Canada’s economic weakness persists, urgent need to get basics right on growth, productivity, says new report
OTTAWA, MARCH 19, 2024 – Canada’s persistent economic weakness threatens to undermine our future prosperity, says a new report by the Coalition for a Better Future.
In a world of disruption, geopolitical issues, changing climate, affordability concerns and a housing crisis, economic growth must be the top policy priority, says Fragile Growth: An urgent need to get the basics right, released today at the Coalition for a Better Future’s Scorecard Reporting Event.
“We’re not trying to paint a bleak picture. But all these factors underscore the urgent need to get the basics right. We can’t underestimate the task at hand,” says Coalition co-chair Hon. Lisa Raitt.
“There is no panacea to these challenges. It’s incumbent on all of us to look for remedies,” says Coalition co-chair Hon. Anne McLellan. “Economic growth is not an abstract concept only discussed in boardrooms and political circles. It’s the driving force that ensures we can put food on our tables, go to work, take care of our children and seniors and those most vulnerable, and ensure the air we breathe is clean.”
Taking into account 21 economic growth measures with concrete 2030 targets, the report found:
On a per-capita basis, our economy has not only stalled but is contracting. Real GDP per capita has fallen over the past year faster than at any time in at least six decades outside of a recession, and we are producing less per person today than we were in 2018.
Canadian median income from wages adjusted for inflation rose 3.5 per cent during the year, according to the latest income survey data from Statistics Canada. That’s a solid improvement for real incomes – the highest in at least a decade – that more than makes up for the drop in earnings during the 2020 pandemic year.
2.8 million Canadians lived in poverty in 2021. That’s up from 2.4 million in 2020 but down from five million in 2015. Risks to watch going forward are housing insecurity, potential long-term damage of the pandemic on things like educational attainment, as well as the impact of any immediate economic downturn on wages of low-skilled workers.
The share of management positions held by First Nations, Inuit and Métis slipped to 2.4 per cent in 2023, down from 2.7 per cent a year earlier. Women haven’t seen any discernible increase in their share of management positions in years.
As a share of real GDP, business R&D hovered at about 0.6 per cent last year, which has changed little from 2022 but is down slightly from pre-pandemic levels. This remains well below peers like the U.S., whose businesses spend three times as much as we do as a share of the economy.
Growth in Canada’s clean technology sectors has been stalled for years and its share of the overall economy is shrinking. This is a disturbing development.
Canada is at a pivotal moment, Raitt says. “Sooner or later, the nation will be at another defining moment, as a federal election looms. Canadians deserve to have a real debate about where growth will come from. It’s incumbent on all parties to provide concrete ideas on how to improve the living standards for all Canadians – today and in the future. This isn’t about agreeing on specific policy solutions. This is understanding the connection between our individual struggles and lack of economic growth.”
McLellan added: “We are all so busy in our daily lives that we rarely stop to think about how important economic growth is to each of us and our families. And for each of us it means something different. That’s why we need to come together to share ideas around a plan for long-term growth. This is especially important at a time of compounding global crises and while our economy is in transition.”
Committed to action, the Coalition will use our convening power to rally Canadians on this critical question. We want to hear from everyone who sees or feels the impact of slow economic growth, including individuals, charities, clubs, chambers of commerce, community groups and municipalities. Together, we can tackle the obstacles to economic growth head-on.
Read or download the full report at canadacoalition.ca/scorecard-tableau2024.
About the Coalition for a Better Future
The Coalition for a Better Future represents a diverse and growing community of business leaders, community and civic organizations, social policy advocates, youth, Indigenous groups, environmental NGOs and concerned citizens.
We each bring to the table a unique perspective, but we are united in our belief that economic growth is a necessary precondition for job creation, rising incomes, a cleaner environment and a better quality of life.
At the core of what we do is a belief that the decisions we make today as policymakers, businesses, stakeholders and individuals will determine Canada’s level of prosperity for years to come.
For more information or interviews
Lucy van Oldenbarneveld
lvanoldenbarneveld@compassrosegroup.org | (613) 297-8024
