Seven of the top 15 Canadian industrial sectors saw declines in investment between 2015 and 2019, research from Canadian think tank the Fraser Institute shows. More industries saw declines in capital investment at one time than during any period since 1990.
“In a troubling trend, a wide range of industries in Canada have experienced a decline in investment, which is bad news for the economy,” said Steven Globerman, senior fellow at the Fraser Institute and co-author of Industry-Level Private Sector Capital Expenditures in Canada: 1990-2019.
Oil and gas led the way with a 48 per cent decline in investment. Utilities along with agriculture, forestry and fishing both saw a 19 per cent drop while retail trade saw theirs fall by 11 per cent. A majority of the 15 industries experienced decreases in investment in machinery, equipment, and intellectual property products like software, areas which significantly affect productivity and living standards.
“If policymakers in Ottawa and across Canada want to help improve private-sector investment performance, they should enact tax and regulatory reforms, particularly now as Canada emerges from the COVID recession,” Globerman said.