Based on estimates from the Conference Board of Canada,1 real gross domestic product (GDP)2 in the Québec City census metropolitan area (CMA) was $39.4B in 2021, a 4.3% increase compared to last year (2020). This economic rebound is the highest in over 20 years and is a result of catching up after the shock of the pandemic. Like in most Canadian regions, the economic impact of the COVID-19 pandemic is still visible in Québec City as the CMA is lagging behind compared to 2019.
In 2021, the Québec City region ranked last among the major Canadian CMAs in terms of standards of living and productivity, behind Montréal (second to last). The historic deficits in the Québec City CMA—and the province of Quebec in general—compared to the rest of Canada were caused in part by the industry structure. Nevertheless, the region is doing well compared to the pre-pandemic situation (2019), with the strongest growth in productivity for that period among major Canadian CMAs (+3.7%).
Although the pandemic has somewhat stabilized, uncertainty remains due to the inflation caused by supply challenges and the Russo-Ukrainian conflict. With that being said, economic forecasters remain optimistic and predict an economic recovery reaching a 4.0% growth rate in Canada in 2022. Based on outlooks from the Conference Board of Canada, real GDP in the Québec City CMA will return to its pre-pandemic levels with a 3.4% progression in 2022, higher than in the province of Quebec (+3.0%) and Montréal (+3.0%). This projected growth is relatively high, given that the average annual growth over the past ten years was 1.1% (2011–2021).
- Evolution by industry: The 2021 economic recovery (+4.3%) was supported by most industries in the region. Service-producing industries, which represented 82% of the CMA’s GDP in 2021, grew by 4.1%. In addition, goods-producing industries, which represented 18% of local GDP, grew by 5.1%.
- Standards of living: Real GDP per capita is commonly used to estimate the average standard of living or wealth of a given region. The region’s real GDP per capita ($46,888) was higher than that of the province as a whole ($43,879). However, among the major Canadian CMAs, it ranked last behind Montréal ($47,931). It should be noted that Montréal surpassed Québec City in 2021 in this indicator, a first since 2003 that can be explained by the city’s stronger economic recovery. In terms of relative growth, in 2021, the Québec City CMA, with a growth rate of 3.7%, lagged behind the increase recorded in the province of Quebec (+5.1%), Montréal (+6.5%) and Canada (+4.3%).
Labour productivity: Labour productivity is measured by wealth created per hour worked, but these hours worked are not available at the CMA level and will be replaced by the number of jobs in the context of this analysis (see Box 3). In 2021, real GDP per job reached $90,964 in the Québec City CMA thanks to an annual growth of 1.2%, the second highest among its Canadian counterparts.
In May 2021, the Conference Board of Canada was expecting a strong economic upswing, with a 5.6% increase in GDP for Québec City, 5.2% for the province of Quebec, and 5.9% for Canada. GDP growth was indeed strong, but not as strong as expected (4.3% for the Québec City CMA, 5.5% for the province of Quebec, and 4.9% for Canada). This is explained by the uncertain economic situation and the pandemic that continued to have a significant impact on the economy. Despite this, real GDP in the region had the highest growth in over 20 years and is getting closer to its pre-pandemic level, in 2019.
Standards of living and productivity are closely linked. Although the available indicators are not perfect, they remind us that the CMA and the province of Quebec are lagging behind the rest of Canada in both cases. The evolution of these two concepts is even more important considering that in the long run, the region’s growth will depend on productivity to face the aging of the population.
With increased automation and digitalization and by reorganizing work, businesses can be more efficient and, therefore, more competitive. With increased productivity, the region will be able to support its growth in the coming years while also mitigating the effects of labour shortages.