Fraser Institute Report Says Canada’s Economy Has Fallen Behind U.S. Growth

A new analysis from the Fraser Institute is drawing attention to Canada’s economic performance over the past decade, arguing that the country has fallen behind key peers, particularly the United States.

The commentary, titled “Understanding the magnitude of Canada’s economic decline,” examines changes in inflation-adjusted gross domestic product per person, a common measure of living standards. According to the report, Canada’s real GDP per capita increased only modestly between 2014 and 2024, while growth in the United States was significantly stronger over the same period.

The authors state that by 2024, U.S. living standards, as measured by GDP per capita, were substantially higher than those in Canada, widening a gap that has grown over time.

The Fraser Institute attributes much of Canada’s weaker performance to domestic policy choices. The report points to higher levels of government spending, persistent deficits, rising public debt, and increased regulation as factors that may have discouraged business investment and slowed productivity growth.

The analysis also highlights concerns about Canada’s investment climate, particularly in sectors such as energy and natural resources, where regulatory and policy changes have been cited as barriers to expansion.

However, broader economic data shows the issue is more complex. Recent figures from Statistics Canada indicate that while Canada’s overall economy has continued to grow, real GDP per capita has declined in recent years. This reflects a combination of modest economic expansion and rapid population growth, which can reduce output on a per-person basis.

Economists have noted that Canada’s productivity challenges predate the current decade and have been a persistent concern across multiple governments. At the same time, global factors, including the economic impact of the COVID-19 pandemic, supply chain disruptions, and rising interest rates, have affected advanced economies worldwide.

The Fraser Institute’s analysis adds to an ongoing debate about the causes of Canada’s economic performance and the policy choices that may influence its future trajectory.

The full commentary is available on the Fraser Institute’s website.