Canadian Real GDP Essentially Flat in May 2022

Statistics Canada (StatsCan) reported today (7-29-22) that real gross domestic product (GDP) was essentially unchanged in May, following a 0.3% increase in April. Growth in services-producing industries of 0.4% was offset by a decline in goods-producing industries of 1.0%. Overall, 14 of the 20 industry sectors tracked reported increases in May.

Advance information indicates that real GDP increased 0.1% in June as output was up in the construction, manufacturing, and accommodation and food services sectors. Decreases were recorded in the mining, quarrying, and oil and gas extraction sector (notably in the oil and gas extraction subsector), in the finance and insurance sector, and in the professional, scientific, and technical services sector.

On a quarterly basis, this advance information for real GDP by industry indicates a 1.1% increase in Q2 of 2022. Owing to their preliminary nature, these estimates will be updated on August 31 with the release of the official GDP data for June and Q2 of 2022.

Looking at the real GDP from just the construction sector reveals that it contracted for a second month in a row, down 1.6% in May. The is the result of many of Ontario’s unionized construction workers being on strike during the month, which caused delays in numerous construction projects.

Residential building construction was down for the second consecutive month, contracting 1.9% in May. Decreases in construction of new single-family detached houses and of apartments as well as in alterations and improvements contributed the most to the decline. Nevertheless, the level of activity in May was more than 11% above the February 2020 pre-pandemic level.

Engineering and other construction activities contracted 2.0% in May, ending uninterrupted growth that began in December 2020. Repair construction (-1.4%) declined for a second month in a row in May, as both the residential and non-residential repair activities contracted. At the same time, non-residential building construction contracted 0.4%, the first decline in six months.