country | Grade | |||
|---|---|---|---|---|---|---|
| 1 | Netherlands | A | 9 | Finland | C | |
| 2 | Ireland | A | 10 | Austria | D | |
| 3 | Norway | A | 11 | Canada | D | |
| 4 | Denmark | B | 12 | Germany | D | |
| 5 | Belgium | B | 13 | France | D | |
| 6 | Switzerland | C | 14 | Japan | D | |
| 7 | Sweden | C | 15 | U.K. | D | |
| 8 | Australia | C | 16 | U.S. | D |
| Country | Grade | |
|---|---|---|
| 1 | Netherlands | A |
| 2 | Ireland | A |
| 3 | Norway | A |
| 4 | Denmark | B |
| 5 | Belgium | B |
| 6 | Switzerland | C |
| 7 | Sweden | C |
| 8 | Australia | C |
| 9 | Finland | C |
| 10 | Austria | D |
| 11 | Canada | D |
| 12 | Germany | D |
| 13 | France | D |
| 14 | Japan | D |
| 15 | U.K. | D |
| 16 | U.S. | D |
Source: The Conference Board of Canada.
Dimensions of Canada’s Economy Report Card: Latest releases
Read our latest research focused on each of the three dimensions of the Economy Report Card.
Economic Prosperity
This dimension looks at the factors that affect a region’s prosperity: economic growth, employment growth, government debt, income per capita, inflation, investment, labour productivity growth, and unemployment.
Distribution of economic prosperity (forthcoming)
This dimension looks at the economic indicators that help us assess how level the playing field is in Canada and its provinces: the gender wage gap, income inequality, intergenerational mobility, the poverty rate, and wealth distribution.
Global integration (forthcoming)
This dimension looks at four indicators of how Canada’s economy integrates with the rest of the world: inward and outward foreign direct investment and backward and forward integration in global supply chains.
Exploring the economy report card
The economy report card provides a unique assessment of Canada’s performance relative to its peers across 17 indicators organized into three dimensions: economic prosperity, distribution of economic prosperity, and global integration.
Economic prosperity
Economic prosperity is vital to support public services and investments. Canada and most of its provinces perform weakly in this dimension, with low grades on income per capita, economic growth, labour productivity growth, and investment.
Questions we aim to answer:
- Why is economic prosperity important?
- Why is Canada’s economic competitiveness slipping?
- Is Canada’s economy underperforming?
- What should Canada do to improve its economic performance?
- Is Canada’s standard of living falling?
- Why does productivity growth matter?
Economic prosperity indicators
- Economic growth D
- Employment growth C
- Government debt B
- Income per capita D
- Inflation B
- Investment D
- Labour productivity growth D
- Unemployment rate C
Distribution of economic prosperity
Equitable distribution of prosperity enhances social cohesion and economic growth potential. It also leads to better employment prospects, job quality, health outcomes, education, and other opportunities.1 Canada scores Bs and Cs across these indicators, with its worst performance on the gender wage gap.
Questions we aim to answer:
- How does income inequality affect economic growth?
- What is the gender wage gap in Canada?
- How can Canada reduce the gender wage gap?
- Is poverty a problem in Canada?
- Why does income inequality matter?
- What is the current wealth distribution in Canada?
- Has the wealth gap between rich and poor widened in Canada?
- Has the income gap between rich and poor widened in Canada?
Forthcoming
- OECD, A Broken Social Elevator? How to Promote Social Mobility (Paris: OECD, 2018).
Distribution of economic prosperity indicators
- Income inequality
- Intergenerational mobility
- Gender wage gap
- Poverty rate
- Wealth distribution
Global integration
Global integration lets countries access larger international consumer markets, a greater pool of qualified workers, and new technologies and know-how. These connections encourage innovation, lower business costs, and help spur Canadian economic growth.
Canada earns Cs and Ds on the four indicators that measure a country’s integration into global markets.
Questions we aim to answer:
- Is Canada connected to the global economy?
- How has Canada’s participation in global supply chains changed over time?
- Which countries are most globally connected to Canada?
- Does Canada attract enough foreign direct investment (FDI)?
- Does Canada invest in other countries?
- What are the benefits of global integration?
Forthcoming
Global integration indicators
- Backward participation in global supply chains
- Forward participation in global supply chains
- Inward FDI Outward FDI
How can Canadian leaders help?
Improving fundamentals like productivity is the only sustainable way to reduce the widening gap in living standards between Canada and peer countries.
Canada has long lagged behind its peers on labour productivity growth. Here’s how leaders can drive improvement:
Encourage investment in technology and innovation
Motivate businesses to adopt new technologies and invest in R&D through tax incentives, grants and subsidies, procurement policies, updated regulatory standards, and partnerships.
Improve education and skills training
A well-educated and skilled workforce is crucial for productivity growth. Investing in education and training programs like Ontario’s Skills Development Fund will help workers acquire the skills they need for the post-pandemic 21st century.
Promote competition
Fostering a competitive business environment drives innovation and efficiency. Reducing barriers to entry, updating regulations, encouraging foreign investment, and increasing control over mergers are all ways to promote competition. The federal government’s readiness to overhaul Canada’s Competition Act is a positive step.
Promote flexible work arrangements
Offering remote work, flexible schedules, and job-sharing can improve work-life balance, reduce absenteeism, and boost productivity.
Support small business growth
Small businesses drive economic growth and job creation. Policy-makers can help small businesses grow and increase their productivity by offering tax incentives and better access to financing, encouraging exports, promoting innovation, and providing regulatory relief.
Canada trails its peer countries on integration into global supply chains. Here’s how to improve that:
Foster more interprovincial and international collaboration
Reduce interprovincial trade barriers and promote collaboration with international partners to take advantage of emerging opportunities and address global supply-chain challenges.
Manage supply-chain risk through friendshoring
Strengthen Canada’s relationships with our allies to manage supply-chain risk and ensure the security and reliability of critical inputs, particularly in strategic industries like semiconductors.
Enhance market access
Pursue deeper trade relations with Southeast Asian countries as part of Canada’s Indo-Pacific strategy to increase market access and reduce trade barriers beyond existing agreements.
Encourage investment in high-value-added industries
Create a favourable business environment to attract investment in high-value-added industries, boosting Canada’s competitiveness and reducing our dependence on China.
Diversify trade relationships
Foster trade relationships with various countries to reduce Canada’s dependence on any single partner, including the U.S. and China.
Canada ranks 13th among 16 peer countries on the gender wage gap. Here’s how to address this issue:
Improve pay transparency
Require companies to publish gender pay gap data to increase transparency and identify areas that need improvement.
Strengthen equal pay legislation
Strictly implement the federal Pay Equity Act to guarantee equal pay for equal work.
Invest in affordable childcare
Enable more women to participate in the workforce by making high-quality childcare affordable through sustained investments by all levels of government, such as the Canada-Wide Early Learning and Child Care System.
Promote women’s leadership
Encourage women to become leaders through initiatives like the 50–30 Challenge and develop the women’s talent pipeline by expanding senior executive and board member talent pools.2
Encourage gender-diverse hiring and promotion
Promote gender diversity in hiring and promotion processes, set clear targets, and publicly report on diversity and inclusion.
Improve educational attainment
Narrow the gender wage gap by promoting and supporting higher education for women.
- Susan Black, Maria Giammarco, and Margaret Yap, All on Board: Does Disclosure Help Create More Inclusive Boardrooms? (Ottawa: The Conference Board of Canada, 2021), accessed July 31, 2024.
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