How Canada makes its money

Canada makes most of its money from services rather than from the oil, minerals and timber it is known for abroad. Industries such as real estate, finance, health care, retail, education and public administration produce the large majority of the country’s output, while natural resources and manufacturing earn much of the income Canada gets from selling to the rest of the world.

The economy grew 1.6 per cent in 2025, measured by real gross domestic product by industry, a slower pace than the year before, Statistics Canada reported on May 1, 2026. Ontario added the most to that growth, mainly through service industries, followed by Alberta and British Columbia. The three Prairie provinces, home to about 19 per cent of Canadians, produced roughly one-third of the national gain.

The biggest single industry group in Statistics Canada’s figures is real estate, rental and leasing, which includes the value of housing to the people who own and live in it. Finance and insurance, health care, construction, retail and wholesale trade, professional services and government round out the service side. Health care kept expanding in 2025, while federal public administration shrank in every province and Ontario’s community colleges contracted 10.6 per cent after the cap on international students, according to Statistics Canada.

Natural resources are a smaller share of total output than services, but they matter far more for trade and for some provincial budgets. Oil and gas come mainly from Alberta, with production also in Saskatchewan, British Columbia and offshore Newfoundland and Labrador. In 2025, oil and gas output rose 14.8 per cent in Newfoundland and Labrador, 7.3 per cent in British Columbia and 4.1 per cent in Alberta, Statistics Canada said. The expanded Trans Mountain pipeline, which opened in 2024, and the LNG Canada terminal at Kitimat, B.C., which shipped its first cargo in 2025, have given Canadian energy more routes to buyers outside the United States.

Mining, forestry, fishing and farming add more. Saskatchewan potash, Quebec aluminum, Ontario and Quebec gold, British Columbia lumber and Prairie canola and wheat are all major exports, and resource-producing provinces collect royalties that help pay for public services.

Manufacturing is concentrated in southern Ontario and Quebec, where factories build vehicles and parts, aircraft, machinery, chemicals and processed food. It had a difficult 2025. Manufacturing output fell in 10 provinces and territories, including drops of 4.0 per cent in Quebec and 1.6 per cent in Ontario, according to Statistics Canada, in a year when U.S. tariffs hit Canadian steel, aluminum and auto exports.

Trade ties these sectors together. Canada exported $779.0 billion worth of goods in 2025, down 0.2 per cent from 2024, according to Global Affairs Canada’s chief economist. Energy products were the largest category, and motor vehicles and parts brought in about $80.6 billion. The United States bought 72.5 per cent of those exports, down from 76.3 per cent in 2024 and the lowest share since the early 1980s, as more Canadian goods went to other markets.

Services are also sold abroad. Tourism, transportation, banking, insurance, engineering, software and film and television production all bring money into Canada from foreign customers, even though they do not show up in the merchandise trade figures.

Governments, in turn, make their money from this activity. Ottawa and the provinces collect personal and corporate income taxes, the GST and harmonized sales tax, payroll contributions and, in resource provinces, royalties on oil, gas, potash and other minerals. That is why a drop in oil prices can quickly open a hole in Alberta’s or Newfoundland and Labrador’s budget, while a slowdown in manufacturing hits Ontario and Quebec harder.

The spread of industries across regions gives the country some balance, but it also means Canadians feel economic shocks differently depending on where they live. The most recent monthly figures show the economy has stalled for a second month as payrolls shrink, a reminder of how closely household finances track these industries.

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File photo: shipping containers and cranes at the Centerm terminal in Vancouver’s harbour. Photo by Dietmar Rabich, Wikimedia Commons, CC BY-SA 4.0.