Canada’s real GDP was 12.1% higher in June 2022 than it was two years earlier in June 2020 when the pandemic was weighing particularly heavily on the economy. (All calculations in today’s Owl are based on seasonally-adjusted GDP at annual rates.)

The picture is much less positive when we compare current economic output to the situation before the pandemic began: Canada’s GDP in June 2022 was just 2.3% higher than it was in February 2020. A more typical increase over the same number of months would be around 5.0%.

The change in economic output since the disruptive impact of the pandemic is not, moreover, consistent across industries.

Take support activities for mining and oil and gas extraction: After plummeting during the first few months of the pandemic, real GDP in this sector was 250.3% higher in June 2022 than the same month in 2020. Real output was, however, down by 1.5% compared to February 2020.

Accommodation and food services provides another example: The situation in June 2022 was fundamentally better than two years earlier with output up by 74.6%, but this was only 0.5% above its pre-pandemic level.

Industries doing well compared to their pre-pandemic level of GDP include, for example, professional, scientific and technical services (up by 8.2% in June 2022 compared to February 2020), wood product manufacturing (up by 14.9%), and cannabis (up by 29.1%).

Industries still a fair distance behind where they were before COVID include, for example, printing (-20.7%), transportation equipment manufacturing (-17.9%), and arts, entertainment and recreation (-9.5%).

Even though the growth in Canada’s real output (i.e., taking inflation out of the equation) compared to where we were before the pandemic has been relatively modest, nominal GDP growth has been very strong with growth of around 20%. As a result, the Bank of Canada still has work to do in terms of slowing down the economy by way of even higher interest rates if it wants to get inflation back under control.