The Council decided on August 9 to declare an end to the recession that began in March 2020. It judged that the recovery from the recession is now prolonged and sustained enough to declare that the trough of the recession occurred in April 2020, making this the shortest and deepest recession since the Great Depression that began in 1929.
In March and April 2020, there were unprecedented falls in economic activity. April GDP was 17.7 percent below its level in February 2020. The Council declared on May 1, 2020, that Canada entered a recession in the first quarter of 2020, with February 2020 marking the peak of the previous business cycle expansion.
Since May 2020, Canada has experienced broad economic growth, both in terms of real GDP and employment. The growth in GDP was uninterrupted until a two-month decline in April and May 2021. However, the June 2021 flash estimate indicates a resumption of growth with a 0.7 percent rebound, which would put second-quarter GDP growth at 0.6 percent (or 2.5 percent at an annualized rate). Employment, which has experienced more fits and starts since May 2020 due to lockdowns, saw robust growth in June and July 2021.
Growth has also been broad-based, with the C.D. Howe Institute’s diffusion index above 65 in each quarter since, and including, Q3 2020. This indicates a broad preponderance of sectors of the economy expanding versus in decline.