 Monday, September 22, 2025 | | | Welcome to Mind Your Business ! Consider this your weekly guide to understanding what’s happening in the worlds of economics, business and finance. By Peter Armstrong
|  | GDP numbers this week will show just how hard the trade war is hitting the Canadian economy. (PX Media/Shutterstock) | | | We will have a much better sense by the end of this week if Canada is going to dodge a recession.
GDP numbers for July will come out on Friday. Statistics Canada will also release a preliminary look at the data for August.
We know the economy shrank 1.6 per cent in the second quarter of this year (April, May and June).
A technical recession is two back-to-back quarters of negative growth. On Friday, we will have data for two of the three months in the third quarter.
The initial report from Statistics Canada showed the economy likely expanded by 0.1 per cent in July.
If August stays on the positive side of the ledger, then Canada will almost assuredly have avoided a recession. (If July and August saw growth, it would take a sharp drop in September to make the quarter fall into negative territory.)
That would largely be thanks to the sweeping exemptions for the vast majority of Canadian exports.
As helpful and crucial as those exemptions have been, the trade war, the tariffs and the uncertainty have caused all kinds of damage to the Canadian economy.
That damage has been concentrated in areas that focus on the sectors that are hit hardest: steel, aluminum, autos and lumber.
Ontario has been particularly hard hit. In Windsor, the unemployment rate has climbed to 11 per cent.
The Financial Accountability Office of Ontario issued a report last week that showed precisely what that damage looks like. | | |  | | | | | The report found growth over the next two years will suffer the most.
"Based on trade policies as of August 5, 2025, Ontario real GDP growth, the broadest measure of economic activity, is projected to slow to 0.9 per cent in 2025 and 1.0 per cent in 2026 as U.S. tariffs reduce demand for Ontario’s exports, and businesses cut back on investment and hiring," wrote the report's authors.
As you can see in that chart, growth returns to its long-term average in the years between 2027 and 2029.
"However, this implies that the level of Ontario’s real GDP would be 1.7 per cent lower than in a no-tariff scenario in 2029," said the report.
That may not sound like a lot, but that sort of dip in economic activity means less investment, less government revenue and, of course, less hiring.
And that's just Ontario. Other jurisdictions will adjust in their own way.
Later this week, we will get the latest jobs numbers. The Survey of Employment, Payroll and Hours will provide a deep dive into the state of employment back in July.
We already know the Canadian economy shed 66,000 jobs in August. So watch for job and sector level breakdowns of where the weakness is concentrated.
This is the most recent breakdown from the Labour Force Survey, the main monthly jobs report: |  | | | So, by week's end we will have a much better picture of economic growth, the state of jobs and above all else, we should have a clear answer as to whether the Canadian economy is headed into a recession or not.
The fact that Canada may not have technically slipped into a recession won't mean much to most people.
There's not a huge difference between a 0.1 per cent gain and a 0.1 per cent decline in economic activity.
The fact is, the economy is struggling. Many Canadians are worried and can't find a job or keep up with debt payments.
Last week's rate cut won't make the trade war go away or provide tariff relief. At best, it will help some businesses and households weather the storm a bit longer.
What do you think? Email me at peterarmstrong@cbc.ca
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forwarded to you. | | | Three things to read, watch and listen to this week | | |  | Dragons' Den will launch its 20th season on Thursday (CBC) | | | 1. 20 years of Dragons | | | It's hard to believe Dragon's Den has been on the air for 20 years.
The statistics about the show are frankly kind of mind-boggling: - 1,780 businesses have been featured on the show.
- More than $238 million has been pledged to more than 900 deals struck on the show.
But more than anything, the show has put Canadian entrepreneurs in the spotlight.
In the United States, they celebrate entrepreneurs like pop stars. School kids can rhyme off the names of people who launched businesses. Zuckerberg, Jobs, Buffett are household names.
That's not been the case in Canada.
But Dragon's Den puts Canadian businesses and Canadian ideas at the forefront.
The show has served to launch products, ideas and careers.
Nicole Smith came up with a way to hire a local photographer to professionally capture vacation photo shoots as a side hustle in 2013. She eventually took it to the Dragons in Season 10.
“After our Dragons’ Den episode, our sales more than tripled. Fast forward to today, we have a team of 12 across Canada," said Smith, founder of Flytographer.
There are dozens of stories like this.
"By bringing entrepreneurial stories into the public eye, Dragons’ Den has helped shape a national mindset that celebrates creativity, problem-solving and business-building," said Grace Lee Reynolds, CEO of the MaRS Discovery District in Toronto.
Dragons' Den latest season premieres Thursday, Sept. 25 at 8pm / 8:30 NT on CBC TV and Gem.
Check out the latest on the 20th season of Dragons' Den here. | | | 2. The humble cardboard box | | | Every now and then I see or read or listen to something that stays with me in surprising ways.
If you had told me three people discussing cardboard boxes would fall into that category, I would have laughed you out of the room.
And yet here we are.
This episode of the Bloomberg podcast Odd Lots is wonderful.
In their inimitable way, hosts Joe Weisenthal and Tracy Alloway dig into the weird role boxes play in our economy and what they can tell us about the lay of the land.
"Boxes tend to contain products that people are buying, right? Yeah. So if no one's buying boxes, what does that say about retail spending? Right. The health of the consumer and the direction of the broader economy," said Alloway.
They interviewed Ryan Fox, a containers and packaging analyst for Bloomberg Intelligence.
He says the industry has seen a very challenging consumer environment over the last two years.
"My personal opinion: I would say we're in a consumer goods recession. Because of what we've seen, first half of 2025 box shipments were down 12 per cent from the height of the pandemic. That's a massive fall-off," he said.
The episode is great and full of wonderfully weird arcane facts about boxes: how they're made, why they matter and how to track what they're telling us about the economy.
Listen to this episode of the Odd Lots podcast. | | | 3. Canada-U.S. traffic by the numbers | | | One of the most common requests I've had from readers since the start of the year is that I provide some updates on how Canadians are responding to the U.S. trade war.
Are we actually travelling less? Are we buying fewer American products? Is any of this having an impact?
The American ambassador to Canada, Pete Hoekstra, has repeatedly complained about how Canadians are reacting.
"I'm disappointed ... it is very, very difficult to find Canadians who are passionate about the American-Canadian relationship," Hoekstra said at an event hosted by the Halifax Chamber of Commerce last week.
Surely Hoekstra has some sense of how Canadian boycotts are playing out.
My colleague J.P. Tasker has a great piece that endeavours to answer these questions.
In terms of travel — an area he says the rupture is most evident — the numbers suggest it's more than a slump.
"According to Statistics Canada data, the number of Canadian residents coming back from the U.S. by car in August dropped a stunning 34 per cent," writes Tasker.
Retail sales have been reshaped as well. Indigo says its sales of Canadian-authored books are up 25 per cent year over year.
Sales of U.S. booze have plummeted.
"Brown-Forman, the parent company of major U.S. alcohol brands like Jack Daniel's whisky and Woodford Reserve bourbon, reported in its recent quarterly earnings that sales to Canada have dropped by an eye-popping 62 per cent," he wrote.
Tasker also flags one thing I had not been paying attention to: culture.
"According to CBC/Radio-Canada, there has been a 34 per cent increase this year in time spent watching content on Gem, the public broadcaster's streaming platform," Tasker writes.
"Viewership for the Juno Awards, which celebrates Canadian music, surged 400 per cent on streaming platforms and drew strong conventional TV ratings with more than 2.8 million tuning in to some or all of the show, which leaned into the Canada-U.S. dispute."
Read J.P. Tasker's piece here. | | | How the economy looks beyond Bay Street | | | Retail sales declined in July | | | As we look ahead to this week's GDP numbers, one crucial batch of data came in last week.
Retail sales fell in July.
The decline was expected and pretty much in line with the preliminary estimate Statscan provided last month.
But there's a clear sign here that consumers are looking to scale back.
Declines were widespread. Sales were down in eight of nine sectors, led by clothing and accessories (down 2.9 per cent).
The only positive was autos. | | |  | It's not all bad news.
"While the July retail sales figures were soft, a decent August suggests Canadian consumers didn’t stay down for long. Despite ongoing trade uncertainty and further weakening in the labour market, the economy looks to be on track for a modest recovery to start the third quarter," wrote Shelly Kaushik, a senior economist with BMO Economics.
That should help us frame the GDP numbers on Friday. Pin your hopes on an August rebound.
What do you think?
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