TORONTO — A new report says manufacturing is leading the Canadian economy out of recession but warns that deepening trade tensions with the U.S. could stifle ongoing economic growth.
The RSM Canada report says Canada’s manufacturing sector is outperforming pre-pandemic levels, with manufacturing sales and railway car loadings — the amount of cargo transported by rail — surpassing pre-COVID-19 amounts.
It also says Ontario stands to gain exponentially from automaker commitments to electric vehicles.
Yet the research suggests Canadian manufactured products face market challenges amid increasing Buy American provisions in the United States.
Alex Kotsopoulos, RSM Canada projects and economics partner, says Canada’s overreliance on the U.S. leaves it vulnerable to trade frictions between the two nations.
Meanwhile, the report says Canada’s housing market accounted for two-thirds of economic growth in the first quarter as increasing demand for single-family homes and tight supply drove up prices.