Canada’s economy was slowing down even before the COVID-19 pandemic hit, new data from Statistics Canada suggests.
The data agency says Canada’s gross domestic product was essentially unchanged for the month, as output slowed in the education, transportation and warehousing sectors.
February’s slowdown followed three straight months of slight gains in the months preceding it.
Rotating strikes by teachers in Ontario contributed to a 1.8 per cent contraction in educational services while the transportation sector shrank by 1.1. per cent as some rail traffic was halted across the country on account of protests and rail blockades in support of Wet’suwet’en hereditary chiefs who opposed a natural gas pipeline slated to pass through their traditional lands in British Columbia.
Manufacturing also shrank, by 0.2 per cent.
“Factors that limited growth back then … look like rounding errors next to StatCan’s [March forecast] showing a record nine per cent decline in March GDP,” Royal Bank economist Josh Nye said.
Outside of those sectors, most parts of the economy eked out gains. Real estate was a strong point, as activity at brokerages grew by 5.9 per cent, the biggest monthly gain since 2017. Realtors say the spring housing market was on track to be a hot one before COVID-19 hit, throwing the industry into a deep freeze.
The mining, quarrying and oil and gas sector also had a good month in February, expanding by 0.9 per cent.
Wholesale trade, finance and insurance and the retail sector all grew.
While the numbers were basically flat for the month, the economic carnage that has come since then make the numbers largely redundant.
“Real estate has gone from running hot to virtual stasis in less than a month’s time, and the necessary hit to sectors like accommodation and food services and arts, entertainment and recreation will be historically unprecedented,” Toronto-Dominion Bank economist Brian DePratto said of the February data,
“Fortunately, with economic re-opening plans starting to take shape across the country, there is a little bit of light beginning to form at the end of the tunnel.”
In a preliminary estimate for March released earlier this month, the agency said the economy posted a nine per cent decline for the month as business came to a standstill because of measures taken to slow the spread of the novel coronavirus.
The official estimates of GDP for March and the first quarter of 2020 will be released on May 29.