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Canada’s oil and gas extraction sector compared to the auto sector

Canada’s oil and gas extraction sector compared to the auto sector

Posted on: 6/7/2018 | Author: ATB Financial's Economics + Research Team

​​While ordering at a busy food fair in downtown Calgary yesterday, a person in line said that: “the Canadian auto sector is way bigger than oil and gas.” His neighbour in the queue agreed and said: “that’s why we can’t get a pipeline built.”

We don’t know how many Canadians think auto manufacturing is a larger industry than oil and gas or how this plays into their views on new pipeline projects (if there are data out there on this, please let us know!).

What we do know is that oil and gas extraction is the larger of the two industries. In fact, it’s not even close with oil and gas accounting for $114 billion of Canada’s GDP last year compared to $18 billion generated by the auto sector.

That $18 billion is nothing to sniff at, but if the perception is that the auto sector is the lifeblood of the Canadian economy, it’s worth noting that oil and gas extraction produces over six times more economic output.

What’s more, the real (i.e., inflation-adjusted) economic output of the oil and gas sector has been rising in recent years while the growth profile for the auto sector has been relatively flat.

Whatever your thoughts on pipelines, we should all be aware that oil and gas is a major Canadian industry.

Oil and gas, GDP, graph​​​​

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