The Canadian Economy
The Canadian economy is made up of four main sectors: the Resources, the Service sector, the Oil sands industry, and the Electricity sector. However, while the oil sands industry contributes significantly to the economy, it’s not the only one. The government is focusing on inclusive and green recovery strategies, and making the economy more resilient and sustainable.
Statistics Canada has recently released the provincial and territorial Natural Resource Indicators (PTNRI), which measure the economic importance of the natural resources sector across Canada. These measures include output, nominal and real gross domestic product, imports and exports, and employment. They were developed as part of a cost recovery project funded by Natural Resources Canada.
The data show that natural resources are one of the largest contributors to the Canadian economy, and that investing in them will help the country recover post-COVID-19. In an Ipsos survey of 2,000 Canadians (18 years and older) conducted for Resource Works and the Task Force for Real Jobs, Real Recovery, 81% of respondents agreed that natural resource development is beneficial to Canada.
Canadians are heavily dependent on natural resources for their livelihoods. In 2005, 6.2% of the population was directly employed in jobs related to natural resources, and many more were employed indirectly by the sector. Moreover, natural resource employment in Canada also drives demand for other products, industrial inputs, and financial services. For example, a recent study estimates that 44% of the jobs generated in the Alberta oil sands are indirect employment outside of the industry.
The value of Canada’s natural resources is estimated to be around $550 billion in 2020, and $818 billion in 2019. These estimates take into account proven and probable reserves of selected minerals, established active reserves of energy, and timber stocks. Of these, natural gas and crude oil account for 50% of Canada’s resource wealth, while coal and timber provide 31% and 19%, respectively.
Canada’s service sector has played an important role in the global economy. It has grown from about 50% of GDP in 2004 to over 69% in 2013. In 2013, the gross domestic product of services was $714 billion. In contrast, the goods-producing sector produces tangible goods. In the Canadian economy, services include high-tech and knowledge-intensive jobs as well as low-skill, labour-intensive jobs.
The growth of the services sector in Canada has been driven by technological advancements. The global economy and the advancement of technology have resulted in an increase in demand for goods and services. The growth of the global economy has also increased the demand for accounting services, communication services, and other support activities. As these industries continue to expand, Canada has an increased opportunity to export goods and services to the rest of the world.
The Canadian service sector is a large and varied industry. Some services fall into the business sector while others fall into the non-business sector. Some of the industries that fall into this category include financial services, real estate, and communications. These industries have been growing rapidly in recent years and are concentrated in major urban areas. Other large sectors in Canada are health care and education. Both are under government influence and are increasingly a large part of the economy.
Canada’s service sector is an important part of the global economy. Although it is a smaller share of total trade than the goods sector, it is growing faster and more significantly than other sectors. It is also becoming an increasingly important contributor to productivity. The globalization of manufacturing has reshaped supply chains. As a result, the service sector is becoming a more critical component of the supply chain.
Oil sands industry
The oil sands industry in Canada is an important part of the economy. By 2025, it is expected to add $200 billion to the country’s gross domestic product (GDP). The industry directly employs 700,000 people and supports another 700,000 indirectly. It is also a source of revenue for governments, as it pays $17 billion in taxes, royalties, and fees each year. These funds go toward public services such as schools and roads.
The oil sands industry in Canada is also an important source of jobs for Indigenous people. There are more than 300 Indigenous-owned companies serving the oil sands industry in Alberta. In just 15 years, the industry has added more than $10 billion to the economy. In Fort McKay, for example, the industry has helped the First Nations build subsidized housing and provide funds for elder care. The oil industry has also allowed the community to pay dividends to its members.
Oil sands are considered one of Canada’s largest deposits of crude oil. The reserves are estimated to be 166.3 billion barrels. In 2014, the industry produced 2.2 million barrels per day. The sand contains bitumen, which is a hydrocarbon that is extracted by heating it in place. It’s produced by pipeline, rail, and marine transportation. It is a major part of the Canadian economy, and operators are subject to strict regulations.
According to the latest statistics from Statistics Canada, the oil and gas industry contributes significant amounts to the GDP of the country’s key industries. The sector generates approximately $490 million in GDP in the Manufacturing and Agriculture sector according to Statistics Canada’s (NAICS4) classification, and 16.9 percent of GDP in architectural engineering and related services.
The electricity sector is a significant part of the Canadian economy. The sector’s role in the economy and politics dates back to the late 19th century. In the 1890s, three competing firms attempted to develop a Canadian Niagara Falls. As the industry grew, the government formed provincial utilities that focused on hydroelectric development and rural electrification. Today, electricity companies operate under provincial, territorial, and federal jurisdictions. The provinces and territories regulate transmission and distribution rates and other policies that affect the industry.
The industrial sector accounts for the bulk of Canada’s electricity consumption. However, residential and commercial-institutional sectors also consume large quantities. Demand is expected to increase in the coming years due to population growth, though slower economic growth could limit growth. Meanwhile, Canadian consumers enjoy some of the lowest electricity prices in the developed world, especially in the provinces where hydroelectric dams provide electricity.
The structure of the electricity industry has changed significantly over the past decade. Most provinces have shifted away from vertically-integrated utilities toward separating generation, transmission, and distribution. In 2014, Canada’s electric utility sector generated 639 terawatt hours of electricity. This makes Canada the world’s second-largest hydroelectricity producer. Hydroelectricity accounts for about 59% of Canada’s electricity production, and most of it is exported to the United States.
The electricity industry in Canada is facing many challenges and opportunities. With climate change and the advent of new technologies, the electricity industry must adapt to these challenges. To create a more climate-secure grid, the country will need to invest in new sources of electricity, while also making changes to its existing infrastructure.
Exports in the Canadian economy are a key element of the country’s growth. In 2015, Canada’s total exports of goods and services were $503.8 billion, accounting for nearly one-third of the country’s overall GDP. These exports are largely focused on the United States, although the European Union, Australia, and New Zealand also played a role in Canada’s global trade.
Canada’s largest export categories are energy products, minerals, timber, and commercial services. In previous years, these were the largest export categories. The second largest category was commercial services, which includes financial and management services. Motor vehicles fell to fifth place. Although Canada exports many products, the bulk of its exports are still made of relatively unprocessed natural resources. Canada exports a large amount of raw metals and minerals. Other large categories of exports include information services and commercial services.
Exports are an important component of the Canadian economy, and Canada has a strong relationship with its top trading partners. These trading partners include the United States, the European Union, and China. Canada has free trade agreements with these countries, which helped to boost exports in recent years. Canada’s Comprehensive Economic and Trade Agreement with the European Union continues to support exports. However, the agreement hasn’t been fully utilized by Canadian exporters, and further promotion may be required to ensure full use of its benefits.
Canada and the United States enjoy one of the largest trading relationships in the world. Their two-way trade is valued at nearly US$1.7 trillion. Historically, Canada has been the largest export market for the United States. In 2021, Canada was the largest trading partner of the United States, accounting for 17.5% of all goods and services exported by the U.S.
Whether or not your income is taxable in Canada depends on your personal circumstances and your source of income. In Canada, the income you earn from employment or self-employment is taxed under Part I of the Income Tax Act and the relevant provincial or territorial tax statutes. In some circumstances, your income may be subject to a reduction under a tax treaty.
Canadians have an extensive social security system. This system provides benefits for old age, disability, and sickness. The government funds these programs with taxes paid by employees. Employees pay into the Canada Pension Plan or Employment Insurance (EI), or both, when they receive a salary. These contributions can reduce their federal income tax liability.
In addition to federal taxes, the federal government collects provincial taxes from individuals and corporations. Quebec has its own tax system. Depending on your source of income, the federal and provincial governments use different tax rates. The rates apply to individuals, corporations, and trusts. Partnership income is not taxed directly, but the partners share the partnership’s income. Moreover, Canadian residents are subject to income tax on worldwide income, and they can use foreign tax credits to reduce double taxation.
Capital gains and losses are taxable in Canada. If you sell or give away personal use property in Canada, you may have to report a capital gain or loss. However, capital losses do not usually apply to these types of assets.