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

Amanda Eastwood, Community Connections Coordinator with Shuswap Immigrant Services Society, said the society has received reports of racist comments and actions in Salmon Arm and is working on education, other ways to combat the issue. (Martha Wickett - Salmon Arm Observer)
Working to counter racism in Salmon Arm, Shuswap

Shuswap Immigration Services Society gathers reports on racism in community, looks at remedies

A man wearing a mask against coronavirus walks past an NHS advertisement about COVID-19 in London, Tuesday, Feb. 2, 2021. (AP Photo/Alastair Grant)
92 new COVID-19 cases, no new deaths: Interior Health

The region is reporting 92 cases after the weekend

Shuswap Youth Launch Team members Claire Waite, Abbigail Paetsch, Mikayla Wilkinson, Brynn Gowen and Caillie Hay-Vicars pause for a picture on the day of the Shuswap Youth Launch interactive event, Thursday, Feb. 25. (Contributed)
Shuswap Youth Launch team over the moon with success of interactive event

Salmon Arm youth team invited to apply for $100,000 grant

City council passed resolution in support of an expansion of the licence area at Salmon Arm’s Marionette Winery for the inclusion of a lounge area. (Marionette Winery/Facebook)
City opts out of public hearing for lounge addition at Salmon Arm winery

Marionette Winery expanding licence area to host small gatherings

Langley resident Carrie MacKay shared a video showing how stairs are a challenge after spending weeks in hospital battling COVID-19 (Special to Langley Advance Times)
VIDEO: Stairs a challenge for B.C. woman who chronicled COVID-19 battle

‘I can now walk for six (to) 10 minutes a day’

Pathways Addictions Centre is in jeopardy of closing after Interior Health has pulled all its funding and will be taking over addiction services ‘in house’ as up May 31. (Facebook)
Future of South Okanagan community’s addictions centre in jeopardy after Interior Health pulls funding

Pathways has been in Penticton for over 20 years and has 10 staff, serving around 1,000 people

B.C.’s court of appeal in Vancouver. (File photo: Tom Zytaruk)
Kootenay man appeals 7-year conviction for New Year’s Eve kidnapping, beating

Brandon Coons, 27, was convicted on five charges, including assault with a weapon

An investigation is underway after two VPD officers were recorded posing for pictures near a dead body at Third Beach on Feb. 24. (Screen grab/Zachary Ratcliff)
Vancouver officers placed on desk duty after filmed posing next to dead body

Pair put in ‘non-deployable, admin positions’ as the investigation into their conduct continues

Susan Kootnekoff is the founder of Inspire Law, an Okanagan based-law practice, and provides Kelowna Capital News with weekly stories from the world of local, national and international law. (Contributed)
Kootnekoff: Landmark Human Rights Decision: Francis v. BC Ministry of Justice

Susan Kootnekoff is the founder of Inspire Law, her diverse legal career spans over 20 years

(Black Press file photo)
Homicide team to look into death of 11-year-old Agassiz boy

Agassiz RCMP were called out Friday to assist with a child in medical distress

A publicly accessible defibrillator as well as naloxone and first aid kits are included in a stand that has been installed at Crescent Beach. It is one of two planned for the South Surrey neighbourhood as St. John Ambulance works to install 1,000 of the life-saving devices around the province. (Contributed photo)
St. John Ambulance aims to install 1,000 publicly accessible AEDs across B.C.

Sponsors sought for stands that cost about $8,000 to equip and install

Theodore, Alvin and Simon were found abandoned by a community mailbox, the Vernon BC SPCA said March 1. Now, they're looking for their forever home. (Facebook)
3 guinea pigs found abandoned near Vernon mailbox

Alvin and the pigs are up for adoption through Vernon’s BC SPCA

Most Read