But, light at the end of the tunnel for 2021
The Conference Board of Canada, a non-profit economic think tank, has released its spring outlook of preliminary economic forecast for provinces.
It’s not good.
The report says the country is in “the worst economic downturn it has seen in decades”.
Echoing that is a survey by Bloomberg Nanos which shows consumer confidence in a telephone survey of households resulted in the lowest rating since they began such polling in 2008.
This graphic shows how real estate sales tumbled in Toronto’s central 416 area code as the epidemic took hold. The steep decline in the graph is similar in many ways to car sales, unemployment levels and other sectors of the economy (Scott Ingram)
A weekly survey of 250 households a four week study of 1,000 responses, shows four out of five (79%) believe the economy will worsen over the next six months. The previous high was 57 per cent in 1008. Just under 37 per cent also said their personal finances had worsened, also a record with just over 22 per cent expressing some degree of worry about job security.
The Conference Board meanwhile notes that the gross domestic product for Canada declined five percent in the first quarter but says in this quarter that could hit a 25 per cent decline. The previous largest decline in the past six decades was in the first quarter of 2009 at 8.7 per cent.
Oil producing provinces like Alberta and Newfoundland have been hit hard by COVID and an oil production spat between Russia and Arabia. Prince Edward Island which benefits from tourism is hit by travel restrictions and closures (Larry MacDougal- CP)
Provincially in all cases there will be a decline in productivity and increase in unemployment although due to slightly different situations.
In spite of the gloom however for 2020 and a 4.3 GDP declin, there is a prediction that the economy will rebound fairly quickly in 2021 on the presumption that a vaccine is found soon and people begin to be rehired. Government financial aid programmes to individuals and businesse, although increasing the deficit to some $125, is also indicated as a help to the eventual restart of the economy. The prediction is for a six percent rebound in GDP next year.
- additional information-source
- Globe newswire: Apr 15/20: Conference Board press statement
- Conference Board of Canada: Sharp, Deep Unprecedented: provincial outlook 2020 spring forecast
- Mortgage Broker News: E Vecina: Apr 15/20: Consumer confidence is showing unprecedented decline
- Bloomberg BNN: T Argitis: Apr 14/20: Housing concern sends consumer confidence to new low
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