A new analysis from the Conference Board of Canada is predicting that the policy of social distancing will cause the nation’s GDP will fall by 1.1% this year instead of growing by its baseline forecast 0.3%.
The Conference Board also estimated that Canada could lose more than 330,000 jobs over the second and third quarters, which would spike the unemployment rate to 7.7%, and real estate markets will “cool significantly from the frothy activity reported in February, but new home construction is expected to hold up through the downturn.” Resource sector construction, tourism and household services will be particularly hard hit, with the potential of suffering double-digit declines over the quarters, the organisation added.
“These are extraordinary times. Canadian leaders, business owners and households are facing unprecedented uncertainty, said Pedro Antunes, chief economist at The Conference Board of Canada. “If this scenario holds true, we can expect a deeper and longer-lasting hit to the Canadian economy. Still, governments have acted swiftly to mitigate health and economic impacts, once COVID-19 is contained, the economy will rebound.”