GDP by Industry, August 2026

Canada’s economy is still growing, but it is losing momentum

Canada’s economy was essentially unchanged in August, marking a second consecutive month without meaningful growth. Only 9 of 20 industrial sectors expanded. The preliminary estimate had pointed to growth returning in August. The official result shows that the economy stalled instead.  

By August, real GDP was 1.4% above its January level. This tells us that Canada did make economic progress during the first eight months of the year. But almost all of that progress occurred before July, with GDP essentially unchanged in both July and August.

The industries providing support are also changing from month to month. Retail rebounded in August, manufacturing advanced, and transportation grew. Wholesale trade fell sharply, public administration declined, and oil and gas extraction contracted for a third consecutive month. Some industries are still expanding, but not consistently enough to create broad economic momentum.

This is the forming trend: Canada is not in a broad contraction, but it is losing momentum at a time when tariffs, higher energy costs, elevated borrowing costs, and housing weakness are already putting pressure on households and businesses.

For our Vancity business members, a flat economy means less support from overall demand. Protecting margins, managing financing costs, and paying attention to what is happening in your own industry is more important than the national headline. For households, the experience will increasingly depend on job security, debt exposure, housing circumstances, and where they work.

The takeaway is this: Canada entered the second half of 2026 with more output, but less momentum. The economy is still ahead of where it started the year, but with growth now stalling, it has a smaller cushion against the next shock.

‍

‍