The Canadian economy faces significant challenges, with the country experiencing the weakest growth among 50 developed economies since 2019. This downturn is largely attributed to a sharp decline in capital investment, a critical driver of economic growth, which has become increasingly unattractive under the current government. Economist Peter St. Onge from the Mises Institute reports that business investment has plummeted by one-third during Prime Minister Justin Trudeau’s tenure, while government spending has nearly doubled, now constituting almost half of Canada’s gross domestic product (GDP).

Concurrently, bankruptcy filings surged by 40% last year, and nearly half of Canadians have no emergency savings, according to the Canadian Imperial Bank of Commerce. The Canadian dollar has also weakened, depreciating by 13% against the U.S. dollar since its peak in May 2021, now sitting at 72 cents U.S. This depreciation has led to increased costs for imported goods, particularly from the U.S., from which Canada imported goods worth US$277 billion in 2023.

In response to economic challenges, the Trudeau government has expanded the public sector, adding approximately 180,000 workers over the past year, surpassing private sector growth. St. Onge highlights that one in three Canadians now works for the government, earning, on average, 30% more in salary and benefits than private-sector employees. Despite some moderation in inflation, Canadians continue to face significant financial pressures, with food inflation up 25% and energy costs rising by over 30% since the pandemic, exacerbated by the carbon tax.

Housing affordability remains a critical issue, with the average Canadian family paying more in taxes than on housing, food, and clothing combined. High personal tax rates and rising housing costs, fueled by a population increase far outpacing housing development, are creating a difficult environment for Canadian families.