Subscribe to Canada Free Press for FREE

Why the American Economy is hot, and Canada’s is not

Macdonald Laurier Institute image

By —— Bio and Archives June 22, 2018

Comments | Print This | Subscribe | Email Us

Why the American Economy is hot, and Canada's is not
OTTAWA, ON--With an increasingly favourable business environment in the US and the opposite trend occurring in Canada, business investment in the US is improving faster than in Canada, Munk Senior Fellow Philip Cross said today upon release of the Macdonald-Laurier Institute’s latest Quarterly Economic Report.

Amidst growing uncertainty over the NAFTA negotiations, firms are continuing to shift investment to the US.  The result has been the slowing of consumer spending in Canada and a 50,000-person drop in employment during the first three months of the year.

“The return of the Canadian economy to sluggish growth is projected to continue,” writes Cross. “While the oil industry has recovered, this has been offset by continued weakness in non-energy exports and a marked slowdown in housing.”

With lagging business investment, trade uncertainty, and a cooling housing market, Canada’s real GDP growth eased to 0.3 percent in the first quarter of 2018. This is despite higher levels of government borrowing and spending.

Cross notes that Canada’s poor performance has contrasted against a booming American economy.

“The US added nearly one million new jobs, with unemployment having fallen to 3.8 percent,” writes Cross. “This can be compared with a 4.8 percent unemployment rate in Canada, with job losses being particularly noticeable in British Columbia and Ontario.”

Macdonald Laurier Institute -- Bio and Archives | Comments

Canada’s only truly national public policy think tank based in Ottawa. MLI is rigorously independent and non-partisan, as symbolized by its name. Sir John A. Macdonald and Sir Wilfrid Laurier were two outstanding and long-serving former prime ministers who represent the best of Canada’s distinguished political tradition. A Tory and a Grit, an English-speaker and a French-speaker, each of them championed the values that led to the creation of Canada and its emergence as one of the world’s leading democracies and a place where people may live in peace and freedom under the rule of law.