A look at Canada’s economy and society three years after the start of the pandemic

March 11, 2023, marked three years since the start of the COVID-19 pandemic. COVID-19 is still around and continues to spread widely across Canada and in many other countries.

As in other countries, life in Canada has changed in many ways since the start of the pandemic. Some changes were direct impacts of the pandemic, while others were trends that were accelerated by it. In this article, we highlight some major economic and social trends that continue to impact the lives of Canadians.

Economic resilience 

Economy-wide output increased in 16 of the last 18 months and was 2.7% above pre-pandemic levels in December 2022. Growth in output slowed in late 2022, but employment strengthened in early 2023, as the unemployment rate remained near a record low. Employment rates for core-aged workers were well above their pre-pandemic baseline levels.

In late 2022, job vacancies eased, but they remained high. On a monthly basis, vacancies totalled about 850,000 in December, down from a peak of just over 1 million in May 2022.

Ongoing social repercussions

The pandemic impacted self-reported well-being and mental health, especially among young Canadians. From March 2020 to October 2022, there were 7.9% more deaths than would have been expected, had a pandemic not occurred. While, overall, COVID-19 was a main driver of excess deaths, other factors also contributed, in particular among younger Canadians.

In addition, the number of deaths attributable to alcohol and drug use reached new highs during the pandemic. At the national level, there were 4,605 such deaths in 2020 and 6,310 in 2021, and these numbers are expected to increase as data are revised in the future.

By comparison, at the height of the overdose crisis in 2017, 4,830 deaths were attributed to unintentional poisonings.

Younger age groups made up a disproportionate number of deaths from overdoses. Among people younger than 45, there were 2,640 unintentional poisoning deaths in 2020 and 3,600 in 2021.

Pressures on affordability

While headline inflation eased in the second half of 2022, there were few signs that key sources of upward pressure on prices—primarily food and shelter—were losing steam. While home prices have fallen considerably from peak levels, housing affordability has deteriorated as mortgage interest costs have increased.

Mortgage interest costs rose 18% in the 12-month period ending December 2022 and put strong pressure on the inflation rate in recent months.

In December 2022, food items that posted price increases of 10% or more accounted for two-thirds of food expenditures.

Newcomers boost population growth

In the third quarter of 2022, Canada posted the largest population growth rate (+0.9%) since the late 1950s. Population growth in recent quarters has reflected large increases in the number of non-permanent residents and high levels of immigration. Non-permanent residents have also contributed substantially to employment gains in recent months.

Since early 2020, over 1.2 million permanent and temporary immigrants have come to Canada, accounting for nearly 90% of total population growth.

For more information, see Update on the COVID-19 situation in Canada – January 27, 2023 - Canada.ca and COVID-19 epidemiology update: Key updates.