The Canadian economy shrank in the first three months of this year, Stats Can reported today. GDP was down 0.1 percent—the first decline in almost five years. It suddenly just got a lot harder to shake the feeling that we’re headed for a recession.
Canada’s shrinking economy comes thanks to “widespread cutbacks” in manufacturing, especially in the auto industry, said Stats Can. No surprise there. Manufacturers have been complaining for months now that they’ve been haunted by the economic storm brewing in the United States.
That’s not all. Imports and exports are both falling. So is personal spending. Home sales have been steadily declining for months. The economy is still adding jobs, but the number of hours being worked is falling. There really isn’t much good news to be found here.
It may be time to put to rest the idea that all that oil wealth in Alberta will save us. High oil prices do very little to help Ontario, the most populous province. Same for Quebec. (Those provinces import much of their oil from the Middle East anyway). So for all of you who aren’t wealthy rapacious oilmen, brace yourselves.