Canada’s “ugly” development experience holds lessons for Australia.

June 10, 2026

According to the National Post, Canada’s newly announced recession has exposed how much the country’s headline GDP growth depends on record-high immigration, with Prime Minister Mark Carney admitting that declining immigration contributed to the downturn.

Analysts say it only shows what has been true for years: Canada’s economy is expanding only because its population is growing, not because productivity or living standards are improving.

Canada’s “ugly” development experience holds lessons for Australia.

Post-Covid GDP growth was largely driven by the addition of millions of new consumers (temporary workers, students, asylum seekers, permanent residents).

In both 2024 and 2025, GDP grew slower than population, meaning GDP per capita fell.

Economists describe this as a “per capita recession,” with Canadians effectively getting poorer.

The Fraser Institute found that from 2020 to 2024, Canada’s population will grow by 6.4% while GDP will grow by just 6%, marking the worst five-year decline in GDP per capita since the Great Depression. He called the trend Canada’s “ugly” growth experience.

The National Post article argues that Canada’s economic model is masking stagnation by relying on immigration-driven GDP growth. Once immigration slowed, the underlying weakness became apparent.

Lessons for Australia:

Canada’s experience echoes that of Australia, which experienced 10 quarters of negative GDP per capita growth over the past 15 quarters.

Australia’s real GDP per capita in the March quarter of 2026 was 0.5% below where it was in the June quarter of 2022 when the Albany Labor government took power.

As in Canada, record net overseas labor migration, averaging 1,162 per day in office (with the latest reading for Q3 2025), has masked a decline in Australia’s real GDP per capita.

Population growth has also masked Australia’s extraordinary slowdown in labor productivity growth, which has ranked among the poorest in the OECD in the post-pandemic period:

Taking a longer view, Australia’s productivity and per capita GDP growth has been in secular decline since the federal government doubled net overseas migration in the mid-2000s: