This quarterly economic forecast for the province of Newfoundland and Labrador examines the economic outlook for the province, including gross domestic product (GDP), output by industry and labour market conditions.
Did COVID-19 Crack the Atlantic Bubble? Newfoundland and Labrador’s Two-Year Outlook—December 2020
Did COVID-19 Crack the Atlantic Bubble? Newfoundland and Labrador’s Two-Year Outlook—December 2020
Provincial Economic Analysis
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- Newfoundland and Labrador’s real GDP is forecast to contract by 5.1 per cent in 2020, held back by the combined impact of the COVID-19 pandemic and lower oil prices.
- Employment is expected to fall by 6.7 per cent this year, the fifth annual decline in the last seven years. In turn, the province’s unemployment rate will rise to an average of 14.3 per cent for 2020 after reaching a six-year low of 11.9 per cent last year.
- Even though low COVID case numbers and the Atlantic bubble allowed consumer spending to pick up in the second half of this year, total real consumption should still fall by 8.0 per cent in 2020.
- Increased economic activity will help to propel the Newfoundland and Labrador economy to 5.0 per cent growth in 2021 and an additional increase of 3.8 per cent in 2022.
- The completion of some major projects and the slowing oil production will then lead to a decline in real GDP as we head into the medium term.
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