The NWT saw the largest decline in GDP in Canada in 2020, dropping by 10.4 per cent, according to the NWT Bureau of Statistics.
The other territories saw their economies grow, with Yukon’s growing by 1.1 per cent and Nunavut’s growing by 3.5 per cent. NWT’s decline was nearly twice as large as the national average, with the next highest percentage drop in GDP happening in Alberta at 8.2 per cent.
Most areas of the economy saw a decline, with mining declaring by more than 30 per cent. The biggest decline was in air transportation, which saw economic output decline by 61.3 per cent in 2020.
Construction was the sector that saw the highest growth overall, growing by more than 27 per cent overall. Engineering construction contributed to this growth, with the economic output for that sector growing by more than 60 per cent.
The areas that saw the largest declines were service industries, like air transportation, but also arts, recreation and tourism all suffered.
Finance Minister Caroline Wawzonek had previously predicted the gross domestic product would shrink by 6.6 per cent in 2020 as part of the unveiling of the 2021 budget.
The budget outlined a number of ways the GNWT are seeking to shake up the territory’s economy and boost growth in the future.
As well as government renewal — the process of refocusing government spending on the GNWT’s priorities — there was emphasis on economic diversification and the need for the NWT to improve the variety of businesses that operate in the territory
Wawzonek said investments in several areas, including education, childcare and the territory’s climate change plan, would help with this.
Wazonek said there had also been a position created focusing on the “knowledge economy” which will help with coming up with “regional economic development strategies.”
“While tourism and mining might cross all the Northwest Territories, if there is a region that has a particular interest in the fur trade, or in the fishing industry, or in film industry for example,” Wawzonek said. “There may only be a handful of jobs, and it may not necessarily reflect a huge change in the overall GDP picture. But for those particular communities, those could be tremendous impacts.”
Wawzonek said infrastructure spending would be key to kickstarting the territory’s economy as the NWT tries to recover from the pandemic.