Data from Statistics Canada suggests Canada’s economy appears to have suffered its worst year on record. (THE CANADIAN PRESS/Justin Tang)

Data from Statistics Canada suggests Canada’s economy appears to have suffered its worst year on record. (THE CANADIAN PRESS/Justin Tang)

Canada’s economy likely suffered its worst year on record, shrank by 5%: StatsCan

The flash estimate is worse than 1982 when the economy contracted by 3.2 per cent

Canada’s economy appears to have suffered its worst year on record as the national statistics agency’s preliminary estimate showed a contraction of 5.1 per cent in 2020.

The flash estimate, which has yet to be finalized, is worse than 1982 when the economy contracted by 3.2 per cent, which was the worst over the course of six decades of comparable data.

Not even at the height of the global financial crisis just over a decade ago were things as bad as they were last year when the real gross domestic product fell 2.9 per cent in 2009.

Statistics Canada said it expects to finalize the numbers in the coming weeks.

The drop is largely due to steep declines in March and April as large swaths of the economy were shut down during the first wave of the COVID-19 pandemic.

Since then, economic activity has slowly and steadily grown.

Statistics Canada said Friday the economy grew 0.7 per cent in November, marking the seventh straight month of gains after the steep drops in the spring. The growth followed a 0.4 per cent increase in October.

It also came with the backdrop of positive news about vaccines and a presidential election south of the border where Joe Biden defeated Donald Trump.

Stock market activity increased as market sentiments improved, as the finance and insurance sector grew by 1.3 per cent in November.

READ MORE: Canadian economy lost 63,000 jobs in Dec., first decline since April

Mining saw an increase in demand for things like potash and non-metallic minerals. Likewise, the oil and gas sector saw gains as facilities in Alberta restarted production.

The retail sector was up by 1.1 per cent in November, including growth of 6.1 per cent in the food and beverage subsector that Statistics Canada attributes to higher activity in grocery stores, along with a boost in business for beer, wine and liquor stores.

The agency also said its preliminary estimate for December shows growth of 0.3 per cent, even as much of the country headed into heavy restrictions to slow the spread of COVID-19 and jobs were lost.

The preliminary estimate for the fourth quarter shows an annualized growth rate of 7.8 per cent.

CIBC senior economist Royce Mendes wrote that the figures suggest the economy healed more than expected in the final months of 2020.

“That said, the economy will only be able to outrun the second wave of the virus for so long,” Mendes says in a note.

“With unemployment rising in December and public health officials being forced to tighten restrictions even further in January, the situation likely became more dire in the new year.”

Canada

Get local stories you won't find anywhere else right to your inbox.
Sign up here

Just Posted

Port Hardy mayor Dennis Dugas. (Dennis Dugas photo)
Port Hardy mayor advocates for fish farm industry, talks impact on North Island

The Discovery Islands closures will certainly have an effect on Port Hardy, says Dugas.

An Island Health nurse prepares a dose of COVID-19 vaccine. (Photo courtesy Island Health)
Health authority opening 19 clinics to immunize Vancouver Island residents

Health authority anticipates more than 40,000 people will be immunized over the next month

Debra Lynn photo
Mysterious smoke cloud seen in Seavac Centre

Fire crews did a thorough sweep of the centre.

North Island Gazette file photo of Port McNeill council.
Heated conversation occurs at Port McNeill council over policy request

Port McNeill mayor Gaby Wickstrom wants to see a change in the… Continue reading

The Port Alice pulp mill has been dormant since 2015. (North Island Gazette file photo)
The Port Alice pulp mill site is being ‘recycled’

Bankruptcy company is overseeing de-risking the site, water treatment and environmental monitoring.

(The Canadian Press)
‘Worse than Sept. 11, SARS and financial crisis combined’: Tourism industry in crisis

Travel services saw the biggest drop in active businesses with 31 per cent fewer firms operating

(Black Press Media files)
Hosts charged, attendees facing COVID fines after Vancouver police bust party at condo

Police had previously received 10 complains about that condo

Minister of Families, Children and Social Development Ahmed Hussen takes part in an update on the COVID pandemic during a press conference in Ottawa on Tuesday, Oct. 27, 2020. A joint federal and B.C. government housing program announced today aims to help people living in up to 25,000 vulnerable households pay their rent. THE CANADIAN PRESS/Sean Kilpatrick
Federal, B.C. governments announce $517-million rent aid program to help vulnerable

Benefits for those not eligible for B.C.’s Rental Assistance Program or Shelter Aid for Elderly Renters

(BC SPCA)
Is it safe to give your dog some peanut butter? Not always, BC SPCA warns

Some commercial peanut butter ingredients can be harmful to dogs

Cole Moore with one of his sisters, Jasmin Moore. Photo supplied
Vancouver Island man looks to brain surgery for second chance

Fingers crossed that procedure can give Cole Moore a new lease on life after decade of seizures

Health Minister Adrian Dix, front, B.C. Premier John Horgan and provincial health officer Dr. Bonnie Henry arrive for a news conference about the provincial response to the coronavirus, in Vancouver, B.C., Friday, March 6, 2020. Pandemic emergency measures have been in place for almost a year. THE CANADIAN PRESS/Darryl Dyck
B.C. officials plead for patience as 1.7 million COVID-19 calls flood in

Vaccine registration for 90-plus seniors opened Monday

A West Kootenay man died in an avalanche on March 4 while snowmobiling near Mount Payne, which is indicted by the red flag. Illustration: Google Maps
B.C. father of 3 dead after avalanche in West Kootenay

The man was snowmobiling with a group when incident occurred March 4

A health-care worker prepares a dose of the Pfizer-BioNTech COVID-19 vaccine at a UHN COVID-19 vaccine clinic in Toronto on Thursday, January 7, 2021. THE CANADIAN PRESS/Nathan Denette
Vaccine hesitancy decreases in B.C. as mass immunizations set to begin: poll

Two-thirds of British Columbians, and Canadians, would get the vaccine as soon as possible

Most Read