In line with its previous forecast, Canada’s economy will have “subdued growth” for the rest of the year with real GDP growth at just 0.6%, according to a report by The Conference Board of Canada. However, a stronger 2.3% GDP growth is expected in 2025.
“Expansion plans within the business sector have stalled, evident by weak growth in investment spending and a cessation in private sector hiring,” Ted Mallett, director of economic forecasting at The Conference Board of Canada, said in a press statement.
“Amid these conditions, recent employment gains have relied heavily on public sector hiring,” Mallett said. “However, what’s more concerning about Canada’s labor market is the collapse of the bottom end of the job market, which saw net zero employment gains in the 15 to 24 age group over the past year.”
The Conference Board of Canada noted that with inflation easing, rate cuts are expected to begin mid-year; until then, high interest rates will continue to dampen consumer and business spending across the provinces.
In Ontario, The Conference Board of Canada noted that net international migration remains strong and is driving enough demand to avoid a steep economic growth. However, growth in Ontario’s finance and real estate sectors will slow, and manufacturing output will be down. Ontario’s GDP growth is predicted to be 0.6% this year. However, it will pick up to 2.3% in 2025.
Quebec’s GDP growth is expected to be just 0.3% this year, increasing to 1.7% in 2025.