15-001-XIE
Gross Domestic Product by Industry
October 2001 |
Gross domestic product (GDP) advanced 0.3% in October, after plunging 0.8% in September. The events of September 11 hit the transportation, accommodation and several other industries quite hard. Although economic activity recovered somewhat in October, remaining at mid 2000 levels, the underlying weakness in the economy persisted.
A strong recovery in retail sales provided the single largest push to the economy in October. A partial rebound in the travel-related industries also contributed. Lower interest rates provided the impetus for increased residential construction and housing re-sales which in turn boosted activity for real estate agents. Manufacturing output increased slightly as producers of paper products, motor vehicles and chemicals boosted production. In the mining industry there was lower oil and gas exploration activity. Declines were also reported for wholesaling activity, professional services and crop production.
Retail bounces back, wholesale falters
Retailing activity jumped 2.3% in October, erasing September's decline. This rebound paralleled the recovery in retail sales after the January 1998 ice storm. The biggest contributor in October was motor vehicle dealers whose activity increased 3.6%. Generous incentive programs spurred sales of new cars, which had been weak since April. Overall, there was widespread strength in almost all types of retailing; specifically, department stores and auto parts stores made significant gains.
Wholesaling activity fell 0.5% in October, after declining a significant 1.8% in September. Wholesaling of automotive products and computer equipment was responsible for a large part of October's decline. Wholesaling of grains also fell substantially reflecting lower crop yields. These declines were offset somewhat by increased wholesaling of food, beverages, lumber and machinery.
Travel-related industries continued to suffer
The aftershocks of the September 11th terrorist attacks in the US continued
to hamper travel-related industries (see graph
4). Air transportation, which was hit particularly hard in September,
falling 19.9%, increased output by just 2.0% in October. Flight reductions
initiated in September continued into October. Passenger rail transportation
and interurban bus transportation industries continued to benefit from
travellers averse to flying. The accommodation industry rebounded to
a degree in October, increasing 5.9%, after September's 10.7% decline.
The number of room cancellations in October was somewhat lower than
in September.
The travel and tour agency industry increased 3.8%, following a 12.5% drop in September. The gambling industry was flat as fewer US casino patrons crossed the border. The restaurant industry, which suffered a minor setback in September, edged up 0.1% in October. Partial rebounds were also reported for car rentals, taxi and limousine services and the scenic and sightseeing industries.
New-home building boosts construction
Residential construction activity advanced significantly in October, rising 2.3% as buyers took advantage of historically low interest rates. Significant increases were reported for both single-family homes and multiple residential units. Engineering projects and repair construction activity advanced for the second consecutive month after a string of declines. Non-residential construction activity declined for the second time in as many months.
A pause in the manufacturing slide
The manufacturing sector edged up 0.2% in October; production had plummeted 4.1% over the June to September period. Increased factory output of paper products, motor vehicles and chemicals was responsible for much of the increase. Ten of the 21 major groups increased, accounting for 62% of production. This growth was partly offset by lower production in telecommunications equipment, wood products, clothing and iron and steel products.
Paper products surged 4.2% in October, reaching levels not seen since the beginning of the year. Output of pulp mills rose 10.2% mirroring the increase in pulp exports. A number of pulp producers reported a return to normal output levels after several months of cutbacks and paper production increased 4.3%. Newsprint output also increased in October, however, their production levels are still 11.2% lower than year-ago levels.
Production of motor vehicles expanded 2.8% in October, partly recovering from the parts shortages caused by border delays in September. This was the first increase in motor vehicle assembly after four successive months of declines. Sales of new motor vehicles in the United States increased by more than 30% in October, setting a new sales record as North American automakers expanded financial incentive programs.
Chemical manufacturers rebounded 1.9%, after a 3.2% decline in September. The pharmaceutical industry continued on its upward trend with output now 30.6% higher than year-ago levels. Petrochemical producers surged 9.3%, after three months of drastic reductions in output, as major producers came back on line from their scheduled maintenance shutdowns.
Output in the computer and electronics industry fell 2.7%, the fourteenth consecutive monthly decline. Production declined 47% from its August 2000 peak. Makers of communications equipment continued to suffer - production dropped a further 9.3% in October. A prolonged worldwide slump in telecommunications investment continued to take its toll on this industry. Computers and peripheral equipment manufacturing managed a partial rebound, increasing 6.8% after a 14.8% drop in September.
The wood products industry lost ground in October after two consecutive monthly increases. Sawmill output declined 2.7%, the seventh decline in the last twelve months. Deteriorating conditions in the lumber market - falling prices, reduced demand and uncertainty over the United States' impending dumping charges - caused extensive layoffs in this industry.
Oil and gas exploration continue to pull down mining industry
Output in the mining industry declined for the second month, and now stands 8.7% off from its April peak. Lower prices for oil and gas continued to discourage demand for exploration. Drilling and rigging services output declined 11.6% in October, the fifth decline in six months. The increase in oil production reflected a resumption of activity by a major producer. The deteriorating steel market caused several iron mines to temporarily shut down operations resulting in a steep drop in this industry. Record low metal prices resulted in shutdowns in the metal mining industry and a corresponding drop in output. These declines were partially offset by increased output from gold and diamond mines.
Other industries
Electric utilities output increased 2.1% in October, recovering a portion of the 3.3% drop in September. A significant increase in existing home sales - the result of low mortgage rates - was mirrored in the output of the real estate agency industry. The public administration industry benefited from the resolution of labour disputes.
[Main menu |
Highlights |
Tables and charts |
Appendices |
User information |
Products and services |
Contact us |
Français]
All rights reserved Statistics Canada
