Canada’s economy posted a 0.3% increase in real gross domestic product (GDP) in October 2024, reflecting a moderate recovery after a sluggish summer. The growth follows a 0.2% increase in September and marks a slight upward trend after four consecutive declines. October’s results indicate an evolving economic landscape driven by significant resource extraction and real estate improvements, though other sectors showed mixed results.
The standout contributor to the growth came from the goods-producing industries, which saw a 0.9% increase in October. Mining, quarrying, and oil and gas extraction led this surge with a robust 2.4% expansion, following three months of contraction. The oil and gas sector, in particular, played a pivotal role, with oil sand extraction rising 5.2% — its largest growth since December 2020. This surge came after maintenance shutdowns in August and September, with facilities returning to full production capacity, some even setting new records.
The broader oil and gas extraction sector saw an overall 3.1% increase in October, aided by higher natural gas extraction and a notable rise in exports. While oil sands extraction stood out, the natural gas subsector also saw notable gains, particularly in storage and export activities. The mining sector, excluding oil and gas, also gained momentum, with metal ore mining, particularly copper, nickel, and lead, rising by 1.4%.
Manufacturing, another key part of Canada’s economy, showed a modest 0.3% rise in October. This increase was primarily driven by non-durable goods manufacturing, which expanded 1.2% after four months of decline. The petroleum and coal product manufacturing subsector made the largest contribution, growing by 3.8%. The surge was propelled by the completion of maintenance activities at refineries, allowing for a ramp-up in production and higher exports of refined petroleum products.
However, the durable goods manufacturing sector saw a downturn, contracting 0.4% in October. Machinery manufacturing, in particular, struggled, posting a 2.9% decrease as most industries within this subsector faced challenges. This marks the 10th decline in 12 months for machinery manufacturing, with activity reaching its lowest level since 2021.
On the services side, the real estate and rental and leasing sector exhibited steady progress, marking its sixth consecutive month of growth with a 0.5% increase in October. This uptick was largely driven by a 6.3% rise in activities related to real estate agents and brokers, thanks to a surge in national home sales, particularly in major markets such as Greater Toronto and Greater Vancouver. This marked the sector’s highest activity levels since April 2022.
Meanwhile, construction activity also showed signs of recovery, rising 0.4% in October. The non-residential building subsector, especially investment in institutional buildings, saw notable gains, contributing the most to the overall increase. However, repair construction faced a downturn, partially offsetting gains from earlier months.
The transportation and warehousing sector continued to expand, increasing by 0.2% in October. Air transportation was a notable contributor, rising by 1.6% due to increased domestic and international flights. Pipeline transportation also surged by 1.9%, reflecting higher demand for natural gas and crude oil transportation.
However, the sector faced setbacks in other areas. Rail and water transportation, in particular, were impacted by strikes. Rail transportation declined 1.8%, while the water transportation subsector dropped 3.4%. Strikes at the Port of Montréal and several U.S. eastern ports disrupted both rail and maritime operations, affecting overall sector performance.
The outlook for November suggests a slight contraction in the economy. Early estimates indicate a 0.1% decrease in real GDP, attributed to declines in mining, transportation, and finance. However, these losses were offset by gains in the accommodation, food services, and real estate sectors. Given the preliminary nature of these figures, they will be refined in the official GDP release scheduled for January 31, 2025.
Despite mixed results across various sectors, the Canadian economy demonstrated resilience in October 2024, driven by strong performances in resource extraction and real estate. However, ongoing challenges in manufacturing and transportation, coupled with economic uncertainties ahead, highlight the complexities of the country’s economic recovery.