Tuesday, January 11, 2005

Economy at standstill

THE ECONOMY was flat for a second month in a row in October, largely because of labour problems, including the lockout by the National Hockey League, and lower foreign demand as a result of the soaring loonie.

The slump follows fairly strong growth in the summer months of June, July and August.

October’s weakness was widespread as only four of the 21 major manufacturing groups advanced. Manufacturing of non-durable goods dropped 0.6%, while output of durable products slipped 0.1%.

Two labour conflicts held back the service sector. Strike activities by federal public service employees reduced output of the federal public administration. The NHL lockout caused a 2.1% drop in output in the arts and entertainment industries.

Industrial production, the combined output of Canada's manufacturers, mines and utilities, fell 0.2%. The second consecutive monthly decline in output from factories offset marginal gains in the two other sectors.

In the United States, the index of industrial production rose 0.6% in October, with all three sectors showing strength.

Canadian dollar

Foreign demand for fabricated products fell in the wake of a 3.3% gain by the Canadian dollar during the month against the US greenback. The dollar hit its highest level in 12 years.

Construction activity declined 0.6% as residential construction retreated because of fewer housing starts, particularly in British Columbia, the Atlantic provinces and Ontario.

Non-residential construction was down for a seventh consecutive month. All types of construction declined, especially institutional and industrial.

Retailing activity increased as motor vehicle sales were bolstered by dealer incentives.

For more information, contact Bernard Lefrançois (613-951-3622), Industry Measures and Analysis Division.

  Print article

© 2004, 2005 Statistics Canada.