How well is Canada really doing? (Brighter Life)

Wednesday, November 21, 2012

By Kevin Press

CBC News reported yesterday on a confidential document that says the federal government has done too little to open up emerging economic markets for Canadian businesses. According to the CBC, the draft report reads: “The situation is stark: Canada’s trade and investment relations with new economies, leading with Asia, must deepen, and as a country we must become more relevant to our new partners.”

I expect we’ll see a good deal of political activity on the trade front in the new year. But there’s an assumption inherent in all of this that bears discussion: Does economic growth equate to an improved standard of living? Clearly the two can go hand in hand, but are policy-makers sometimes focused too heavily on gross domestic product (GDP) growth, at the expense of other measures of well-being?

That’s precisely the question raised by a study — released last month — out of the University of Waterloo’s Faculty of Applied Health Sciences. The Canadian Index of Wellbeing measures quality of life between 1994 and 2010. Eight separate categories were tracked, including education, leisure and culture and the environment. Progress (or a lack thereof) was measured over the study period, and an overall index score was calculated.

“Even in the years when we were really quite prosperous, the areas that contribute to Canadians’ well-being beyond the economy were not growing at the same rate as GDP,” said Bryan Smale, a professor at the University of Waterloo and director of the Canadian Index of Wellbeing. He and I spoke on Monday. “We’re not attending to the things that really matter to people to the same degree we are the economy.”

Four highlights:

  • While GDP rose 28.9% during the 17 years measured, the Canadian Index of Wellbeing rose 5.7%.
  • Well-being rose in all but two categories: leisure and culture (down 7.8% during the 17-year period) and the environment (down 10.8%).
  • Education was the category that performed best. It’s up 21.8%.
  • The numbers are less positive when you calculate the post-2008 recession results. Between that year and 2010, the environment, healthy populations, leisure and culture and living standards all dropped.

The study is robust. Pulled mainly from Statistics Canada data, the index is calculated with inputs from 64 indicators. While I’m not entirely satisfied that comparing the index to gross domestic product growth is a meaningful apples-to-apples comparison, that’s not really the point here.

Smale explained to me that what matters is how well-being has progressed in Canada during a volatile economic period that produced double-digit growth. “We’re certainly not suggesting that attending to the economy is the wrong thing to do,” he said. “What we’re suggesting is that if we only take a very narrow focus on it and nothing else, other areas of our lives suffer by comparison.”

The entire article is found at

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