- June 11, 2021
- Posted by: Clearport Team
- Categories: Clearport, Employers, General, HCM, Human Capital Management, Immigration Services, Immigration Services, International, Market Development, Student Mobility
And for 2022, leading organizations forecast that Canada’s real Gross Domestic Product (GDP) will grow 3.5% to 3.8%.
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The Canadian economy will bounce back strongly in 2021 and continue to grow at a steady pace in 2022, according to an upgraded national economic outlook by the OECD (the Paris-based Organization for Economic Co-operation and Development) and to the latest provincial economic forecast by the CBOC (Ottawa-based Conference Board of Canada).
This strong economic outlook, more significant than indicated by previous forecasts and expected to varying degrees in all Canadian provinces, will be fueled by the growing rhythm and coverage of COVID-19 vaccination, resulting reductions in COVID restrictions, and increasing activity in both internal and external demand, especially in energy, tourism, and exports. Other contributors to Canada’s economic recovery are the forecasted demand growth spurred by the fiscal package launched in March by the U.S., Canada’s own Federal and provincial economic measures, and higher worldwide prices for key commodities like oil.
There are indications in Canada’s most recent Federal Government Budget that, at least until the country is out of the global health crisis, it may keep in place some programs in support of businesses, families and individuals.
Canada Economic Activity is continuing to recover
very significantly
Source: Statistics Canada and OECD Economic Outlook Database
As the trend to lift public health measures in Canada continues through increased COVID-19 vaccination coverage, the second semester of 2021 is expected to show an expansion of consumer spending, as well as significant improvements in the employment market. Further data from the OECD indicates that Canada’s Gross Domestic Product (GDP) per capita can be expected to recover to pre-COVID figures during the first half of 2022.
Canada Substantial Household Savings set for
Large Increase in Consumer Spending
Source: Statistics Canada and OECD Economic Outlook Database
The Bank of Canada recently reported that household savings across Canada rose to $180 Billion last year.
A report by CIBC (the Canadian Imperial Bank of Commerce) published at the end of 2020 indicated that, in Canada, “Covid-19 has triggered the largest cash accumulation in recorded history. We estimate that households and businesses are currently sitting on no less than $170 Billion of excess cash.”
Moreover, as per a recent Huffington Post article, a poll conducted by Maru/Blue poll for CIBC, shows that Travel ranks first when surveyed Canadians were asked what do they intend to spend those extra savings on. Investing more, continuing to build savings, and paying off debt come as the next priorities, according to the poll.
Source: OECD Economic Outlook 106 and 109 databases.
Canada’s Unemployment Rate continues to decline
Source: OECD Economic Outlook 106 and 109 databases.
Meanwhile, the unemployment rates in Canada continue to decline as more and more Canadians go back to work, as a result of the easing of COVID-19 restrictions, the phasing out of some supports by the Government of Canada, and the uptake in the county’s economic activity.
For Employers in Canada, this means that new shortages in the labor market may be in the horizon, even sooner than expected.
All Provinces in Canada will see Economic Recovery in 2021
Per the latest forecast by the CBOC (Conference Board of Canada), a broad economic recovery is underway across Canada’s provinces.
The think tank based in Ontario, Canada’s largest province, is forecasting a steep bounce-back in real GDP to take place in every province across the country. According to this CBOC forecast report, engines for the rebound will be accumulated demand and cash savings.
Pedro Antunes, Chief Economist at The Conference Board of Canada, said that
“the news of successful vaccines against COVID-19 has provided optimism about ending the health crisis and lifting battered economies all around the world out of the deepest recession in modern times.”
He also indicated that
“consumers will lead the recovery over the second half of 2021 as COVID-19 cases dissipate and economic prospects and consumer confidence improves.”
Even as consumer spending bounces back, this report forecasts that household savings will remain strong in 2021, with an average of approximately $113 Billion or around 5 times the savings hold by households in the four years before COVID-19.
These are the highlights of the 2021 Canada Economic Recovery forecast by province, as reported by CBOC.
Canada’s strong Economic Recovery forecast creates opportunities for Employers, Businesses, Job-Seekers and International Students
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