Canada Day: What Makes Our Economy Tick

Learn more about our economy for Canada Day 2013

Canada is a country literally built on extracting and exporting commodities. Natural resources still play a big role in our economy, but other industries have also developed and flourished to give the country and enviably diversified financial standing.

The CIA World Factbook – a journalists’ go-to source for background info on obscure countries – describes our nation as “an affluent, high-tech industrial society in the trillion-dollar class,” adding that “since World War II, the impressive growth of the manufacturing, mining, and service sectors has transformed the nation from a largely rural economy into one primarily industrial and urban.”

Tim-ber!

As much as we’d like to thing we’ve grown as a country, Canada’s economy still relies quite heavily on natural resources extraction. Natural Resources Canada’s lumber export stats for 2012 tally 34.6 million cubic metres of lumber sent abroad, with the vast majority (65 per cent) headed to the U.S. All that lumber brought in $5.7 billion to Canadian coffers.

The Mining Association of Canada’s 2012 Facts + Figures report tallies 320,000 workers employed in mining across the country, contributing $35.6 billion to the country’s GDP. In fact, cumulative mining exports accounted for nearly a quarter (22.8 percent) of the value of all Canadian exports in 2011.

In the past, boom province Alberta could thank most of its success to the continued growth of the oil industry, particularly the now-viable extraction of tar sands oil.

Automation For The Nation

The auto industry has been a key segment of the Canadian economy for more than a century. According to Statistics Canada, 115,000 Canadians work in automotive manufacturing, accounting for nearly eight per cent of all manufacturing jobs in the country. Combined, they produce more than two dozen different models, under 13 different manufacturers’ names, from the Acura CSX to the Volkswagen Routan. And the sales of those vehicles and related accessories totaled $82.6 billion in 2012.

Bank On It

During the 2008 financial crisis, while many banks around the world folded or sought federal bailouts, not one Canadian bank faced similar troubles. The man given much of the credit for Canadian banks’ stability, former Bank of Canada Governor Mark Carney, has since been lured across the pond to head the Bank of England. Still, for the past five years, the Canadian bank industry has been recognized as the “soundest” on the planet by the World Economic Forum. Employing 275,000 Canadians, the industry cumulatively accounts for $53 billion of national GDP. And the industry is steadily expanding beyond our borders. TD Canada Trust, for one, has made expansive inroads into the northeastern United States. Canuck sports fans will smugly note that the Boston Bruins and Celtics play out of the TD Garden. The financial giant has also purchased naming rights for a number of other college and minor league sports facilities.

Cultural Commodities

Despite CBC host George Strombolopolous’ failure to garner an audience during his summer stint on CNN, Canada has a long history of exporting pop culture characters to the U.S. and abroad. One of the original Hollywood stars, Mary Pickford, may have been known as “America’s sweetheart,” but she was born in Toronto in 1892. And there have been so many Canadian-born celebs on U.S. airwaves (John Candy, Martin Short, William Shatner, Alex Trebek, Lorne Greene, and so on) that in 1995 the CBC and HBO coproduced a mockumentary on the subject called The Canadian Conspiracy, long before Jim Carrey, and the Kids in the Hall became cross-border household names.

And, love ‘em or hate ‘em, some of the biggest pop stars in the world, from Celine Dion to the Biebs, hail from Canada, and bring bags of foreign currency with them when they return home at the end of their latest tours.

Canada’s Top Economic Risks

The Bank of Canada, our nation’s central bank and provider of monetary policy, has been lauded for weathering the 2008 global financial crisis like a champ. Now, as new economic threats descend upon our nation, their guidance proves more important than ever. Perhaps the most pressing is the the prolonged drop in oil prices, which lost over 40 per cent of their value as of summer 2014. The BoC responded with a 25 per cent cut to interest rates in January, and could be poised to move again in the near future.

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