StatsCan revisions bump up Q2 GDP; finds economy fell faster during recession

OTTAWA – Statistics Canada says the economy expanded slightly more than previously reported in the second quarter, bumping up growth one-tenth of a point to 1.9 per cent.

The revision is contained in a massive re-calculation of the country’s national accounts dating back to 1981 intended to bring the way the Canadian agency measures the economy to international standards.

The review shows that Canada’s gross domestic product measure is ever-so-slightly bigger than previously thought — a difference of 0.14 percentage points.

But in the fine details, the agency did make some noticeable changes to the quarterly and annual data — including for the second quarter of this year.

Other findings were that the economy was slightly stronger last year, expanding by 2.6 per cent instead of the previously reported 2.4 per cent.

The economy was also stronger in 2008, particularly before the collapse that began in October.

Average growth for the year is now measured at 1.1 per cent, not 0.7 per cent.

But the agency says the economy fell as the world dropped into the worst slump since the Great Depression. Canada’s GDP in the fourth quarter of 2008 fell by 1.1 per cent, and by 2.2 per cent in the first three months of 2009 — both 0.2 percentage points more than previously recorded.

It all came out in the wash, however, as the 2.8 per cent contraction of 2009 was confirmed.

The revisions also found that Canada was doing better than thought prior to the recession, with the nominal GDP level in 2007 revised upwards by $36.4 billion or 2.4 per cent.

Scotiabank economist Derek Holt says the revisions will have no impact on policy makers and does not change materially the view of the Canadian economy’s performance.

Statistics Canada explained it was revising its reporting methods to comply with new international standards issued in 2008. Canada is one of the first nations to move to the new standards, with the U.S. expected to follow next year and Europe in 2014.