StatsCan: Canada Risks 500,000 Jobs, $37B GDP As A Result Of Travel Restrictions

Anna Kroupina, Open Jaw

As Canada keeps its borders shut to tourism, Statistics Canada reports the travel restrictions will lead to an estimated loss of 400,000 to 500,000 jobs, and a reduction in GDP between $27.9 billion and $37.1 billion. 

The Economic Insights article presents five scenarios representing the impact on GDP and jobs based on when travel restrictions are lifted and the speed of recovery. The longer it takes for restrictions to be lifted and the slower the recovery, the larger the likely impact, concludes report author, Huju Liu. 

There is no comparative study on outbound travel at this time, however, the domestic travel impact on the GDP is significant and directly resultant from travel restrictions. The hope is that the projection of job losses will influence the government’s approach to overall travel limitations.

Under the five scenarios, the travel restrictions could lead to a reduction in GDP for the tourism industry of 50% to 70% in 2020 and, due to the interdependency between tourism and other industries, could lead to significant losses across multiple sectors.

"Under the scenarios considered in this article, the travel restrictions could cause a large blow to the tourism industry, reducing its GDP in 2020 by almost 50% to 70% from 2019," Liu notes. "The travel restrictions could also cause significant losses in other industries. The total impact for 2020 alone could result in a loss of real GDP of about 1.2% to 1.7%, which accounts for more than 10% of the projected overall decline in GDP growth. The pandemic will likely have a large impact on the Canadian economy."

In the current most optimistic scenario -- where domestic travel restrictions are lifted in JUL and international travel restrictions are lifted by DEC -- the travel restrictions could result in a national GDP loss of $17.6 billion to the tourism industry and $10.3 billion to other industries -- for a total of almost $28 billion, or 1.3% of total real GDP in 2019.

In the worst-case scenario – where both domestic and international restrictions are lifted in DEC -- the total impact could reach $37 billion, about 1.7% of total real GDP in 2019.

The impact on jobs is equally distressing, according to the report. The number of jobs directly impacted in the tourism industry ranges from 284,000 to 406,000, accounting for about 74% of total job loss. 

Anna Kroupina

Anna Kroupina Journalist

Anna is OJ's newest member and she joins the team as a writer/reporter. She co-writes the daily news and covers events. Although she's new to the industry, pursuing a career path in travel/tourism has been a goal since her first family road trip to the Florida Keys sparked a desire to discover the world and this exhilarating, fast-paced industry.

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