Canada’s Per Capita GDP Has Now Fallen In Six Consecutive Quarters

InsightSpencerFernando

The country may not officially be in a recession, but most Canadians are falling behind financially.

Is it possible for a country to avoid recession even as most people get poorer?

The government would like you to think it can’t happen.

After all, it seems almost intuitive that if the country as a whole has a growing economy, most people would be better off.

Unfortunately for Canadians, that’s not the case.

Because how a national economy grows matters.

If growth takes place because productivity is rising, then most people will indeed be better off. As just one example, if we learn how to be 10% more efficient building cars, we can build more cars with the same amount of resources and thus generate more overall value.

But that’s not the kind of growth Canada is experiencing.

Instead, our economy is ‘growing’ for one reason and one reason only:

Our population is rising fast.

If you fill up a country with more and more people, you will generally get more economic activity over time.

More people means more demand for products, more demand for employment, more demand for infrastructure, housing, etc.

But if the economy can’t keep up with that demand, if the supply grows at a rate slower than the population increase, then less value is being created on a per person basis.

If a country tripled in population while doubling the raw size of their economy, they would have a much larger economy but most people would be way worse off.

And that brings us to Canada’s ongoing per capita GDP decline.

The personal recession

The charts say it all. Canada’s per capita GDP has now fallen for six consecutive quarters:

“*NEW* Canada’s GDP grew by 1.1% between the 4th quarter of 2022 and 2023, while its population grew by 3.2%. That means GDP per capita is now falling at 2% annually (roughly the difference). Zero economic growth in more than 6 years.”

“Trudeau setting all kinds of records.

NEGATIVE REAL GDP PER CAPITA GROWTH FOR 18 CONSEQUTIVE MONTHS.”

Canada is getting poorer.

We are going backwards.

Remember, there are many poor countries with economies that are massive in the aggregate.

Pakistan has a GDP of $348 billion USD, while Estonia has a GDP of $37 billion USD.

But Estonia has a population of just 1.3 million, giving them a per capita GDP of nearly $28,000 while Pakistan’s per capita GDP is just $1,500 per person given their population of 231.4 million people.

Which country has a higher quality of life?

Which country would people prefer to live in if given the choice?

The answer is obvious.

And so, for the Canadian government to try and trumpet Canada’s ‘economic growth’ when that growth is only happening because our population is surging represents a complete detachment from common-sense and a complete disregard of sound economic policy.

In poll after poll, Canadians say they think Canada is in a recession, and that’s because – on a person by person basis – we are.

The majority of Canadians are getting poorer, and extremely high immigration levels are only exacerbating that trend.

This is the big issue the next government must address.

The tax and spend policies of the Liberals, and their hostility to the energy sector that we depend upon (affordable energy is the foundation of civilization itself), must be replaced with policies that incentivize investment, lower the cost of doing business, and unleash the full power of Canadian energy.

Then and only then will Canadians escape our personal recession and get back to per capita growth.

Spencer Fernando

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