Alberta's GDP plummeted most of all provinces in 2020, while N.W.T. hit hardest in country
Most provinces experienced most severe economic contraction in 40 years after COVID-19 pandemic hit
Alberta saw the largest decline in real gross domestic product in 2020 of all the provinces, while Northwest Territories had the biggest drop in the country as the COVID-19 pandemic hammered every economy, Statistics Canada says.
The real GDP fell in all other provinces as well in 2020, while only two of the territories — Yukon and Nunavut — saw GDP rise, according to Statistics Canada's Gross domestic product by industry: Provinces and territories, 2020 report released Monday.
The figures are preliminary, and final counts won't arrive until November.
Most provinces experienced the most severe economic contraction in 40 years after the COVID-19 pandemic hit starting in spring 2020, pounded by mandatory closures of non-essential businesses, schools and public institutions, travel restrictions, and the shift to more people working from home if they were working at all, Statistics Canada said.
Overall, GDP fell by 5.3 per cent across Canada.
Alberta led the provinces as its GDP dropped 8.2 per cent, driven mostly by plunging demand for oil and gas, which contributed to 2.07 per cent of the overall decline. It marked the fourth annual contraction for the province in 12 years.
"Oil and gas extraction decreased 6.4 per cent as a result of weak demand and a glut of oil on world markets," Statistics Canada wrote.
"Oilsands extraction dropped 5.6 per cent — the first drop for this industry since 2007, when separate estimates for oilsands were first compiled. Support activities for oil and gas extraction were down 40.8 per cent."
Construction, manufacturing, wholesale and retail trade, transportation, health and educational services were all down in Alberta, while crop production — including cannabis — as well as finance and insurance all increased.
Like all provinces and territories, the service sector was down sharply, largely the result of pandemic restrictions.
"We have known for some time, based on lots of other data, that Alberta's economic contraction in 2020 was going to be very large," said University of Calgary economist Trevor Tombe.
"And coming in at a preliminary estimate here of 8.2 per cent means the contraction in 2020 is potentially larger than any other year the province has seen since the 1930s."
Tombe says he can't say for sure, because GDP data is only reliable back to 1981, with fairly reliable estimates as far back as the 1950s. He does say it's the largest contraction for Alberta on record from Statistics Canada data.
Across the country, only the Yukon and Nunavut saw GDP rise — 1.1 per cent and 3.5 per cent, respectively.
Northwest Territories was down 10.4 per cent, although economist Trevor Tombe from the University of Calgary notes its smaller economy was largely affected by temporary closures and disruptions at only two diamond mines.
Alberta's decline, he said, was more broad. But there is one positive.
"The overall level of economic activity per person in Alberta still exceeds every other province in the country," said Tombe.
"So we did drop more, but we went into it in a stronger position and remain in that top place position in terms of GDP per person."
The country at a glance:
- Canada overall: Fell 5.3%.
- Alberta: Fell 8.2%
- B.C.: Fell 3.8%, the largest contraction since the 1982 recession.
- Manitoba: Fell 4.8% in 2020, the largest decline since the series began in 1981.
- New Brunswick: Fell 3.7%, the largest decline since the 1982 recession.
- Newfoundland and Labrador: Fell GDP fell 5.3%.
- Northwest Territories: Fell 10.4%.
- Nova Scotia: Fell 3.2%.
- Nunavut: Grew 3.5%.
- Ontario: Fell 5.0%.
- Prince Edward Island: Fell 3.0%.
- Quebec: Fell 5.3% decrease, larger than the decline from the 1982 recession.
- Saskatchewan: Fell 5.2%, the largest decline since 2009.
- Yukon: Grew 1.1%.