The Saskatchewan GDP dropped by 5.2 percent in 2020 according to Stats Canada, which is the biggest drop since 2009.
University of Regina Associate Professor of Economics Jason Childs says while it is concerning, it’s not surprising.
“We knew the public health measures were going to take a toll on economic activity, and we’ve seen that,” Childs said. “It’s not as bad as it was mid-year when we’re looking at double-digit declines — so we did make back some of the activity that we lost in the first half of the year.”
Saskatchewan’s GDP dropped 5.2 percent, which is slightly better compared to Canada’s GDP which fell 5.3 percent. Alberta’s was the worst hit at 8.2 percent.
While oil, gas and mining industries were down roughly 33 percent, Childs says production will rebound as the U.S. economy begins to improve and open up.
“The Americans are going to be ready to go on driving holidays and travel around a lot more, they’re going to be going back into work and commuting,” Childs said. “All that kind of activity is going to put pressure on the supply, so I think we’re going to see oil and gas perk up a bit.”
Childs says this should be easier to make up than 2009’s economic depression.
“You had a financial crisis, which tends to lead to a slow recovery, this really is a supply-sucking, policy-driven crisis and we tend to come out of those fairly quickly.”
While service industries lost 4.1 percent, good producing sectors were down 6.7 percent during the year. Childs says while the economy is still reeling from the impact of COVID-19, it’s already showing signs of improvement this year.