Most developed economies continue to experience fall-out from the financial crisis of 2007-8. The Eurozone has been most ravaged, but the US and UK have not fared much better. After the initial rebound from the most severe crisis, growth in many economies has been decelerating to the point that some are once again contracting in real terms. At the same time, unemployment remains high – hitting record levels among youth in Europe for example – real incomes are flat for the vast majority, inequality is on the rise and austerity programs targeted at social services are eating further into living standards.
Canada has partly bucked these trends. While the overall growth rate has not returned to pre-crisis levels, it has not done nearly as poorly as that in Europe or even the US. Other measures of economic well-being do not suggest the level of alarm felt in harder-hit economies. To give two examples, the Canadian unemployment rate has grown relatively modestly and the distribution of gains since the crisis has not been skewed towards the very top to the extreme that it has been in the US and elsewhere. The financial press is increasingly optimistic – just this past week cheering newly-released above-forecast quarterly growth figures – and the Conservative government remains steadfast in touting our supposed economic prudence and resilience.
Finally, but not least, Canadian corporations also have had it relatively good since the crisis. Other than a sharp dip around 2008, profits have remained high and growing.
