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Quebec: Real GDP Rebounds in August
By Hélène Bégin, Senior Economist
HIGHLIGHTS
f Real GDP grew 0.9% in August, after falling 0.7% in July and rising 0.7% in June. August’s increase was due to advances in almost all the main sectors.
f Goods production rose 1.4% in August after dropping 1.0%
in July. All sectors saw strong growth except construction (-1.7%), which declined for the fourth month in a row.
f Services activity picked up (+0.7%) in August following a drop in July (-0.5%). Arts, entertainment and recreation (+4.0%) posted the highest increase, and accommodation and food services (+2.7%) saw a major gain as well.
f This rebound kept real GDP above its February 2020 level, just before the start of the pandemic.
f Compared with the same period in 2020, cumulative growth for the first eight months of the year stood at 8.4% in Quebec and 6.0% for Canada as a whole. Real GDP grew 0.4% in Canada in August.
COMMENTS
While a rebound in activity was forecast for August, it far
exceeded expectations. The ups and downs in Quebec’s economy are complicating the interpretation of results. Beyond the overall trend, a few industries stood out.
The construction industry has clearly started to slow down. As a result of August’s decline, in addition to the previous months’
drops, activity was down 8.1% compared with April, just before the lull set in. Residential construction alone fell 15.8%. After playing a major role in Quebec’s economic recovery, this industry is now curbing growth.
Fortunately, the summer period was favourable in the industries most affected since the outset of the pandemic. In July and August, the accommodation and food services, and arts, entertainment and recreation sectors continued the recovery
ECONOMIC STUDIES | NOVEMBER 29, 2021
begun in June. The additional loosening of measures in the fall, allowing entertainment venues and restaurants to resume full capacity, will help these industries continue to recover.
IMPLICATIONS
After the high volatility seen in real GDP over the last few months, the third quarter is looking better than anticipated.
Thanks to August’s rebound, growth should hover at around 1.5% in the third quarter. However, this is much lower than in previous quarters. Since Quebec’s economy completed its recovery phase in the spring, a slower pace of growth was to be expected.
GRAPH
Real GDP sees ups and downs
Sources: Institut de la statistique du Québec and Desjardins, Economic Studies Real GDP
In 2012 $B
+1.4% -0.3% -0.3% +0.7% -0.7% +0.9%
290 300 310 320 330 340 350 360 370 380 390
JAN. APR. JUL. OCT. JAN. APR. JUL.
2020 2021
