Canada’s Economy Had ‘Rare’ Economic Retraction in 2023 Despite Absence of Recession: Report

Canada’s economy experienced an economic retraction in 2023 that is “extremely rare” outside a recession, while at the same time the country sustained record-breaking population growth, according to a report by National Bank Financial. “Third-quarter GDP data came in below economists’ consensus expectations, showing outright contraction, notably due to a drop in private domestic demand,” said the report’s authors. “Consumption stagnated for the second quarter in a row, a stinging setback in the current demographic context characterized by record population increases.” The report said Canada’s GDP per capita contracted by 4.4 percent during the third quarter of 2023, whereas the bank’s economists had previously estimated a 2.4 percent contraction. The authors also found that over the past year, company profits have fallen by 22.4 percent compared to workers’ compensation rising by 6.8 percent, which may lead to companies “facing difficult decisions that could result in a reduced appetite for hiring and, in some cases, job losses.”...