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

This Dec. 2, 2020, file photo provided by Johnson & Johnson shows vials of the COVID-19 vaccine in the United States. (Johnson & Johnson via AP)
Interior Health notes 80 new COVID-19 cases over the weekend

108 people in the region have died from the virus

A helicopter hired by Golden Dawn Minerals trails an electromagnetic scanner over Greenwood on Wednesday, March 3. Photo: Submitted
Helicopter flights above Greenwood, rural Grand Forks part of gold mining survey

Results to inform potential explorations by Golden Dawn Minerals, which owns Phoenix and other area mines

Selkirk College’s Tenth St. Campus in Nelson is among the locations where Interior Health will deliver the COVID-19 vaccine within the West Kootenay. Photo: Selkirk College
West Kootenay vaccine locations announced

Interior Health has released a list of places to receive the COVID-19 vaccine

Last week warming temperatures were a concern for Avalanche Canada forecasters, and those trends likely contributed to an avalanche that killed a West Kootenay snowmobiler on Thursday, March 4. Jen Coulter file photo.
Warming trend contributed to Kaslo fatality: Avalanche Canada

Concern for persistent layers has reduced since then

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
Father of 3 dead after avalanche in West Kootenay

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

Third-grader Hudson Adrian (left) on Wednesday, Feb. 24, poses with fourth-graders Josh Hlookoff (centre) and Jaylen Dekteroff at Hutton Elementary’s Pink Shirt Day parade. Photo: Laurie Tritschler
WATCH — Grand Forks’ elementaries support Pink Shirt Day

The annual celebration of kindness puts paid to the idea that bullying was ever cool

Montreal Canadiens right wing Paul Byron (41) fights for control of the puck with Vancouver Canucks defenceman Quinn Hughes (43) during first period NHL action in Vancouver, Monday, March 8, 2021. THE CANADIAN PRESS/Jonathan Hayward
Captain Clutch: Horvat nets shootout winner as Canucks edge Habs 2-1

Vancouver, Montreal tangle again on Wednesday

A special committee has been appointed to look at reforming B.C.’s police act and is inviting the public to make submissions until April 30, 2021. (Black Press media file)
Have thoughts on B.C.’s review of the provincial Police Act?

Submissions will be accepted until April 30

Cottonwoods Care Home in Kelowna. (Google Maps)
New COVID-19 outbreak at Kelowna care home includes fully vaccinated seniors: Henry

Two staff and 10 residents tested positive at Cottonwoods Care Centre

Excerpts from a conversation between Bria Fisher and the fake truLOCAL job. Fisher had signed a job agreement and was prepared to start work for what she thought was truLOCAL before she learned it was a scam. (Contributed)
B.C. woman warning others after losing $3,000 in job scam

Bria Fisher was hired by what she thought was a Canadian company, only to be out thousands

Provincial health officer Dr. Bonnie Henry and Health Minister Adrian Dix provide a regular update on the COVID-19 situation, B.C. legislature, March 2, 2020. (B.C. government)
B.C.’s COVID-19 cases: 545 Saturday, 532 Sunday, 385 Monday

Focus on Prince Rupert, Lower Mainland large workplaces

Rising accident rates and payout costs have contributed to billion-dollar deficits at ICBC. (Comox Valley Record)
B.C. appealing decision keeping ICBC injury cases in court

David Eby vows to ‘clip wings’ of personal injury lawyers

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

Police had previously received 10 complaints about that condo

Most Read