Economic activity up in May 2016

Québec, August 26, 2016 – Québec’s real gross domestic product (GDP) at basic prices increased 0.4% in May 2016 following a period of stability in April and a 0.1% decrease in March. In Canada, the GDP dipped 0.6% in May, resulting primarily from a drop in oil extraction due to the forest fire and evacuation in Fort McMurray. Québec’s growth was attributed to the gains recorded in services-producing industries (+0.7%). Goods-producing industries decreased their activity level by 0.3%. For the first five months of 2016, Québec’s GDP was up 1.3% compared with the same months of 2015. In Canada, the corresponding rate was 1.3%.

In May, GDP growth was mainly on account of the gains observed in mining, quarrying, oil and gas extraction, public services, wholesale trade and retail trade. However, the manufacturing sector plummeted. In addition, thirteen of the twenty major economic activity sectors saw their output level rise in May.

Drop in goods output

In May 2016, goods-producing industries recorded a 0.3% drop following a 0.1% increase in April and 0.5% drop in March. Agriculture, forestry, fishing and hunting (–0.2%), construction (–0.8%) and manufacturing (–1.5%) saw a drop in their activity level. However, mining, quarrying and, oil and gas extraction (+3.8%) and public services (+3.6%) increased their output.

Rise in service output

Services-producing industry output was up 0.7% in May following a 0.1% drop in April and 0.1% increase in March. Several sectors experienced growth in May, including wholesale trade (+3.6%), retail trade (+1.2%), transportation and warehousing (+1.1%), the finance and insurance sector (+0.7%), educational services (+0.5%), the arts, entertainment and recreation sector (+5.0%) and public administration (+0.4%).

For the first five months of 2016, services-producing industries experienced 1.7% growth, while goods-producing industries posted 0.3% growth in comparison with the same period in 2015. In Canada, the rates were +2.3% and –0.9%, respectively, for the services-producing and goods-producing industries.

Manufacturing sector down

For the fourth consecutive month, manufacturing sector output dropped (–1.5% in May, –0.8% in April, –0.2% in March and –1.3% in February). The decline in May was mostly on account of the 2.7% loss observed in non-durable goods manufacturing. The durable goods manufacturing sector saw its output decrease 0.6%.

This drop in non-durable goods manufacturing was primary attributable to the food and beverage, chemical product and paper manufacturing industries. For its part, the drop in durable goods manufacturing was on account of the metallic product and transportation equipment manufacturing industries, as well as various manufacturing activities. In addition, fifteen of the nineteen manufacturing industries saw their output decline in May.

Downturn in the construction industry

Construction industry output was down 0.8% in May following a 0.5% drop in April and 2.5% upswing in March. The decrease in May was essentially attributable to the losses noted in engineering work. A 0.6% increase in residential construction activity was recorded in May, mainly on account of the gains observed in residential renovations. New housing construction (row houses and apartments) was also up.

Growth in wholesale and retail trade

Wholesale trade output rose 3.6% in May following a 0.9% drop in April and 1.1% increase in March. The May increase was mainly attributable to the gains recorded by food, beverage and tobacco wholesalers-distributors (+8.8%) and motor vehicle and parts wholesaler-distributors (+13.3%).

Retail trade output rose 1.2% in May following a 0.7% drop in April, mainly on account of the gains recorded by food and beverage stores (+7.2%).


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