Canada living standards falling behind rest of developed world

From the Fraser Institute

By Alex Whalen, Milagros Palacios, and Lawrence Schembri

On Canada Day, Deputy Prime Minister Chrystia Freeland proclaimed that “Canada is the best country in the world,” yet Canadians are getting poorer relative to their peers in many other countries and our living standards are falling. This trend is expected to continue well into the future, unless our policymakers make significant changes.

Economists often measure living standards by real gross domestic product (GDP) per person—in other words, the inflation-adjusted monetary value of what a country produces in goods and services divided by its population.

As noted in a new study published by the Fraser Institute, from 2002 to 2014, Canada’s GDP per-person growth roughly kept pace with the rest of the OECD. But from 2014 to 2022, the latest year of available comparable data, Canada’s annual average growth rate declined sharply, ranking third-lowest among 30 countries over the period. Consequently, in dollar terms, Canada’s GDP per person increased only $1,325 during this time period, compared to the OECD average increase of $5,070 (all values in 2015 U.S. dollars).

Moreover, between 2014 and 2022, Canada’s GDP per person declined from 80.4 per cent of the U.S. level to 72.3 per cent, and lost substantial ground to key allies and trading partners such as the United Kingdom, New Zealand and Australia.

And according to OECD projections, Canada will have the lowest projected average annual growth rate of GDP per person (at 0.78 per cent) from 2030 to 2060 when our GDP per person will be below the OECD average by $8,617. This represents a swing of more than $11,000 from where it was in 2002.

Why is this happening?

Several reasons, including historically weak business investment over the past decade, a substantial shift in the composition of permanent and temporary immigrants towards those with less education and fewer skills, and subdued technological innovation and adoption. These factors have combined to produce very low or negative labour productivity growth due to weak growth in the education and skills of the average worker and the amount of capital (namely plant, machinery and equipment) per worker.

While most advanced countries are experiencing similar trends, the situation in Canada is among the worst. Consequently, our relative decline in living standards grows exponentially because Canada’s poor performance compounds over time.

To break out of this rut and prevent this further decline in Canada’s living standards relative to our peers, policymakers must enact comprehensive and bold policy changes to encourage business investment and innovation, promote worker education and training, and achieve better immigration outcomes where more is not always better.

As a starting point, governments should improve the climate for business investment and for investment in education and training by streamlining regulation and major project approvals and reducing current and expected future tax burdens on firms and workers.

Levels of government debt and debt interest costs are approaching thresholds of unsustainability not seen since the 1990s. Governments, including the federal government, must exercise spending restraint to put their finances on a more sustainable path to mitigate the “crowding out” effects of government spending and debt in private markets, and thereby promote private investment. In addition, policies that liberalise intra-provincial and international trade and foster more competition, especially in key industries (e.g. transportation, communication, finance) would help boost investment, productivity and living standards.

Because GDP per person is so closely connected to incomes and living standards, Canada’s decline relative to our peer countries on this key metric should concern all Canadians. Given Canada’s projected continued poor performance, our country needs a major series of policy reforms to avoid further declines in living standards.

Authors:

Alex Whalen

Director, Atlantic Canada Prosperity, Fraser Institute

Milagros Palacios

Director, Addington Centre for Measurement, Fraser Institute

Lawrence Schembri

Senior Fellow, Fraser Institute

Related Topics:#AlexWhalen #CanadianLivingStandards #FraserInstitute #LawrenceSchembri #MilagrosPalacios

Up Next

UK High Court upholds ban on puberty blockers for children, rejects LGBT activists’ challenge

Don't Miss

Conservatives Cancel the Cancellers

Todayville

Todayville is a digital media and technology company. We profile unique stories and events in our community. Register and promote your community event for free.

Follow Author

Just 12% of Albertans have taken latest COVID shot, data show

Censorship Industrial Complex / 7 hours ago

UNESCO’s New Mission: Train Influencers About Combatting Online “Misinformation”

Censorship Industrial Complex / 8 hours ago

New FCC Chairman Vows to End Big Tech’s Grip on Free Speech

Business

Canada Scrambles To Secure Border After Trump Threatens Massive Tariff

Published on December 2, 2024

Todayville

From the Daily Caller News Foundation

By Jason Hopkins

The Canadian government made clear its beefing up its border security apparatus after President-elect Donald Trump threatened to impose sweeping tariffs against Canada and Mexico if the flow of illegal immigration and drugs are not reined in.

Trump in November announced on social media that he would impose a 25% tariff on all products from Canada and Mexico unless both countries do more to limit the level of illicit drugs and illegal immigration entering into the United States. In response, Canada Prime Minister Justin Trudeau met with the president-elect at his residence in Mar-a-Largo and his government has detailed what more it’s doing to bolster immigration enforcement.

“We got, I think, a mutual understanding of what they’re concerned about in terms of border security,” Minister of Public Safety Dominic LeBlanc, who accompanied Trudeau at Mar-a-Largo, said of the meeting in an interview with Canadian media. “All of their concerns are shared by Canadians and by the government of Canada.”

“We talked about the security posture currently at the border that we believe to be effective, and we also discussed additional measures and visible measures that we’re going to put in place over the coming weeks,” LeBlanc continued. “And we also established, Rosemary, a personal series of rapport that I think will continue to allow us to make that case.”

Trudeau’s Liberal Party-led government has pivoted on border enforcement since its first days in power.

The Royal Canadian Mounted Police (RCMP) — the country’s law enforcement arm that patrols the border — is preparing to beef up its immigration enforcement capabilities by hiring more staff, adding more vehicles and creating more processing facilities, in the chance that there is an immigration surge sparked by Trump’s presidential election victory. The moves are a change in direction from Trudeau’s public declaration in January 2017 that Canada was a “welcoming” country and that “diversity is our strength” just days after Trump was sworn into office the first time.

While encounters along the U.S.-Canada border remain a fraction of what’s experienced at the southern border, activity has risen in recent months. Border Patrol agents made nearly 24,000 apprehensions along the northern border in fiscal year 2024 — marking a roughly 140% rise in apprehensions made the previous fiscal year, according to the latest data from Customs and Border Protection.

“While a change to U.S. border policy could result in an increase in migrants traveling north toward the Canada-U.S. border and between ports of entry, the RCMP now has valuable tools and insights to address this movement that were not previously in place,” read an RCMP statement provided to the Daily Caller News Foundation. “New mechanisms have been established which enable the RCMP to effectively manage apprehensions of irregular migrants between the ports.”

Trudeau’s pivot on illegal immigration enforcement follows the Canadian population growing more hawkish on the issue, public opinion surveys have indicated. Other polls also indicate Trudeau’s Liberal Party will face a beating at the voting booth in October 2025 against the Conservative Party, led by Member of Parliament Pierre Poilievre.

Trudeau’s recent overtures largely differ from Mexican President Claudia Sheinbaum, who has indicated she is not willing to bend the knee to Trump’s tariff threats. The Mexican leader in November said “there will be a response in kind” to any tariff levied on Mexican goods going into the U.S., and she appeared to deny the president-elect’s claims that she agreed to do more to beef up border security in a recent phone call.

Trump, who has vowed to embark on an incredibly hawkish immigration agenda once he re-enters office, has tapped a number of hardliners to lead his efforts. The president-elect announced South Dakota Gov. Kristi Noem to lead the Department of Homeland Security, former acting Immigration and Customs Enforcement Director Tom Homan to serve as border czar and longtime aide Stephen Miller to serve as deputy chief of staff for policy.

Economy

Trudeau’s Economic Mismanagement Exposed: GDP Report Reveals Alarming Decline in Canadian Prosperity

Published on November 29, 2024

Todayville

Dan Knight

The latest “Gross Domestic Product, Income, and Expenditure: Third Quarter 2024” report highlights six consecutive declines in GDP per capita & collapsing business investment

Good evening my fellow Canadians, and welcome to the final chapter of Canada as a thriving economy, brought to you courtesy of Justin Trudeau. The latest GDP report isn’t just a spreadsheet of bad news—it’s a grim look at the devastation Trudeau has unleashed on Canada’s economy.

Here’s what they won’t tell you: while Trudeau prances around on the world stage, preaching about climate change and “equity,” the average Canadian is getting poorer. GDP per capita—one of the most telling measures of prosperity—has now declined for six consecutive quarters, hitting levels not seen since 2017. Let that sink in. Under Trudeau’s leadership, Canadians are worse off today than they were seven years ago.

Canada’s GDP Growth: A Sluggish Economy Falling Behind

The latest figures from Statistics Canada’s Gross Domestic Product, Income, and Expenditure: Third Quarter 2024 report show an economy struggling to find its footing. Real GDP grew by 0.3% in Q3 2024, a slowdown from the 0.5% growth in the first and second quarters of the year. On an annual basis, GDP growth for 2023 was a modest 1.1%, further highlighting Canada’s weak economic momentum.

In real terms, Canada’s GDP as of Q3 2024 stands at $2,419,572 million (chained 2017 dollars). While the economy continues to expand, this growth pales in comparison to the nation’s surging population.

GDP Per Capita Declines: A Warning Sign for Canadians

Canada’s economic growth is not keeping pace with its rapid population expansion. In Q3 2024, GDP per capita—arguably the most important measure of economic health—declined by 0.4%, marking the sixth consecutive quarterly drop. With a staggering 3.2% population growth in 2023, Canada’s economy cannot sustain the same level of prosperity for its citizens.

Current GDP per capita is estimated at ~$54,000, down from its pre-pandemic high of ~$58,100 in 2017, and 2.5% below 2019 levels. To return to its long-term trend, GDP per capita would need to grow at an ambitious 1.7% annually for the next decade, a rate well above the recent average of just 1.1% per year since 1981.

Historical Context: Long-Term Prosperity Eroded

The report shows a troubling trajectory in inflation-adjusted GDP per capita over decades:

1981: ~$36,900
2017: ~$58,100
2024: ~$54,000 (estimated due to consecutive declines).

Despite Canada’s resource wealth and economic potential, GDP per capita remains 7% below its historical growth trend, signaling systemic productivity and investment issues.

Key Drivers of GDP Growth in Q3 2024

The Q3 2024 report highlights the components influencing GDP growth:

Household Spending: +0.9%
Government Spending: +1.1%
Business Investment in Machinery and Equipment: -7.8%
Exports: -0.3%
Imports: -0.1%

While household and government expenditures provided some lift, the steep decline in business investment—down nearly 8%—and weaker exports reveal structural weaknesses in Canada’s economic model.

A Warning for the Future

These numbers tell a grim story: Canada’s economic growth, when adjusted for its population explosion, is failing to provide real benefits to its citizens. GDP per capita declines, stagnant productivity, and plummeting business investment highlight the challenges ahead. Without dramatic improvements in productivity, competitiveness, and fiscal policy, Canada’s long-term economic prospects remain precarious.

Trudeau’s Population Bomb

In 2023, Canada’s population grew by a jaw-dropping 3.2%, adding over 1.27 million people—the size of Calgary—in just one year. Trudeau’s open-door immigration policy is out of control. But here’s the kicker: the economy isn’t keeping up. GDP growth is crawling at 0.3%, while GDP per capita—the number that actually reflects living standards—has fallen 2.5% below pre-pandemic levels.

What does this mean? Trudeau is creating a country where there are more people, but less wealth to go around. He’s importing voters for his political base while ignoring the basic economics of supply and demand. More people mean more pressure on housing, healthcare, and infrastructure—all of which are already in crisis. Trudeau gets the photo ops, and Canadians get poorer.

Productivity? What’s That?

Here’s the real scandal: Canada’s productivity is collapsing, and Trudeau couldn’t care less. Business investment in machinery and equipment—a cornerstone of economic growth—dropped 7.8% in Q3 2024. That’s not a blip. It’s part of a long-term trend.

Under Trudeau, Canada has become hostile to business. With punishing taxes, endless red tape, and policies designed to appease radical activists, companies have stopped investing. They’re pulling back because they see no future in a country run by a trust-fund prime minister who treats the economy like his personal virtue-signaling playground.

Exports Collapse, Government Spending Soars

Exports fell 0.3% this quarter, after a 1.4% drop the quarter before. That’s Canada losing its competitive edge, plain and simple. While Trudeau waxes poetic about “green transitions,” other countries are eating Canada’s lunch.

Meanwhile, Trudeau’s solution to every problem is predictable: throw money at it. Government spending rose 1.1% in Q3 2024, marking the third consecutive quarterly increase. But this isn’t investment—it’s waste. It’s billions spent on flashy programs that do nothing to address Canada’s fundamental economic problems.

The OECD Warning Trudeau Ignores

Here’s a fact Trudeau won’t tweet about: The Organization for Economic Co-operation and Development (OECD) projects that Canada will have the lowest GDP per capita growth of all member countries through 2060. That’s Trudeau’s legacy: turning Canada into the slowest-growing economy in the developed world.

This isn’t just incompetence—it’s deliberate. Trudeau’s agenda isn’t about making Canada prosperous; it’s about centralizing power. His policies crush the middle class, drive businesses out, and create dependence on government handouts.

The Final Verdict

Justin Trudeau has managed to take one of the most resource-rich, opportunity-filled countries in the world and drive it into economic stagnation. He’s turned Canada into a welfare state for the many and a playground for the elite. GDP per capita is falling, productivity is collapsing, and the future looks bleak for ordinary Canadians.

Let’s be clear: Trudeau doesn’t care. As long as he’s jet-setting to global conferences, virtue-signaling about climate justice, and securing his legacy as the darling of the global elite, the suffering of everyday Canadians is irrelevant to him.

Canada deserves better. It deserves leadership that values hard work, economic freedom, and the dignity of a prosperous nation. And until Trudeau is gone, don’t expect any of that.

The Opposition is supported by our readers.

Please consider subscribing to receive our posts and support our work.

Subscribe to The Opposition with Dan Knight .

For the full experience, upgrade your subscription.