National Economy

[YOWetal]

Originally Posted by lio45

Yes, unless you want to argue that India, China, Indonesia, Pakistan, Nigeria, Bangladesh are among the most desirable places on the entire planet…? They’re all in the global top eight.

Again, per capita metrics actually matter here. We have a SMALLER economy per capita now with each passing year, because we’re diluting our economy with newcomers whose main quality is a pulse, i.e. boosting the total size of the economy (they still need to buy food, clothes, rent, etc.) yet dragging it down on a per capita basis.

Not rocket science. It’s again elementary school math (division.)

Yes this is especially true in Canada's case where we have huge GDP from resource extraction. Extra bodies do nothing to help this. That wealth just gets diluted down more especially when we have a government hostile to it's growth.

[Changing City]

Originally Posted by YOWetal

Yes this is especially true in Canada's case where we have huge GDP from resource extraction. Extra bodies do nothing to help this. That wealth just gets diluted down more especially when we have a government hostile to it's growth.

Do you have statistics? I may be misunderstanding the data, but it looks like Mining, quarrying, and oil and gas extraction only represented 5.1% of total GDP in 2023.

[acottawa]

Originally Posted by Changing City

Do you have statistics? I may be misunderstanding the data, but it looks like Mining, quarrying, and oil and gas extraction only represented 5.1% of total GDP in 2023.

NRCan says 19%

https://natural-resources.canada.ca/...sources/25653#

[YOWetal]

Originally Posted by Changing City

Do you have statistics? I may be misunderstanding the data, but it looks like Mining, quarrying, and oil and gas extraction only represented 5.1% of total GDP in 2023.

5.1% is low it was closer to 10% when Trudeau took over. Services are 70% of GDP as they are in most advanced economies. A lot of that is edcuation, healthcare, public administration. Naturally those things don't pay the bills. Even in Alberta it's less than 20% and it basically doesn't exist without the sector. It's not the case if we snapped our fingers and removed the sector we'd only be 5% poorer. O&G is about 25% of our exports alone.

[Changing City]

Originally Posted by acottawa

NRCan says 19%

https://natural-resources.canada.ca/...sources/25653#

That's counting energy as a natural resource, so that presumably includes electricity, rather than the narrower definition of mining, quarrying, oil and gas.

[lio45]

Originally Posted by Changing City

That's counting energy as a natural resource, so that presumably includes electricity, rather than the narrower definition of mining, quarrying, oil and gas.

Then the real number is >20% or even >30% since it doesn’t seem to include things like lumber, seafood, agriculture, etc.? (If you’ve paid attention, we’re discussing what’s 1) found in Canada, 2) has value, 3) is not unlimited i.e. can’t be willed into existence by the human mind, thus 4) is diluted per capita the more warm bodies there are.)

[Truenorth00]

Originally Posted by Loco101

Having a larger population should lead to a larger sized economy. Complaints in the past were that we didn't have a big enough population for many opportunities and economic diversity. We now have a larger population and somehow now it's a bad thing?

Quantity is half the solution. Quality matters too. There's a big difference in letting in a million strip mall scholars and a million PhDs.

[Truenorth00]

Originally Posted by YOWetal

5.1% is low it was closer to 10% when Trudeau took over.

Source?

And the fact that you want a higher percentage shows you don't understand how much the Canadian economy is devolving.

Canada has gone from 22nd in 1995 to 41st in 2021 in Harvard's Atlas of Economic Complexity. This is just one place above India in 2021. Our economy is becoming less complex and less value added as dependency on resources and real estate increases. Boomers inherited a complex, value added economy and turned it to shit so that their home values could pay for their otherwise unsustainable lifestyles.

https://atlas.cid.harvard.edu/rankings

[whatnext]

Originally Posted by Truenorth00

Source?

And the fact that you want a higher percentage shows you don't understand how much the Canadian economy is devolving.

Canada has gone from 22nd in 1995 to 41st in 2021 in Harvard's Atlas of Economic Complexity. This is just one place above India in 2021. Our economy is becoming less complex and less value added as dependency on resources and real estate increases. Boomers inherited a complex, value added economy and turned it to shit so that their home values could pay for their otherwise unsustainable lifestyles.

https://atlas.cid.harvard.edu/rankings

What resources are we becoming more dependent on? BC’s gov’t is handling forestry and mining disastrously, and we know the Feds are virtue-signalling us out of mining nationally.

[ericmacm]

Originally Posted by Truenorth00

Source?

And the fact that you want a higher percentage shows you don't understand how much the Canadian economy is devolving.

Canada has gone from 22nd in 1995 to 41st in 2021 in Harvard's Atlas of Economic Complexity. This is just one place above India in 2021. Our economy is becoming less complex and less value added as dependency on resources and real estate increases. Boomers inherited a complex, value added economy and turned it to shit so that their home values could pay for their otherwise unsustainable lifestyles.

https://atlas.cid.harvard.edu/rankings

The calculation on economic complexity does not seem to be as simple as how many different sectors an economy has - it seems to be a lot more dependent on the products themselves and to what degree they are value-added vs raw.

You can build a very complex economy off of resource extraction if you are adding value to those products domestically. Refined chemical products rank very high on that website’s complexity scale and appear to be up there with specialty equipment and machinery. I would suggest that our decline in complexity over the years has more likely been a result of manufacturing declining in the country, as well as other countries catching up and even surpassing us on the manufacturing front.

[Truenorth00]

Originally Posted by whatnext

What resources are we becoming more dependent on?

Exporting the unprocessed kind. As acottawa points out, it's nearly a fifth of our economy.

[Truenorth00]

Originally Posted by ericmacm

The calculation on economic complexity does not seem to be as simple as how many different sectors an economy has - it seems to be a lot more dependent on the products themselves and to what degree they are value-added vs raw.

You seem surprised that a calculation of economic complexity is **checks notes** complex.

Yes, it's a measure of the capacity of value added.

You know who is really great at exporting unprocessed resources with very little value added? Third world petrostates. That seems to be what we're working towards.

[ericmacm]

Originally Posted by Truenorth00

You seem surprised that a calculation of economic complexity is **checks notes** complex.

Yes, it's a measure of the capacity of value added.

You know who is really great at exporting unprocessed resources with very little value added? Third world petrostates. That seems to be what we're working towards.

There’s no need to be so snippy on a Sunday morning.

I was more or less saying that in reference to your original statement that more of an oil/gas/mineral extraction industry = less complex economy. That is not necessarily the case if you are actually using these materials domestically to add value (which we clearly aren’t doing so much of). We can make it work but choose not to.

[Truenorth00]

Originally Posted by ericmacm

We can make it work but choose not to.

That is indeed my complaint. But our culture, at its base, is broken. Anything that isn't about selling real estate or raw resources tends to be rejected outright. So the government tries to encourage battery manufacturing as a way to extract more value from the battery supply chain. And you get people YOWetal crying about it. All while arguing that we would keep immigration up to protect his primary asset. Perfect encapsulation of the disease that pervades Canada.

[MonctonRad]

Originally Posted by YOWetal

5.1% is low it was closer to 10% when Trudeau took over. Services are 70% of GDP as they are in most advanced economies. A lot of that is edcuation, healthcare, public administration. Naturally those things don't pay the bills. Even in Alberta it's less than 20% and it basically doesn't exist without the sector. It's not the case if we snapped our fingers and removed the sector we'd only be 5% poorer. O&G is about 25% of our exports alone.

Very true.

Services can create a lot of jobs, but, they do not actually create wealth. You only create wealth by building (or extracting) things and then exporting them. This brings external wealth into our national economy and boosts our GDP. The only thing services does is to recirculate pre-existing wealth within the economy. The effect of a service economy on national GDP is essentially zero.

To create wealth, Canada needs to selling goods internationally. You can do this purely extractively, but, if you want to boost the value of our exports, we should be selling manufactured goods created using the bounty of our natural resources.

Unfortunately, the only thing we have exported is our actual manufacturing capacity. It lives now in China.

Not a strategically wise choice, either militarily or economically. Canada gets poorer and weaker every year.

[Truenorth00]

Originally Posted by MonctonRad

Very true.

Services can create a lot of jobs, but, they do not actually create wealth.

Eh? You should tell that to Silicon Valley, New York, London, Singapore, etc.

Who gets 80% of the value of an iPhone being manufactured? The places where the materials were mined, the place where the phone is manufactured or the place where it's designed and marketed from?

Services can be highly lucrative. Providing your service sector isn't just low end tourism and retail.

[MonctonRad]

Originally Posted by Truenorth00

Eh? You should tell that to Silicon Valley, New York, London, Singapore, etc.

Who gets 80% of the value of an iPhone being manufactured? The places where the materials were mined, the place where the phone is manufactured or the place where it's designed and marketed from?

Services can be highly lucrative. Providing your service sector isn't just low end tourism and retail.

Well, banking services certainly can create national wealth because you can sell your services internationally. A service job at Burger King and A&W, not so much.

With an international corporation, company ownership and higher value added research jobs in the US certainly makes up for the loss of manufacturing jobs overseas, but, this scenario applies less to Canada, as we are not really even in the same ballpark as the US in terms of home grown multinational corporations.

In fact, Canada always loses out to the US in these matters. If a Canadian tech start-up comes up with a promising new piece of innovative tech, what usually happens is that they sell out to an American tech giant rather than going through the bother of trying to market and sell their products themselves. The eventual value of these new pieces of tech then ultimately contribute to the US GDP and not the Canadian GDP.

Canada remains left with a branch plant and extractive economy with comparatively reduced value and a decreased impact on our national GDP. We are poorer than we should be as a result.

[casper]

Originally Posted by Changing City

Do you have statistics? I may be misunderstanding the data, but it looks like Mining, quarrying, and oil and gas extraction only represented 5.1% of total GDP in 2023.

The stats to some extent also depend on how you categorise activities.

Take the oil sands as an example. Extracting heavy oil would be "oil extraction" while an upgrader facility that processed that prior to export would be "manufacturing". In the paper sector, cutting a tree is quite different from running a paper mill and spitting out rail cars full of paper stock.

It is a good things if the extraction category continues to go down as a percentage of GDP as long as the real value remains the same or grows. That just means other parts of the economy are growing.

We have significant natural resources. We just need to process more of it domestically and export less of it in a raw form out of the country.

[Truenorth00]

Originally Posted by MonctonRad

With an international corporation, company ownership and higher value added research jobs in the US certainly makes up for the loss of manufacturing jobs overseas, but, this scenario applies less to Canada, as we are not really even in the same ballpark as the US in terms of home grown multinational corporations.

In fact, Canada always loses out to the US in these matters. If a Canadian tech start-up comes up with a promising new piece of innovative tech, what usually happens is that they sell out to an American tech giant rather than going through the bother of trying to market and sell their products themselves. The eventual value of these new pieces of tech then ultimately contribute to the US GDP and not the Canadian GDP.

Canada remains left with a branch plant and extractive economy with comparatively reduced value and a decreased impact on our national GDP. We are poorer than we should be as a result.

It wasn't as bad as it is now. It's gotten worse because successive governments since the 80s/90s have decided to skew policy towards favouring the housing ponzi and resource exports and have decided that national champions are not worth defending. Something you would never see any other G7 country really do. It's the economic/trade equivalent of unilateral disarmament.

[YOWetal]

Originally Posted by MonctonRad

Very true.

Services can create a lot of jobs, but, they do not actually create wealth. You only create wealth by building (or extracting) things and then exporting them. This brings external wealth into our national economy and boosts our GDP. The only thing services does is to recirculate pre-existing wealth within the economy. The effect of a service economy on national GDP is essentially zero.

To create wealth, Canada needs to selling goods internationally. You can do this purely extractively, but, if you want to boost the value of our exports, we should be selling manufactured goods created using the bounty of our natural resources.

Unfortunately, the only thing we have exported is our actual manufacturing capacity. It lives now in China.

Not a strategically wise choice, either militarily or economically. Canada gets poorer and weaker every year.

A service economy is great my point is more the 5% measure is off in terms of measuring importance. I think the entire Canadian banking sector is also 5-6%. In terms of wealth generation both are important and 5% is misleadingly low. Granted without resource sector a lot of the banking industry isn't there. Same with manufacturing.

A value added service economy is ideal. But at the same time when you have a wealth generation engine by just digging stuff out of the ground only absolute idiots would try and actively stiffle it. That is my only point.