Photo: Jacques Nadeau Le Devoir
The GDP decline in April is partly due to the closure of the shops ordered by the government to slow the progression of the sars coronavirus.
More undermined than elsewhere in Canada by the containment measures and restrictions related to the pandemic, the quebec economy has hit a historic low in April. GDP contracted by nearly 15 % to return to its 2004 level.
The data of the Institut de la statistique du Québec (ISQ) show a fall of 14.8 % of real GDP in the Quebec city in April, after a plunge of 9.6% in march. “All the major sectors are showing declines while the effects of the COVID-19 were stepped up in April “, summarizes the ISQ, which adds that” as a result of these declines, the GDP for April is at the level of the year 2004 “.
Compared to the canadian average, québec’s economy was felt more severely by the effects of the response to the pandemic. According to Statistics Canada data, the canadian GDP has plunged 11.6 % in April after a fall of 7.5% in march, representing a dip of 4.7 % after four months compared to the same period of 2019, compared to 6.4 % for the one of québec’s GDP.
The construction makes the difference
“The under-performance of the Quebec economy compared to the rest of Canada is explained in part by a collapse of the economy expanded, involving the sectors of construction and resources. For the construction sector, the cumulative decline since February amounted to 59%, while the decline at the national level is less at 27 %. The divergence is also important on the side of the resources sector that shows in Quebec, a decline of 44 % since February, compared to 14 % in Canada, ” writes the economist Kyle Dahms, of the National Bank.
In more detail, the ISQ indicates that the goods-producing industries have recorded a “historical” decline of 25.1% in April, after a decline of 8 % observed in march. “This decline stems mainly from the construction (-54,4 %) and manufacturing (-20,3 %). “For their part, the services-producing industries have seen their business decline of 10.9% in April,after a decrease of 10.2% in march.
“The decrease in April is mainly attributable to the decreases observed in the sectors of retail trade (-24,9 %), transport services and storage (-28,5 %), wholesale trade (-19,8 %) and accommodation and food services (-47,9 %). “
For all of the first four months, the sectors most affected were accommodation and food services (-24,6 %), construction (-13,5 %), educational services (-12,7 %), services to transport and storage (-12,4 %), retail trade (11.7 %) and manufacturing sectors (with-9.5 %), adds the ISQ.
Rebound more strongly expected
If the weight of the fight against the pandemic has been most heavily felt here, the rebound post-containment should be more important. According to provisional estimates from the ISQ, the real GDP of Quebec would have increased approximately 7 % in may, against an increase of 3 % of the canadian GDP provided by Statistics Canada.
“If we look at labour market data for June, including the number of jobs and hours worked, the level of economic activity in Quebec may even already be more close to its peak before the recession than it is in canada,” adds Kyle Dahms.
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