The Canadian economy is grappling with the big drop in oil prices, and the net impact will be a downshift in overall growth in 2015. Real GDP is likely to expand at a 1.8% clip, down from a 2.5% pace in 2014, as lower oil prices carve roughly half a percentage point from growth.
But the more dramatic impact will be how the regional landscape is shaken up this year, as previously high-flying oil-producing provinces plunge to the bottom of the growth leader-board, while some past persistent laggards move toward the top.
After booming at a 3%-plus pace during the 1970s and 1980s, real GDP growth slowed to just over 2% by the early 2000s, a period that captures the worst of the Great Recession. While growth in the 2010-15 period is currently enjoying a cyclical rebound from that deep downturn, the longer-term outlook points to continued deceleration toward roughly 1.8% through 2020 and beyond.
