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News Analysis
Management professor Sylvain Charlebois says Canadian truckers are the proverbial canary in the coal mine for the state of the country’s economy.
Many of those working in the industry for decades say their trucking volume is getting lighter lately, the routes shorter, and their pay interval longer, according to the Dalhousie University professor. They are getting paid every 60 to 90 days, rather than every 30 days, which has occurred during previous economic downturns, Charlebois said.
“For many years, I’ve always believed that they’re able to foresee changes in economic cycles, and that they’re able to foresee exactly what’s going to happen with the economy,” Charlebois said in an interview with The Epoch Times.
“If you really want to know where the economy is headed, don’t ask an economist—ask a trucker,” Charlebois said on social media earlier this month. “I did, and they usually see the signs months before the data confirms it. What I heard isn’t good news for the Canadian economy.”
Ron Foxcroft, chairman and CEO of Hamilton-based trucking company Fluke Transportation Group, told The Epoch Times he agrees his industry is “the first barometer that sees the true economic future, whether it’s going up, or whether it’s going down.”
Foxcroft also confirmed that receivable payments have “slowed down” and trucking volume has declined by 10 percent in 2025. “We are in a very visible slowdown,” he said.
There are other signs pointing to worsening economic conditions in Canada, such as the country’s GDP falling by 0.4 percent in the second quarter of the year, or by 1.6 percent annualized, as well as unemployment rate reaching 7.1 percent in August. While the jump may not be too striking compared to the 6.6 percent seen in August 2024, recent job losses have been concentrated in full-time employment, while the offsetting gains have been in part-time positions.
Although these indicators paint a bleak picture of the economy, Canada is not technically in a recession.
A recession is generally defined by two consecutive quarters, or six months, of GDP shrinkage. Prior to the second-quarter contraction, Canada saw a GDP gain in the first quarter of 2025 preceded by five quarters of similar gains. That means Canadians will have to wait until Statistics Canada’s 2025 third-quarter GDP report, to be released in November, to find out whether the country is officially in a recession.
Economists say there are various ways to define a recession, and some say the typical one used in Canada has flaws.
According to Livio Di Matteo, an economics professor at Lakehead University in Thunder Bay, Ont., the traditional measure of a recession is a lagging indicator.
“By the time the recession is declared, it will have been underway for some time,” he said.
Eric Miller of the Rideau Potomac Strategy Group says Canada’s economy is currently in a tough position because it is attempting to reduce reliance on the United States and find new markets for its products, while simultaneously attempting to reach a trade deal with that country.
“Canada is in transition. It may need another quarter of recession, but any transition process is painful and time-consuming, and that’s where we are,” said Miller, who is president and founder of the Washington, D.C.-based organization.
Richard Dias, an economic analyst with Halifax-based investment firm IceCap Asset Management, says that any definition of a recession is going to be “arbitrary” and that the official definition used by Canada is “a useful way of thinking about it.” However, Dias said he believes Canada has been in a per capita recession for the last three years, with higher immigration rates boosting GDP but failing to make Canadians richer on an individual basis.
Dias notes, however, that he would be “surprised” if the third quarter of 2025 has negative GDP growth because companies will have adjusted to U.S. tariffs and found new markets to export products.
A Slowing Economy
Statistics Canada’s Aug. 29 quarterly GDP report found that Canada’s GDP shrank by 1.6 percent on an annualized basis in the second quarter of 2025, due mostly to a reduction in exports and business investment because of U.S. tariffs. The previous quarter saw Canada’s GDP rise by 0.5 percent because of higher exports and businesses accumulating inventory ahead of the tariffs.
The United States has imposed 35 percent tariffs on Canadian goods not covered under the United States-Mexico-Canada Agreement, as well as 50 percent tariffs on steel, aluminum, and copper; 25 percent tariffs on auto parts; and 10 percent tariffs on energy and potash.
Additionally, Canada has been facing a lack of long-term investment, including in the oil and gas sector, where investment fell from a high of over $80 billion in mid-2014 to just $24 billion in 2020. Premiers such as Alberta’s Danielle Smith cite federal policies as the culprit, calling them “hostile” to investment, while the Liberal government says it has introduced new legislation and policies to enable “nation-building” projects.
A Sept. 12 report by the National Bank of Canada said that inflation-adjusted investment in industrial machinery and equipment in Canada fell in the second quarter to its lowest level on record since 1981, while U.S. investment has surged in the opposite direction.
The Bank of Canada said in its latest monetary policy report, released in July, that the country’s economic growth was “stronger than expected” in the first quarter of 2025 due to a surge in exports in anticipation of U.S. tariffs. But the central bank said exports and business investment had fallen and also that growth in the second quarter had slowed but that domestic consumption was showing “resilience.”
The central bank said a great deal of “uncertainty” remains around U.S. trade policy, which has continued to weigh on household spending and business investment, as President Donald Trump has repeatedly imposed and then reversed tariffs on various countries.
Defining ‘Recession’
Canada did not officially enter a recession toward the end of 2023, but it came very close. The country’s GDP remained stagnant in the fourth quarter of 2023, and grew by just 0.4 percent in the first quarter of 2024.
However, a March 2024 report from the Royal Bank of Canada noted the country’s economic output was helped by “surging population growth,” which prevented it from entering a recession. Due to a loosening of immigration restrictions, Canada’s population increased from 38 million in July 2020 to an estimated 41.7 million as of this month, September 2025.
Former Bank of Canada governor Stephen Poloz said at a December 2024 webinar that he believed Canada’s economy was in a recession though not “a technical one” based on the definition of two consecutive quarters of GDP shrinkage. He said this was because of the large number of immigrants coming to Canada who boost consumption and thus drive up the GDP. Poloz said, however, that per capita GDP, which refers to a country’s GDP divided by its population, showed an economy in decline.
Statistics Canada noted in an April 2024 report that the country’s per capita GDP “has now declined in five of the past six quarters and is currently near levels observed in 2017.” The agency said Canada would need to see higher productivity and capital investment for its per capita GDP to return to an upward trend.
Di Matteo said there is an alternative measure of economic downturns known as the Sahm Indicator, which states that a recession begins in the United States when the three-month moving average of the national unemployment rate rises by half a percentage point or more compared to the minimum of the three-month averages from the previous 12 months.
According to Di Matteo, when using the indicator on Canada’s seasonally adjusted unemployment rate, the country “appears to have moved into recession territory in October of 2024.” He said this is because the indicator moved above 0.5 percentage points that month and has remained above ever since.
Miller said one definition of a recession, which was first used by former U.S. President Ronald Reagan, is “when your neighbour loses his job,” while a depression “is when you lose yours.”
While there needs to be a “yardstick” for measuring recessions, Miller said, there are various ways to measure economic downturns. “I don’t think we should change the yardstick, but we should be open to the fact that different recessions function differently,” he said.