As one of the wealthiest countries in the world, the Canadian Economy is dominated by strong service industries and abundant natural resources. Canada is one of the most educated countries in the world. Many industries have relocated to large parts of the country where skilled labor and affordable resources are plentiful.
The Canadian Economy has grown 3.5% over the past three quarters. This growth rate was not typically seen since the good old days before the Great Recession of 2008-2009. Quebec just hit its lowest unemployment rate on record. Nationwide, employment today is 1.8% higher than it was a year ago, well ahead of population growth.
Canada has a private-to-public (crown) ratio of 60:40 and one of the world’s highest levels of economic freedom as a country under the British crown. Let’s take a closer look at the Canadian Economy and its structure.
Canada has three major industries: services, manufacturing, and natural resources. A skilled workforce becomes necessary as these sectors grow and develop.
The service industry is dominant in Canada, employing three-quarters of the population. Other important industries are transportation, wood, paper, minerals, natural gas, fish, and chemicals.
The country is one of the major producers of natural minerals such as gold, nickel, aluminum, and crude oil. Canada has the second largest oil reserves in the world.
Through immigration, the Canadian industry employs many foreign-trained skilled and semi-skilled workers. Working and living in Canada as a skilled or semi-skilled worker gives you the opportunity to apply for permanent residency in Canada. This means that you and your family will live and settle in Canada.
The construction industry recorded an average annual wage bill increase of 3.4% between 2010 and 2015, driven by strong growth in mechanical engineering and residential and commercial construction.
Employment activity has declined slightly over the past 18 months due to a slowdown in industrial and commercial construction and lower demand for drilling activity. However, in the future, the demand for engineers will increase more and more due to the increase in public infrastructure projects.
The 2.4% rise in annual income was due to a weaker dollar, with more Canadians vacationing at home, attracting foreign tourists and boosting tourism. Lower gas prices also boosted consumer spending, which will continue to trend toward self-service over full-service restaurants.
Professional, technical and scientific services.
Average wages rose by 2.1% in these industries, and employment growth remains strong across all categories within the industry. Healthcare Workers: Physicians, Nurses, and Caregivers. Employment in this sector is growing at a rate of 2.1% annually, and Canada’s aging population will ensure above-average growth in the future.
Sectors such as retail, manufacturing, mining, oil, gas, and agriculture have recently declined in activity. Of these, only the mining and oil and gas industries are expected to increase employment over the next year on the back of modest stabilization in commodity prices and export activity. The same trend is seen among self-employed Canadians, with construction and industry-oriented occupations growing the most.
In 2007, the New Building Canada plan was implemented. This government-funded, $33 billion plan targets public, state, territorial and municipal infrastructure. Projects that support job growth, prosperity, and productivity, he is one of the top recipients of these coveted funds. The plan was created to reduce commuting time for working families, increase economic productivity and create jobs in Canada. Connecting Canada to the world is a priority for the government, so transport and connectivity projects are a priority.
These industries are hiring and will continue to do so for the foreseeable future. Meanwhile, the Canadian Economy is also heavily dependent on exports and international trade. The United States is Canada’s largest trading partner.
Canada earned $523.94 billion in exports in 2015. Major exports include automobiles and their parts, industrial machinery, plastics, aircraft, telecommunications equipment, chemicals, fertilizers, pulp, timber, crude oil, natural gas, and aluminum. The most important export partners include USA 75.2%, China 4.10%, Japan 1.93%, Mexico 1.51%, India 0.86% and South Korea 0.81%.
In 1988 Canada introduced free trade with the United States. Mexico became a partner of the North American Free Trade Agreement (NAFTA) in 1994, and in 2008 she traded more than 444 million people with her over $1 trillion in goods.
How NAFTA affects the Canadian Economy
The North American Free Trade Agreement (NAFTA) is an agreement between Canada, the United States, and Mexico that has removed most barriers to free trade between the three countries.
This deal means that buying certain goods from NAFTA countries is often cheaper than buying similar goods from non-NAFTA countries. Thanks to NAFTA, you can easily enjoy Mexican avocados all year round. Similarly, Canadians save significantly more on buying American-made cars than on European models. Goods from NAFTA member countries are imported duty-free according to the NAFTA rules of origin. These regulations specify the percentage of product content that must be produced in the Member States.
NAFTA was the result of 14 months of intense negotiations in 1991 and 1992. It was ratified by the Canadian, US, and Mexican Congresses in 1993 and entered into force in January 1994. Before NAFTA, Canada and the United States had a trade agreement called the Canada-US Free Trade Agreement.
Challenges to the Canadian Economy
Canada is overly dependent on unevenly distributed natural resources, resulting in uneven growth across regions. The exploitation of natural resources has negative environmental impacts, such as cod and salmon and loss of forest cover.
Three primary challenges to the Canadian Economy:
Oil exports account for more of Canada’s GDP than any other rich country, with the exception of Norway and the Gulf Arab Monarchies. In fact, with the exception of Canada, Norway, and Denmark, all the world’s significant developed countries are net importers of oil. By contrast, Canada is her 10th largest net oil exporter and her 5th largest net oil exporter outside the Middle East.
None of Canada’s major trading partners are likely to be the main beneficiaries of lower oil prices. Canada has one major trading partner, the United States, and three secondary trading partners: China, Mexico, and the United Kingdom. The United States accounts for more than half of Canada’s trade, and China, Mexico, and the United Kingdom together account for about 20% of Canada’s trade.
The price of oil is often correlated with the price of commodities in general. This is because producing a large number of goods usually requires a large amount of energy and a large amount of fuel for transportation. This poses additional risks to Canada as it is not only a large exporter of oil but also of many other commodities.
Non-oil commodities account for an estimated 20-30% of all Canadian exports. The prices of Canada’s major non-oil commodities
tend to correlate, at least to some extent, with oil prices. This includes not only natural gas and coal but also industrial metals such as nickel, copper, and iron ore, as well as industrial metals such as potash (used as fertilizer) and wood (which accounts for half of Europe’s “renewable energy”). Also includes non-metal products, of which Canada is the world’s largest exporter. Canada is also the world’s third-largest net exporter, behind France and Paraguay, the world’s largest uranium producer, and Kazakhstan.
Dependency on China
The relationship between Canada and China goes beyond exporting Canadian mineral resources to China and importing Chinese products to Canada. In particular, British Columbia has close economic ties with China due to its location on the Pacific coast of Vancouver (and Victoria) and its physical isolation from most other Canadian and North American markets. British Columbia sends about 35% of its foreign exports to China. That’s almost double the rest of Canada and 2.5 times her share in the United States.
As a result of these transpacific ties between British Columbia and Canada, Canadian exports to China account for about 2.5% of Canada’s GDP. In comparison, US exports to China account for only 1.3% of US GDP. %. Moreover, although economically significant social and financial ties exist between Canada and China, approximately 11% of the population of British Columbia and 5% of Canada’s total population are of Chinese descent. However, it isn’t easy to measure them accurately. 0.3% of the population of the United States, 0.3% of the population of the European Union, and 4% of the population of Australia.
All this means that Canada will feel the effects of China’s economic slowdown. This is not just because of the impact such a slowdown would have (and already has) on commodity prices. Canada’s Economy could be particularly hard hit in the event of a crisis in south-eastern China. This is because of the historical links between Canada and Britain; most Chinese immigrants to Canada come from Hong Kong and neighboring areas in south-eastern China (and speak South-eastern Chinese). Like Cantonese, Cantonese is only spoken by about 60 million people in China, while Mandarin has nearly 1 billion speakers.)
What is gross domestic product (GDP)?
Gross domestic product (GDP) is the monetary value of all finished goods and services produced within a country in a given period of time.
The North American Free Trade Agreement (NAFTA) was introduced in 1994 to facilitate trade between the United States, Mexico, and Canada.
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