Steady growth across all 20 industry sectors increased GDP between 1% to 6% for the months of June, July, and August. The retail, agriculture, utilities, real estate, construction, and finance sectors have recovered the losses since the onset of the pandemic in February, while the oil and gas sector struggles to meet 2017 monthly output levels. The accommodation and food service sectors have seen the most impressive expansion with double-digit growth as the lockdown restrictions were relaxed and consumers felt comfortable with the health and safety protocols.
This growth indicates that Canada is faring quite well after the initial economic shock due to the escalation of the pandemic, but the recent spike in COVID-19 cases indicates the arrival of a second wave fuelling economic concern. In an effort to control the spread, highly populated cities and provinces have been put on red alert and local restrictions have been enforced. While a localized approach is projected to be less damaging to the economy than the strict lockdown policies, the second wave could hinder the economic recovery.
In an effort to continuously aid the economy, legislators passed the Economic Recovery Bill on September 30th which bolsters federal pandemic benefits to aid employment and the economy alike. Although the government’s relief policies should keep the economy afloat, it comes at a cost and will drastically increase the federal deficit.
Canada, like most other countries, has a long recovery ahead of it as the GDP is not expected to fully recover until 2022, but its initial economic rebound and steady growth across most sectors provides a promising outlook post-pandemic.
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Sources: FCIA